A lease agreement is a contract between a landlord and a tenant, giving the tenant the right to live in a property for a certain period. It’s not required to put a lease agreement in writing, but it’s highly advisable to do so.
What it should contain:
- Names and addresses of the landlord and the tenant and their contact details.
- Description of the property, including the physical address, and the type of property.
- Rental amount and payment terms, such as the due date for payment and the consequences for late payment.
- Duration of the lease: The start and end dates of the lease.
- The termination and renewal procedures should specify how to end the lease and the options for renewing the lease.
- Security deposit: The amount of the security deposit and the conditions for its refund. The security deposit should be held in an interest-bearing account for the benefit of the tenant.
- Maintenance and repair responsibilities. Clarify which party is responsible for maintenance and repairs, and the procedures for reporting and addressing issues.
- Restrictions and rules. Outline any restrictions on the use of the property and any rules or regulations the tenant must follow. For a sectional title property include the “house rules” of the complex.
- Utilities. This should clarify which party is responsible for paying the utilities such as electricity, water, and gas, and how consumption will be measured.
- Signatures of both parties. The lease agreement should be signed by both the landlord and the tenant to indicate their agreement and acceptance of the terms.
It’s important for the landlord and the tenant to carry out joint inspections and note the state of the property on the date of the handover – when moving in and when moving out. The Rental Housing Act considers these inspections mandatory.
These inspections help identify any damage or other issues and determine who is responsible for repairing or addressing them. The ingoing inspection gives both parties a baseline of the state of the property. Photographs are very helpful to capture the exact condition of the property.
Should there be any disputes between the landlord and the tenant at the end of the tenancy, the ingoing inspection report serves as evidence of the condition of the property at the start of the tenancy. It also helps to identify which issues are the tenant’s responsibility and will be taken from his security deposit.
It’s advisable for landlords to use a lease agreement drafted by a legal professional. Tenants should also seek legal advice before signing a lease agreement.