Tenants battle with rent in hard times

24 October 2017 - 05:47 By Nico Gous
Image: 123RF/Michael Thompson

When Simone Beckerling rented out her Greyton, Western Cape, home she never suspected she would end up R64,000 out of pocket, struggling to evict her tenants who have not paid rent in three months.

Beckerling is one of a growing group of property owners struggling to collect rent on time as an increasing number of tenants pay late or request a grace period due to financial pressure.

The latest Rental Monitor report from the credit bureau TPN, which specialises in property rental, has shown a fall in the number of tenants who pay rent on time.

While late payment is less prevalent than in 2008, at the height of the global economic crisis, it paints a picture of the effect of economic conditions on tenants and landlords.

The quarterly report says the number of tenants who did not pay their rent increased from just over one in 10 (11%) in 2014 to 17% in the second quarter of this year.

Only 65% of tenants paid rent on time in the first two quarters of 2017, compared to the high of 72.5% in 2014 and 71% in 2013.

Meanwhile the number of tenants making partial payments, paying late or requiring grace periods fell from 85.9% in 2014 to 82.8% in 2017.

FNB property strategist John Loos writes in the report that tenants whose monthly rent was less than R3000 a month struggle most.

"Being the group that, on average, is less skilled than the higher income groups, we believe that it suffers worse in terms of job and income loss in weak economic times."

Just more than half of the people (53.8%) in this group did not pay rent on time.

Tenants paying over R25000 in rent also frequently pay late, with only 59.26% paying on time.

Beckerling has spent almost R30000 on legal fees to try to recover R33500 in outstanding rent and other fees. The rent is R9680 a month. She served the tenants with an eviction notice on October 12 after they had not paid rent for three months.

On Wednesday she cut off the electricity to the house before the Caledon Magistrate's Court ordered her on Friday to reconnect the power. She did so on Saturday.

The tenants have two weeks to dispute the eviction notice before the magistrate's court issues a court order.

Beckerling believes landlords are "absolutely trapped" and a one-month deposit "which is long gone" is insufficient to recover legal costs.

On October 13 the Sheriff of the Court went with a trailer to her house to collect furniture to recover some of the money the tenants owe Beckerling. The tenants had, however, moved their furniture out of the house.

"I was joyous. I thought they were going," Beckerling said. The tenants are living in the house with a mattress, fridge and a stove.

They started leasing her house in April 2015 and the lease states the tenants will be given two months' notice should problems arise.

Trouble started in the second month when the tenants started delaying payments and paid in instalments.

Michelle Dickens, managing director of TPN, advised landlords to do proper assessments on potential tenants. This entails getting their consent to pull the credit records of everyone who will live on the property and checking their criminal records.

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