What happens at the end of your tenancy?

Most landlords require a deposit before a tenant occupies a rental property. This is often the equivalent of one month’s rent but may be one and a half or two months’ rent in areas of high demand, like Cape Town. The deposit is a form of security against any damage the tenant may inflict on the property. The definition of “damage” can be subjective and some property owners will try to claim fair wear and tear as damage. For this reason a well-structured lease that clearly sets out the expectations of both parties and an initial inspection conducted jointly by landlord and tenant are useful tools in preventing disputes down the line. The rental deposit return should be repaid at the end of the tenancy, less any deductions for damage. What are the legal rights and responsibilities of both parties concerning the deposit?

Timeframes for rental deposit return

The Rental Housing Act 1999 is very clear on the terms for the repayment of a deposit. The landlord must return the deposit within a set timeframe, which is determined by whether or not there is any damage to the property and if the tenant attended the final inspection before vacating the premises. There are three main periods that apply:

  1. If no amounts are owing by the tenant to the rental agent or landlord in terms of the lease agreement, for example for unpaid rent or utilities, the landlord must pay the full amount of the deposit plus any interest to the tenant no later than seven days after the termination date (excluding weekends or public holidays).
  2. If there are any monies owing or any damage that needs to be repaired, the agent or landlord can deduct the cost of from the deposit in terms of any provisions of the lease agreement. The landlord must then pay the balance of the deposit plus interest to the tenant no later than 14 days after the termination date. 
  3. If the tenant fails to attend the final inspection, the agent or landlord must, on termination of the lease agreement, inspect the property within seven working days from the termination date to assess any damages or loss. The agent or landlord may then deduct the reasonable cost of repairing any damage or any monies owing by the tenant in terms of any provisions of the lease agreement from the deposit. The balance of the deposit plus interest must be refunded to the tenant no later than 21 days after the termination date.