A Verbal Lease Agreement is Legal

Even without a formal lease agreement, you still have rights as a tenant! 

Imagine you rent a garden flat, pay a deposit and rent consistently, but there’s no signed lease. When you move out, the landlord refuses to return your deposit. What can you do? 

Key Points to Remember: 

• Verbal Agreements are Valid: A lease agreement doesn’t have to be written down to be enforceable. Even a verbal agreement between you and your landlord is considered a legal lease. 

• Importance of Inspections: Entry and exit inspections protect both you and your landlord. 

• • If there’s no record of an entry inspection, the assumption is that the property was in good condition when you moved in. 

• • If you miss the landlord’s exit inspection, they can still conduct one and claim deductions for any damages beyond normal wear and tear. 

• Deposit Deductions: Landlords can only deduct from your deposit for repairs due to damage beyond normal wear and tear. They must also provide receipts for these repairs. 

• Deposit Interest: Your deposit should be held in an interest-bearing account, and any interest earned belongs to you. 

• Taxes: Rental income needs to be declared to the South African Revenue Service (SARS), but your deposit does not. 

Getting Your Deposit Back: 

If the landlord refuses to give your deposit back, we recommend approaching the Rental Housing Tribunal to recover your deposit. This is often the most cost-effective option. The Small Claims Court is another possibility, but it may involve higher fees. 

Pro Tip: It’s always preferred to have a lease agreement in writing to protect the risks of both the landlord and tenant. Communication and documentation are key! Keep records of rent payments and any communication with your landlord. If you have concerns about your deposit or your rights as a tenant, don’t hesitate to contact us.