Sound advice for holiday letting landlords
Category Property Advice
Renting your property out to holiday tenants this festive season may bring you extra income, but what happens when their stay costs you more due to damages. Here's how you protect yourself and your property from bad holiday tenants.
It is vital to have a written rental agreement or contract signed by the tenant. The document needs to specify which property is being rented, the duration that the property will be rented for, as well as the cost of rent required - either per day, week, or month. It is also important that the document clearly states who will be liable to pay for costs such as water, electricity and any other services for the rental period.
According to FICA legislation, landlords are required to gather information about their holiday tenants. This information includes;
- tenants full name as per their identity documents
- phone numbers
- copies of their IDs or passports for foreign tenants
- the registration number of the car they are driving
- and their residential address
When booking a hotel or other registered holiday accommodation, the same process applies.
Ensure that your tenants pay a deposit. This deposit will cover any sort of breakage costs or repairs to the property, for instance, broken wine glasses. Conduct incoming and outgoing inspections of the property with the tenant, and do not forget to check the inventory. Often other than breakages, some guests may have sticky fingers.
Keeping with the topic of breakages, it would be wise to also advise your insurance company if the tenants will be staying in your property for more than 30 days. In some cases, they may increase your premium for that month. It is better to be safe than bear losses due to damages or theft. Make sure that you will be covered for any theft or damages done by your tenants as well as theft of the tenants' belongings. Also, liability cover will come in handy in the event that your tenant gets injured on your property.
Bear in mind, if your property is in a sectional title complex then your guests are also required to follow the building rules. It would be a great idea to send your guests an electronic copy when they make a booking as well as have a printed copy easily available at the property. To safeguard yourself it would be wise to include a provision in the rental agreement which states that if the tenant breaks the rules and the body corporate imposes fines on you then they will be liable to pay the fines.
As a landlord, you also need to protect your own belongings. Generally, if you let out your property to holidaymakers all the time you do not keep any valuables in that home. However, if you do live on the property often you would want to take the necessary precautions to protect your belongings. Lock away items such as jewellery, keys and small electronics, as well as park your car at a friend's home during this time.
As per South African law, citizens are required to declare all income they have received in the tax year. So while cashing in on your tenants stay during the holiday season remember to cater for your declarations in a few months.
If you are looking for the perfect holiday home contact Knight Frank today. Our team of area specialists will help you navigate all avenues of the buying process and find you the ideal home.
Author: Knight Frank
