Tenants in a block of Bellville flats say they face an uncertain future after their new landlord threatened to double their rent.
The six-unit Basil’s Court in Voortrekker Road was managed by Diamond Properties until July, when all leases were ceded to Forchutec Properties (Pty) Ltd.
Tenants say that in August the new landlord, Bello Melo Forchu, who is listed as Forchutec’s director, told them the rent would go up from about R4 000 to about R7 500 — an increase of almost 100%.
The tenants say they cannot afford to pay the R7 500, let alone the two months’ deposit and rent they will have to pay if they move.
On Saturday September 2, one of the tenants received a hand-delivered eviction letter from the new property manager, telling him to be out within 30 days. The tenant has refused to budge, questioning the validity of the eviction order.
The tenants said they had had year-long leases in writing with the Transvaal Street Investment Trust under, the management of Diamond Properties, until 2013, when these were replaced by verbal month-to-month lease agreements.
“The reason for this,” said Barry Varkel, the property group’s attorney, “was in order to establish a position of equity between landlord and tenant, as, in terms of the Consumer Protection Act, a tenant is most unfairly entitled to give a single month’s notice on a lease that had a term of, for example, one, two or three years. This meant therefore that a tenant who may be in default of paying rent, could be given a month’s notice by the landlord,” he said.
Mr Varkel said his client, the Transvaal Street Investment Trust, made a deal with Forchutec allowing it to take over the leases for a monthly fee.
“During the time my client was still the landlord, my client was charging below market-related rentals… My client was very fair, reasonable, and one could even go so far as to say, a benevolent landlord, and always engaged with its tenants, and even permitted payment plans when the tenant was either late, or slow to pay, or was experiencing financial difficulties,” he said.
Mr Varkel said his client did not know what rentals Forchutec might charge nor did it know what terms and conditions of the lease agreement the property company had entered into with its individual tenants.
“In as much as the tenants might believe, their fight is with Forchutec, not with my client, as my client is no longer the landlord,” he said.
Michelle Dickens, managing director of the Tenant Profile Network (TPN) said there was no legal limit to a rent increase, whether the agreement was written or verbal. That was especially true in this instance, she said, where tenants were renting month-to-month, which meant the landlord could cancel by giving one calendar month’s notice.
“As rent control is no longer part of South African Law, increases are unrestricted. However, in terms of the Rental Housing Act, an increase must be reasonable. If approached, the Rental Housing Tribunal may see an increase of 100% as unreasonable depending on the specific factors at play in this case,” she said.
TPN is a credit bureau, which provides credit screening, reports and other services for the rental property market.
A tenant who has been living at Basil’s Court since 2004 said she did not know what would happen to her family, if they were evicted or made to pay the new rental.
She said she was used to living in the area and that it had been very convenient for her with the bus picking her up and dropping her in front of her home for work. She doesn’t have a car and relies on public transport.
The Rental Housing Planning Tribunal confirmed that one of the tenants had approached it about the rent hike, but it had not yet assigned someone to the case.
According to the tribunal, both written and verbal contracts are valid in law, but the tribunal recommends the lease should be in writing, as it can be used by both parties if a dispute arises.
The tenants say they were not given a formal lease when they met with Mr Forchu.
Ms Dickens said lease agreements regulate a tenant’s rights and responsibilities. Without a fixed-term contract, it becomes very difficult for a tenant to stay on if the landlord wants them out as they do not have permanent tenancy.
“Tenants have the right to approach the Rental Housing Tribunal for mediation. The landlord has the right of ownership and can thus choose whom he wants to occupy the premises and what that rental should be,” she said.
Ms Dickens said an owner had to give a minimum of a calender month’s notice to terminate a month-to-month lease.
“If this has been done, the tenant must vacate the premises or they will be an illegal occupant and may be evicted by a court.”
Ms Dickens said a tenant would be in breach of contract if they did not pay the rent. In terms of the Consumer Protection Act, the landlord must demand payment in writing and give the tenant 20 business days to settle. Should the tenant fail to settle after the demand, the landlord is entitled to cancel the lease and demand that the tenant vacates. Should the tenant fail to do so, the landlord will have to seek a court order eviction giving the sheriff of the court authority to forcibly remove the tenant.
When Northern News called Mr Forchu for comment, he asked if we wanted to make money off this story and said he had spoken to the tenants, and that they “knew” what was happening. He declined to comment further.