Managing water restrictions in tenanted properties
Category Blog
The Western Cape is facing the biggest drought in 100 years and there have been severe water shortages in other parts of the country over the summer as well. The Cape Town municipality is now installing water-management devices at properties that have been non-compliant with the new level 5 water restrictions and there are talks of fines between R5,000 and R10,000 for households that use too much water. While matters are currently wetter in the rest of the country, Gauteng and the Free State also recently had severe droughts.
With many experts predicting that these shortages are the new normal many landlords and body corporates are now faced with controlling water usage at their rental properties and in sectional title schemes (which often don’t have separate water meters for each unit). “While there is no question that we should all be doing our best to save water, it is also true that not every tenant is equally responsible. This places a burden on the landlord who may need to pay more for water, and even face fines if their tenant wastes water,” explains Bruce Swain, CEO of Leapfrog Property Group. Landlords are historically liable for these costs as it’s included in the levy, which is paid by the owner, not the tenant of the property.
Installing a water meter per sectional title / or rental unit may seem like the answer, but there is a complication – the lease agreement. “If the rental agreement states that the owner of the property will pay the levy (which normally includes water, sewerage and refuse), then the higher water costs (or fines) will need to be paid for by the owner – who may not have bargained on these additional costs,” explains Swain.
In some cases, the rental agreement could have a clause stipulating that the tenant would be responsible for unforeseen cost increases, in which case the tenant will have to pay in the difference. “Ultimately who pays for additional water costs will be determined by the lease agreement. I would advise landlords to be very careful in terms of respecting their lease agreements,” says Swain, “The only option for landlords would be to try and negotiate an addendum to the lease – making the tenant responsible for future water costs, over and above those listed in the levy.”
Water wasting tenants
“If the tenant continues to overuse water then it may be time to consider eviction processes,” says Swain, “I would also recommend that any new leases stipulate that additional costs will be the responsibility of the tenant.”
Author: Leapfrog Property Group
