The Deposit may be any amount that the
parties agree to and need not only be the equivalent of 1 (One) month’s Rental.
If there is any doubt as to the integrity of the Tenant, a larger Deposit
should be taken. The Deposit must be held in an interest-bearing account and
may not be utilised during the subsistence of the Lease Agreement. Apart from
being a legal requirement, the reason for this is twofold: firstly because by
utilising the Deposit early, the amount of interest generated will be affected
and secondly, because if the Deposit is whittled down early, there is no
guarantee that there will be any funds left upon termination of the Lease
Agreement to cover damage to the Premises, arrear Rental, lost keys and the
like.
At the end of the Lease Agreement the
Deposit, less any deductions must be refunded to the Tenant within 14
(Fourteen) days. In terms of the Rental Housing Act 50 of 1999, a Deposit may,
in certain circumstances, need to be refunded within 7 (Seven) or 21 (Twenty-One)
days, but for the purposes of clarity, this clause stipulates 14 (Fourteen)
days.
Interest will accrue to the party
selected in clause 1.9. This is in terms of Regulation 9 of the Code of Conduct
for Estate Agents which stipulates that unless the parties agree in writing to
whom interest earned on such money must be paid, the interest will
automatically accrue to the Estate Agents Fidelity Fund. This would obviously
not be applicable to Landlords who are, in terms of the Rental Housing Act 55
of 1999 obliged to refund the interest to the Tenant.
Find out more here https://mrisoftware.tpn.co.za/blog/rental-deposits-demystified-what-when-how-and-why/