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How to protect your property in Israel from undesirable tenants
Property owners throughout Israel who are interested in protecting their expensive property and enjoying a fixed monthly income from the rent are sometimes forced to contend with undesirable tenants. These tenants can cause great damage to the apartment owners if they don't pay rent, refuse to vacate the apartment at the end of the tenancy period and in some cases even vandalize the property.
A comprehensive tenancy agreement which is balanced between the interests of the owner and the tenant and encompasses their unique circumstances is aimed at minimizing these occurrences.
A legal agreement of this type is aimed at regulating the contractual relationship between the parties and serves as a kind of deterrent through which disagreements which are likely to bring about a legal dispute are reduced. The contract focuses the behavior of the parties and makes each party understand the obligations of the other party in advance.
Likewise, a tenancy agreement which is worded correctly and properly will protect the property owner and provide him with legal support if the tenant breaches his obligations and the dispute reaches the stage of litigation.
The wording of the tenancy agreement is a complex and important undertaking and property owners who make use of a tenancy agreement which does not provide the appropriate protection are exposing themselves to many dangers.
Many apartment owners use a lawyer to formulate the tenancy agreement and others prefer to transfer all the handling of the property to a property management company which deals with all aspects of the property including renting the property, representation by a lawyer, maintenance of the property and repairing defects. These property owners enjoy monthly rent payments and save themselves trouble, time and having to cope with Israeli bureaucracy and the Israeli mentality.
Below you will find a number of recommendations and essential points on renting your property and the tenancy agreement:
- Before signing the tenancy agreement, it is important to carry out a preliminary selection of tenants. Ask the tenant for a copy of his identity card and make sure that he is the person who will sign the tenancy agreement. Find out the occupation of the tenant and about his way of life.. Ask the tenant to show you proof of his ability to make the rental payments. It is preferable to ask for copies of his latest salary slips or confirmation from an accountant if the owner has his own business.
- Document the state of the property and its contents with photos before the start of the rental period. Make a comprehensive and detailed inventory of the existing state of the apartment and the equipment left in the property for the tenant's use and add this list as an appendix to the contract.
- It is important in the tenancy agreement to note some essential details: that the laws which protect the tenant do not apply to the rent and will not apply in the future: the purpose of the rent, the monthly amount of rent, the payment method and the dates of the payment. It is customary to ask the tenant to pay rent with post-dated checks for a whole year and therefore you should beware of tenants who try to avoid doing this.
- The tenancy agreement obligates only the signatories and so it is important to emphasize in the contract that the tenant is not allowed to let the property or any part of it to someone else and likewise not to allow another person to use the property or part of it, whether in exchange or in his absence.
- You should determine payments for utility bills (municipal tax, water, electricity, gas, house committee etc.) in the agreement and make sure that these bills are transferred into the name of the tenants, so that the authorities or relevant bodies will refer their demands for payments to the tenants in case of debt.
- You should determine who will repair defects and damage caused to the property. It is customary for the owner to be responsible to carry out repairs only if the defects were caused through reasonable wear and tear.
- Define the rental period and make sure that you are allowed to sell the property without harming the rights of the tenant. Likewise, you should include a clause by which the owner has the right to shorten the rental period and bring the rental period to an end with advance notice.
- It is desirable to lay down in the agreement that changes, improvements and additions to the property will be carried out by the tenant with the prior written agreement of the owner. Likewise, it should be established that at the end of the tenancy agreement, the tenant will remove his belongings from the property and return it to the owner just as it was on the day the tenancy agreement began and that any changes or additions carried out by the tenant will remain in the possession of the owner. Set down fixed high compensation, agreed in advance for every day the tenant does not vacate the property.
- In order to ensure the implementation of all the tenant's obligations, it is important to demand that the tenant transfers significant collateral in order not to leave the property to the tenant without suitable and proper protection. Collateral can include a bank guarantee, a third party guarantee, a promissory note signed by two guarantors, checks (for security only), and in certain cases a cash deposit. Remember that the level of effectiveness of each of these types of collaterals is different and therefore, it is advisable to combine a number of these collaterals together.
- Note in the contract that the owner has the right to visit the flat with prior notice in order to make sure that the owner is fulfilling his obligations. Likewise, make sure that in the last months of the tenancy the owner will be able to show the property to potential tenants at least twice a week.
- Many apartment owners recognize the importance of a rental contract and understand that the clearer and more comprehensive the provisions, and the more appropriate they are to the type of property, the less chance there is for misunderstandings and future disagreements.
Written by property manager and advocate Neta Bachrach http://www.homeandaway.co.il/en/
Note that the information here is preliminary and general only and cannot be considered to be or replace legal advice.
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