Louis Kruger Property Management

Your building, our priority.
6 Chas Booth, Camps Bay proudly managed by LKPM
Experience personalized property management with a focus on attention to detail. Discover the difference we can make for your community.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Tel: 021 903 3101

Louis Kruger Property Management (LKPM) was founded by Louis Kruger (snr) in 1975 and has been been attending to the administration, management and letting functions of several community schemes, office blocks, shopping centres, apartment buildings and houses since.

1) Sectional Title and Home Owners’ Association Management:
We have been managing sectional title schemes since 1999 and still manage the scheme we started managing in 1999. Although this was never our core business, we noted that many community schemes suffer financially as a result of ineffective management and decided to make use of our extensive knowledge of property management to offer a superior administrative and management service to community schemes. By doing this and offering our clients a tailor-made service, we have grown our portfolio from around 200 units to more than 2000 units over the last 3 years. We also pride ourselves in successfully helping distressed schemes to implement new measures to ensure financial success.

2) Residential:
Our expertise in the management of residential properties is second to none. We have clients using our services in excess of 40 years. Actively managing over 300 residential units and several mixed-use buildings, we continuously reflect a 100% letting ratio. Our proven collections systems maximize the speed of payment to our customers and minimize costs.

3) Commercial:
The past 20 years saw LKPM adding considerable value to our client’s shopping Centre, office and industrial investments. With successful leasing we have significantly increased occupancy levels to nearly 100% at all the buildings in our portfolio. Some of which had 100% vacancy levels! We are well aware of property market conditions in the Western Cape and concluded new leases with major national and international companies in all areas.

4) Asset Management:
Our extensive experience in neighbourhood and convenience shopping centre management gives us the ability to effectively analyse and interpret trading conditions to advise property owners on marketing and leasing strategies, tenant mix and lease agreement structure. By redeveloping and effectively using existing voids we have also succeeded to convert several “dead” spaces in commercial buildings into income yielding areas.

5)Leasing:
At times we concluded more than 50 new commercial leases over a 12 month period, totaling in excess of 10,000 square metres in one year as well as the more or less the same number ofrenewals. In our dealings we have built up relationships with a large section of the major retailers and all banks in South Africa. Leases concluded over the years include numerous major national and international companies including Nedbank, Absa, HERE Europe, Old Mutual, MTN, Vodacom, Post Office, Famous Brands (Wimpy, Steers, Debonairs), Pick ‘n Pay (Grocer, Clothing, Liquor), Shoprite Checkers, Baby City, Planet Fitness, Spar (Super Spar, Pharmacy and Built It) and many more.

6) Project Management and upgrade of buildings:
We have actively managed the improvement of buildings in projects from R10 000 to over R5m, as well as a number of tenant installations in excess of R1m. This included negotiations with local authorities to ensure compliance, asbestos certification, fire compliance and painting.

7) Maintenance:
We controlled a budget of over R3m per annum for repair and maintenance and completed more than 3,000 jobs in a 12-month period. We have developed streamlined systems to ensure quick cost-effective solutions and built up relationships with a pool of contractors for different maintenance challenges and we are able to assess and solve problems effectively and quickly if necessary.

Credit Control:
With more than 30 years’ experience in rental collections we have effective processes in place to minimize arrears while at the same time maximising occupation. Dedicated staff manages and assesses, with senior staff where necessary, each individual case and implement the most effective solution.

We are the property management service provider of choice for serious property investors, we also guide and advise so that you have confidence and peace of mind that your property investments are on track.

Louis Kruger Property Management is registered at the PPRA and Council for Debt Collectors. We are members of the Institute of Estate Agents and South African Council of Shopping Centres.

For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

Your building, our priority.
6 Chas Booth, Camps Bay proudly managed by LKPM
Experience personalized property management with a focus on attention to detail. Discover the difference we can make for your community.

For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Tel: 021 903 3101

Tenant vs Landlord: Early lease termination dispute

A tenant wants to break their lease agreement early due to a job relocation, but the landlord insists on enforcing the full term of the lease. The tenant is seeking advice and wants to know what their rights are under South African law if they need to terminate a lease early due to a job relocation, and what penalties might apply?

In South Africa, tenants have certain rights and obligations when it comes to the early termination of a lease. These rights and potential penalties are governed by the Consumer Protection Act (CPA) 68 of 2008 and the Rental Housing Act 50 of 1999.

Rights to Early Termination under the CPA:

Section 14 of the CPA provides tenants with the right to terminate a fixed-term lease prematurely by giving 20 business days written notice. This applies even if the lease agreement itself does not provide for early termination. The tenant will however remain liable for any amounts owed to the landlord in terms of the lease agreement up to the date of cancellation.

A distinction must be drawn between tenants who are natural persons and those who are juristic persons. Section 14 does not apply to transactions between juristic persons.

Penalties for Early Termination:

While the CPA allows for early termination, the landlord is entitled to charge a "reasonable penalty" for the early cancellation. The amount is not fixed and can vary depending on several factors, including:

The remaining period of the lease.
The effort required to find a new tenant.
The loss of rental income during the period it takes to find a replacement tenant.
Any other reasonable costs the landlord incurs due to the early termination.

In some cases, the landlord might use the tenant's security deposit to cover the reasonable penalty or any unpaid rent.

Reasonableness of Penalty:

The concept of "reasonable penalty" is not strictly defined and can sometimes be a point of dispute between tenants and landlords. If the penalty seems excessive, tenants have the right to challenge it. The Rental Housing Tribunal or Court can be approached for mediation if there’s a disagreement.

Special Considerations for Job Relocation:

Job relocation in and of itself is not a valid reason for early termination, unless specifically provided for in the lease agreement.

Potential Negotiations:

Tenants can try to negotiate with the landlord to either reduce the penalty or find a suitable replacement tenant to mitigate costs. Good communication and a mutual understanding can sometimes lead to a more favourable outcome.

Dispute Resolution:

If there’s a dispute over the penalty or any other issue arising from the early termination, tenants can approach the Rental Housing Tribunal or Court for resolution.

In summary, while South African law does provide tenants, who are natural persons, with the right to terminate a lease early due to job relocation or otherwise, it also allows landlords to impose a reasonable penalty for such early termination.

Tenants should review their lease agreements, communicate with their landlords, and seek legal advice or mediation if necessary to ensure a fair resolution. If mediation fails, either party can seek legal recourse through the appropriate channels, such as the Rental Housing Tribunal or the Courts. It is important for both landlords and tenants to seek legal advice and understand their rights and obligations before pursuing legal action.

Source: Property24

Whether you own a residential, commercial or mixed-use
property, we have the expertise to meet your unique needs and challenges.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

At LKPM we proudly deliver personalised and professional sectional title management and homeowners association services. Our diverse and dedicated team of professionals work tirelessly to ensure that you have confidence and peace of mind that your property investments are on track. Together they bring a wealth of knowledge, skills, and passion to their roles, ensuring that we provide great service and support to our valued clients. Whether you own a residential, commercial or mixed-use property, we have the expertise to meet your unique needs and challenges.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

Home Owners Associations and Tax: Your obligations to SARS
By Ané de Klerk

Last month, I unpacked what bodies corporate must do to tick all of SARS’s boxes. (If you missed it, you can read it here) and, after receiving positive feedback and further questions surrounding Home Owners Associations’ (“HOA”) obligations in this regard from our readers, this follow-up article will focus on the tax obligations of HOAs.

As was the case last month, this article does not constitute financial advice, but focuses on SARS Interpretation Note 64, presenting its content in a way that is easy to read and understand.

FIRST, WHAT OBLIGATIONS DOES AN HOA HAVE TO SARS?

HOAs must lodge an application with the Commissioner at the SARS Tax Exemption Unit to qualify for exemption from income tax under section 10(1)(e)(i)(cc) of the Income Tax Act.

The commissioner will assess the application together with the HOA’s founding document and any amendments made thereto and, in doing so, pay special attention to whether:

1)the HOA’s sole objective is to manage the collective interests common to all its members, which includes expenditure applicable to the immovable communal property and the collection of levies for which such members are liable;

2)the HOA is prohibited from distributing its funds to any person other than to a similar association of persons;

3)on dissolution of the HOA, its remaining assets must be distributed to a similar association of persons that is also exempt from income tax under section 10(1)(e).

It is important to note that an HOA must pay tax on all its receipts and accruals unless it has received approval from the Commissioner to be deemed exempt.

WHAT TO TAKE INTO ACCOUNT WHEN DETERMINING THE HOA’S INCOME TAX PAYABLE

If approved by the Commissioner, any receipts and accruals, other than levies derived by a home owners association, up to R50 000 (fifty thousand rand) is exempt from income tax.

As amounts of differing natures are paid into HOA’s accounts, it is imperative to know which of these can be declared exempt and which are always subject to income tax:

EXEMPT (ONLY IF SO APPROVED BY THE COMMISSIONER):

1)General Levies (covering the day-to-day costs of managing and maintaining the association);

2)Special Levies (often raised to fund the upgrade of the association’s communal property);

3)Building penalty Levies (usually levied against a member for their failure to start or complete building works on their erf within a specified period);

4)Penalties levied for repairing damage to communal property as a result of building works (such as heavy construction vehicles damaging the road);

5)CSOS Levies;

6)Stabilisation Fund Levies (sometimes established to subsidise normal expenditure or to build a healthy reserve fund), but only if the HOA’s founding document (such as the Constitution or MOI) stipulates:

*that such a stabilisation levy fund must be created and maintained;

*that the stabilisation fund levies may only be used to defray expenditure of the immovable communal property governed by the HOA;

*that the stabilisation fund levy is a charge imposed by the HOA on the member (if it is payable as an exit levy when the member alienates their property then it must be specified that the exit levy is a liability due by that member upon alienation);

*how the amount payable to the stabilisation fund is to be determined.

THE BASIC EXEMPTION

If approved by the Commissioner, the first R50 000 (fifty thousand rand) of income derived from the non-exempt types of income listed above will not be taxed. So the first R50 000 in fines, penalties, rental income, income from services rendered and interest charged and earned will not be taxed.

EXPENDITURE ATTRIBUTABLE TO INCOME

In addition to the basic exemption, allowable expenditure attributable to the items listed as non-exempt items above must be subtracted from that income before the amount payable to SARS is determined. These include:

1)Bank charges proportionate to the non-exempt income; and

2)Audit fees proportionate to the non-exempt income.

THE CALCULATION

If the Commissioner has ruled that the income tax exemption applies to the HOA, its taxable income is calculated as follows:

Non-exempt income – R50 000 – allowable expenditure = taxable income.

That taxable income is then taxed at the prevailing company tax rate (28% at the date of this article).

IMPORTANT TO NOTE

In closing, it is important to note that Section 10(1)(e) stipulates that a HOA is only exempt from normal tax as long as it:

*is not knowingly a party to, and

*does not knowingly permit itself to be used as part of

liability for any

*tax,
*duty or
*levy

which would have been payable were it not for the transaction, operation or scheme.

This means that the exemption does not apply to any HOA that knowingly is or becomes a party to an arrangement with the main or sole purpose of reducing, postponing or avoiding their tax liability (including their liability to pay donations tax, income tax, dividends tax, VAT and/or transfer duty).

Source: The Advisory. Specialist Community Scheme Attorney (BA, LLB), Ané de Klerk, is a Director of The Advisory, a boutique consultancy specialising exclusively in community schemes law.

Whether you own a residential, commercial or mixed-use
property, we have the expertise to meet your unique needs and challenges.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

A Guide to Fair Wear & Tear: What is fair wear and tear?

Fair wear and tear is the gradual deterioration or 'damage' that occurs to the condition of the rented property and its contents, fixtures and fittings through a tenant's normal and reasonable use. Tenants are expected to return a rented property to its original state when they vacate, but this is not always possible when items in a home naturally degrade over time. These items are not considered to be damaged if they have aged according to a normal timeline.

So when you assess fair wear and tear at the end of the tenancy you must make allowances for the:

Age, quality and condition of any item at the start of the tenancy
Average useful lifespan of the item. Was the damage caused by everyday use?
Reasonable expected usage of such an item
Number and type of occupants in the property
Length of tenancy.
Was the discolouration caused by natural fading over time?
Does the item in question normally wear out over time?
Should the answer to any of these questions be “no” it is likely that the tenant will be responsible for repairing the relevant item.

A general rule of thumb is that if damage is caused by a tenant to the property regarding something that does not normally wear out, or the tenant, due to their actions substantially shortened the lifespan or something (that does wear out), the tenant may be held responsible for the cost thereof by utilising the deposit or part thereof paid by the tenant.

Wear & Tear

Paint that has faded in the ordinary course of use
Plaster that has cracked as a building settles
Carpets worn as the result of being walked on
Blinds and curtains that have faded because of the sun
Loose grout
Small indents where door handles meet the wall

Damage

Windows damaged as a result of being slammed
Walls damaged due to nails or screws
Paint discoloured as a result of cigarette or candle smoke
Carpets discoloured due to pets or stains, or burned by ci******es
Kitchen counter tops scratched due to cutting
Rips or holes in curtains
Blocked drains as a result of hair, food, or other improper items entering the system
Cracked tiles

Damage is caused by negligence or inappropriate actions by the tenant, such as making holes in walls or blocking drains with food. Repairs are needed because items have been used incorrectly, or without care.

Tenants need to ensure that all damages made to the property are repaired before they exit, or they will not receive a full security deposit refund. The landlord may use the security deposit to fix any items that require attention, repair or replacement, before returning the balance.

Complete an inventory

To help you assess whether any damage is in excess of fair wear and tear, an inventory check should be completed and agreed upon with the tenant at the start of the tenancy. The inventory should document the items' condition with photos to prove this, which you can then compare at check-out.

You should also keep receipts for all the items that you have purchased or invoices from any work you have done. This will count as proof of age and help you cover all bases should you get into a deposit dispute with your tenant.

Source: Propertymark.co.uk, Property 24

At LKPM we proudly deliver personalised and professional sectional title management and homeowners association services. Our diverse and dedicated team of professionals work tirelessly to ensure that you have confidence and peace of mind that your property investments are on track. Together they bring a wealth of knowledge, skills, and passion to their roles, ensuring that we provide great service and support to our valued clients.

Whether you own a residential, commercial or mixed-use
property, we have the expertise to meet your unique needs and challenges.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

Estate Living: Common property play areas

One of the advantages of living in an estate or complex is the fact that you and your family benefit from shared facilities on common property, such as clubhouses, swimming pools or play areas. While these can be a huge bonus – especially with kids at home during the school holidays – they do come with some inherent risks that should be borne in mind by parents and explained to children.

Jungle Gyms

Climbing frames, slides, swings and other equipment exert a powerful pull over children of all ages. They are a great way to burn up a lot of energy in a relatively confined space, and imaginative kids will transform them into castles, spaceships and pirate vessels.

Even the best jungle gyms can be hazardous to kids, with perhaps the most serious risk being injuries associated with falling from height. These can range from a bump on the head to something more problematic, up to and including broken limbs.

Other possible accidental injuries including splinters from wooden equipment, bruises and grazes from falls, and cuts from glass or sharp edges. Many if not all these risks can be removed by regular inspections and maintenance.

In particular, check that the bolts and screws holding equipment together are firmly tightened, with no protruding ends. Look for splinters and nail heads that could cause painful cuts, and ensure any wooden elements are sanded smooth.

Check that vertical components are firmly planted in the ground, and that any ropes are in good condition. Look to see what hazards may exist in the immediate area – and just beyond it, especially when kids are playing on swings or slides.

Any litter should be removed immediately – especially if it consists of glass bottles. In fact, a strict “no glass” policy should always be in place. Providing bins and signs can encourage good behaviour when it comes to the proper disposal of litter.

If the play area in your complex has a hard surface like flagstones or tarmac, the risk of injuries will be much greater. In these cases, you can try submitting a request to your Body Corporate / Homeowners Association (Or Managing Agent) to replace such a surface with rubberised matting or bark chips – this will make any falls less serious, and reduce the risk of minor injuries, too.

Any injury risks should be reported to your Body Corporate / Homeowners Association for immediate attention and pointed out to other parents and their kids.

Who’s watching your child?

Accidents can happen in the blink of an eye, so it is vital to always supervise children in play areas. Spending time with your kids at the play area should never be seen as a chore; rather, it is a chance to spend quality time with them. You will be surprised and delighted at how imaginative they can be, and there is nothing quite like the sound of happy laughter to give your mood a boost and relieve stress!

If you cannot be there yourself, arrange with a trusted adult neighbour to do supervision duties instead – then return the favour. While it may be tempting to ask older children to watch their younger siblings, this is never ideal. They could easily get absorbed in their phones and lose focus, and when you have children of different ages in the same area, there is the risk of bullying or of teenagers teaching inappropriate behaviour to younger kids.

As well as being fun for both parents and children, supervision means that you can encourage your kids to explore their capabilities but also ensure that they do not try and get too brave! Kids do not always understand their own limitations – another reason to always have a responsible, alert adult on hand.

Stranger danger

Especially in larger estates, you may well not know all your fellow residents – or the people they invite inside, whether for personal or professional reasons. The sad truth is that this means that unsupervised children are at risk from adults with very disturbed intentions. We do not want to make you paranoid, but child sexual abuse and even abductions are sadly a reality.

Sexual offenders will be watching out for unsupervised children – they will see this as their chance. Make sure that they never get that opportunity by actively supervising your kids, and by teaching your children to always say no to strangers, and what to do if they are approached or are made to feel uncomfortable.

By taking these risks into account, and by being more aware of where your children are, what they are doing, and who else is around, your whole family can spend many happy and risk-free hours together at your complex’s play area.

Disclaimer: Kindly note that the above article is merely for information and is not intended to be comprehensive nor to provide legal advice. LKPM, its employees and agents can in no way be held liable for the accuracy or otherwise of the contents of this article, or for the consequences of any action taken or not taken by any person or organisation based on the contents herein.

Source: Solver Property Services and Addsure.co.za

At LKPM we proudly deliver personalised and professional sectional title management and homeowners association services. Our diverse and dedicated team of professionals work tirelessly to ensure that you have confidence and peace of mind that your property investments are on track. Together they bring a wealth of knowledge, skills, and passion to their roles, ensuring that we provide great service and support to our valued clients.
Whether you own a residential, commercial or mixed-use
property, we have the expertise to meet your unique needs and challenges.
For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

At LKPM we proudly deliver personalised and professional sectional title management and homeowners association services. Our diverse and dedicated team of professionals work tirelessly to ensure that you have confidence and peace of mind that your property investments are on track. Together they bring a wealth of knowledge, skills, and passion to their roles, ensuring that we provide great service and support to our valued clients.

Whether you own a residential, commercial or mixed-use
property, we have the expertise to meet your unique needs and challenges.

For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za

Managing rentals from afar: Expert advice

“There are two vital parts to managing rentals when the landlord is in a different country, province, or area,” says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa. “The first is to hire a reliable managing rental agent who can handle all the day-to-day operations, tenant interactions, maintenance, and emergencies,” says Goslett.

After finding the correct professional, he recommends setting clear guidelines and expectations for your property manager regarding maintenance, payments, and reporting issues. “Being upfront and clear about your expectations will help to avoid any misunderstandings about who was meant to be responsible for the various tasks.”

The next vital part is to ensure that the tenant is properly screened to minimise the risks of rental arrears or misconduct. Arrange with your rental agent to screen the tenants carefully to ensure they are reliable and responsible. “The last thing you want is to be dealing with a reckless tenant who causes damages or neighbour complaints while you are out of the country,” he mentions.

That being said, damages and regular wear and tear will occur on any rental home. These can be tricky to manage from afar, so Goslett recommends that landlords establish relationships with reliable local contractors for regular maintenance and emergency repairs. “Arrange for your managing agent to conduct periodic inspections to ensure the property is being maintained properly. It can also be useful to implement a preventative maintenance schedule to avoid major repairs, as these can be tricky to oversee effectively from afar,” he notes.

Especially if you are living in different time zones, Goslett adds that it can be useful to provide tenants with a list of emergency contacts for issues like plumbing or electrical problems. Your managing agent should also be the emergency contact person who can handle these situations on your behalf.

By hiring competent local professionals and maintaining clear communication, Goslett says that you can effectively manage rental properties from a distance. “Thanks to online calls and video technology, it is no longer necessary to limit your property portfolio to your immediate surroundings. When done right, diversifying your portfolio in this way can safeguard your returns and bolster your income.”

In a previous article Abrahams & Gross’s Litigation and Dispute Resolution attorney, Henno Bothma discussed the important of a lease agreement and shared, for a landlord, renting out their property can be an excellent source of income, but it also comes with a degree of risk. To mitigate this risk, it is crucial to have a proper lease agreement in place to protect yourself and your property.

Bothma shares a few tips:

What is a lease agreement?

A lease agreement is a legally binding contract between a landlord and a tenant that outlines the terms and conditions of the rental arrangement. A well-drafted lease agreement should cover all aspects of the tenancy, including rent, security deposit, maintenance responsibilities, and tenant obligations. It should also provide a framework for resolving disputes and terminating the tenancy.

Why does a landlord need a watertight lease agreement?

Having a proper lease agreement is essential for landlords for several reasons. Firstly, it helps to establish a clear understanding between the landlord and the tenant about their respective rights and obligations. This can help to prevent misunderstandings or disputes that may arise during the tenancy.

Secondly, a lease agreement can protect the landlord’s property by setting out guidelines for maintenance and repairs. This can help to ensure that the property is maintained in good condition and that any damages caused by the tenant are addressed promptly.

Thirdly, a lease agreement can provide a framework for resolving disputes that may arise during the tenancy. This can help to minimise the risk of costly and time-consuming legal proceedings.

Fourthly, a lease agreement can help to protect the landlord’s financial interests by specifying the terms of rent payments, late fees, and security deposits. This can help to ensure that the landlord receives the rent on time and is adequately compensated for any damages or unpaid rent.

A sound lease agreement is essential

In summary, a well-drafted lease agreement is essential for landlords to protect themselves and their property. It provides a clear understanding of the terms and conditions of the arrangement, establishes guidelines for maintenance and repairs, provides a framework for resolving disputes, and protects the landlord’s financial interests.

Speak to a legal expert

As a landlord, it is important to seek the advice of a legal professional to ensure that your lease agreement complies with all relevant laws and regulations, and is tailored to your specific circumstances.

Article reference: Property24

Whether you own a residential, commercial or mixed-use property, we have the expertise to meet your unique needs and challenges.

For expert advise and assistance contact:
Louis Kruger
Mariza Pretorious
Adelle Van Tonder
LKPM House
8 Spruit Street
Kuils River
Tel: 021 903 3101
www.lkpm.co.za