12 Practical Tips and Tricks for Rental Contract Negotiations in Israel (Part I)
You are about to rent an apartment. A person purporting to represent the landlord presents you with a single sheet of paper and shows you where to sign on the dotted line (“it’s just standard wording,” he assures you). What should you look out for to protect your interests?
Proper power of attorney and absentee landlord
First, insist on seeing an original Power of Attorney document, to verify that the agent has actual authority to sign a rental contract with you on behalf of the landlord. This should be notarized, and if obtained outside of Israel also apostilled.
Property inspection before signing lease
Prevention is better than cure: especially if the apartment is old (and in particular if you plan on living in it for more than a few months), consider undertaking a property inspection through a reputable engineer. Points to check include the presence or likely appearance of mold/dampness (retivut) on the walls, any leaky taps/toilets (you will be responsible for paying the water bills), whether the fuse box is capable of bearing all of your appliances, etc. It is recommended to list and even photograph the apartment and furnishings before entering into it (e.g. if a hinge on the door of a cabinet is not working), to avoid arguments (and attempts to forfeit your security check) at the end of the tenancy period, over whether you have restored the apartment and any furnishings in it to the state it was in at the time you moved in.
E-mail as valid form of communication
Especially in the case of an absentee landlord, make sure the contract includes a clause stating that e-mail is a valid means of communication between the parties, and specifying the parties’ e-mails for this purpose.
Rent in advance
Try to avoid paying more than 1 month’s rent in advance. Request a 7 day grace period which allows you to pay rent within 7 days of the contractual due date without breach of contract.
If you think you may be interested in continuing the tenancy for 1 further year (or longer), you should request that an option-to-renew clause be inserted in the agreement. This will enable you to continue to rent the apartment on the same terms – including at the same rental, or at a rent to be increased by ___% – provided you do not breach the terms of the rental agreement during the initial rental period. This arrangement will often be beneficial to the landlord too, because it saves him the heartache of having to find an alternative tenant, including, possibly, time during which the apartment may go unrented, and including the cost of advertising for a new tenant. In addition, if a mechanism for increasing the rent is already inserted into the original contract, the contract can be renewed automatically, without the need for further lawyer’s fees, etc.
Premature termination of lease
If the contract stipulates that the landlord has the right to give ___ days to terminate the lease prematurely, the tenant should insist on being given the same amount of time to break the lease should this prove necessary. If the lease is for a defined term (e.g. 1 year), try and get out of the need to find a suitable alternative tenant for the remainder of the term, in the event that the lease requires premature termination (e.g. after trying, unsuccessfully, for a maximum period of two months). If you are required to find a replacement tenant “suitable to the landlord,” be sure to qualify this with the words: “provided that the landlord shall not unreasonably refuse his consent to such alternative tenant.”
Part II to follow!
For further advice on rental contracts, feel free to contact Simon on 0737-40-60-40 / 0545-742-374 / [email protected]