The mystery behind the security refundable deposit

Many a time, we have come across property owners grumbling and getting too worried about the security refundable deposit.

The standard norm of collecting 01 month's rent as a security refundable deposit.

The above option is best used when the owner is able to collect a large amount of the rent in advance or upfront. Although it is best advised to screen the client, it is also equally very important to maintain an amazing relationship with the potential tenant as that would minimize a great deal of risk.

The word 'Standard' is mentioned because that has been the standard in the country when it comes to the rentals of homes and apartments and sometimes commercial buildings.

When should you ask for a 03 month's security refundable deposit?

This option is mainly resorted to if the rent is being paid on a monthly basis or the if the number installment payments is higher side. This too is very tricky when it comes to apartments and expats as many expats who are here on a salary tend to limit the security refundable deposit to one month and then pay on a monthly basis from there on. In such instances, it is of utmost importance that the property owner screens the client and if possible, obtains a letter from the potential tenant's employer or gets to touch base with someone known to both parties.

Is it fair to ask for a security refundable deposit of more than 03 months?

It is unfair if you are renting an apartment or house and getting the upfront money as well. Generally, the deposit is high on business premises and not residential properties. Sticking to 01 month is best if you a getting a decent amount upfront or else sticking to 3 month's is okay if the rent is paid on a monthly basis but it's not advised to increase the security refundable deposit just like that. The situation has to be considered and it's always good to be flexible on that.

Is it good to stick to a flat rate?

Some owners like to stick to flat rate as they have this insecurity ingrained in them that the tenant may damage a great deal and there will not be enough to compensate for the negligent wear and tear in the devised premises. In this instance, it might be best advised to stick to a flat rate which could less or more than a month or two of the rent quoted.

Other important aspects to bear in mind when determining the security refundable deposit.

The quality and brand of the furniture in the property plays a major role when determining the amount of the security refundable deposit.

Proper screening of the client, this is the main bit. If this is done properly, you would know how much is a safe figure for you to give out the apartment.

Standard market practice is also advised to be studied and researched so you know you are not making a fool out of yourself.

Seek the advice of a property consultant or property agency and get their input on the matter.

Inventory Checking!!!

Do you check the inventory when you move in? How does this work? Who checks and how do know whether this is not going to cause a problem later on?

Interesting questions indeed!!!

In Sri Lanka, a country where its people extremely hospitable and friendly, things work slightly differently unless you bump into serious, scary and stone-hearted property owners.

As a pre-requisite, the owner should have the inventory prepared. If the inventory is not prepared, a real estate agency could do the job.

In most cases, the inventory is casually run through and it does not take much time to sort the items in the property (if the property is not huge!)

Generally, inside the 1st week, you as a potential tenant must inform the owner of any discrepancies where the inventory is concerned.

If you could do this, then you can be sure there won't be a problem at the end.

If you have any questions regarding the above, please send an email to info.mistert@gmail.com

Thinking of undervaluing the figure on the deed? DON'T!

Many lawyers and property buyers try to play around by undervaluing the figure which is supposed to be placed on the title deed, so a lesser stamp fee is paid to the government.

In some cases, Lawyers also think they know better and advise good, genuine people too place a lower figure on paper.

The reality is that the government officials are not fools, they are way more smarter than we think and understand the game better. At the end of the day, it's the government official (Assessor) that makes the call whether the value is less, too less or just about right.

What happens if they find out you have undervalued? 

Have you ever thought of that?

Chances are that they would make a visit to the property, do a fresh valuation and then place the figure they think is the value of the property and then issue the stamp fee. For the first LKR 50,000/= it's 3% and then for the balance amount it's 2% and on top of that, there is a penalty / surcharge of 15%.

You have to pay that and then they seal the original document which means you have paid the required the stamp duty fee to register the property.

So be very careful and get it right the first time.

Mister T brings reliable clients. TRUST matters more than anything!!!

At Sri Lanka's number 1 Real Estate Agency, there is special emphasis placed on the clients that come in for rentals. Mister T has seen it all. The good clients, the naughty clients and the not so good clients.

The Agency not only has a huge fan base on Facebook but also knows pretty much how to connect the clients in a way where they can screen the clients and advise the owner whether to go for the deal or not. A rare quality among the agents in town.

Sri Lanka is developing at an amazing pace and more and more deals are hitting the table allowing more and more people to get in and share a piece of the cake, at Mister T, we value the relationship more than the money as we are here to stay.

Get in touch with the Agency if you are interested to work with them and enjoy a fruitful experience.

The Tranquility - Hottest Deal in Town - BOOK NOW!!!

The Tranquility is designed by a Geoffrey Bawa Award Winning Architect 

PROJECT DETAILS

A total of 11 properties with 08 apartments, 02 penthouses and 01 villa along with a roof top with luxury facilities. Built on a 22 perch land with tight security in a peaceful and serene neighbourhood, The Tranquility is the epitome of a fantastic holiday hideaway not too far from the city of Colombo in a classy location.  The floor plans are as follows:

APARTMENTS 

 

PENTHOUSES

VILLA

ROOF TOP ARRANGEMENT

Other Information

• The project is approved by Sampath Bank and loan facilities could be arranged. 
• The apartments are very spacious as opposed to many of the same complexes in town.
• The prices are very reasonable and are bound to shoot up in the years to come. 
• The project is expected to be complete by 31 July 2016.
• The payment plan is very flexible and buyer-friendly.
• The fittings and finishes are of high quality. 

You can find out more details if you visit www.thetranquility.lk

Please feel free to contact Mr. Adam on +94 767 582 458 should you require any further information on the above project.

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