7 Valuable Tips for Renters in Israel

Here are some practical tips that can substantially improve your next rental contract:

Option Period – try adding an option to extend the rental period. Adding an option can be worthwhile even if the landlord insists on increasing the rent during the option period. Keep in mind that if the increased rent turns out to be higher than the going market rate, you can always choose not to exercise the option (i.e. move out and find a different rental), or you can try to renegotiate the rent increase. If you’re a good tenant, the landlord may prefer adjusting the rent to market standard rather than losing you and having to search for a new tenant. Also, when deciding on what would be a reasonable rent increase for the option period, don’t forget to factor in your moving costs and the added frustration involved in finding another rental property.

Tenant Repairs – make sure you are not responsible for fixing ordinary wear and tear (blai savir) and generally try to limit your liability to damages that you caused through negligent use (rashlanut), as opposed to damages you may have caused through reasonable use or damages that were caused by someone or something else altogether. You would be surprised how many rental contracts don’t contain these basic distinctions.

Landlord Repairs – Ideally, the landlord should be responsible for repairing any damages or malfunctions that you are not responsible for repairing. Defining it that way guarantees that nothing gets left out (i.e. it’s either his responsibility or yours) and the more you manage to limit your liability, the broader the landlord’s liability becomes. If this approach gets rejected (as it likely will), then you should at least make sure that landlord remains responsible for repairing any damages or malfunctions that compromise the reasonable use of the apartment (shimush savir). Adding a list of assorted elements that are landlord’s responsibility to fix (e.g. infrastructure, a/c, plumbing, electricity etc.) is a great idea, but make sure it’s clear that the items on the list are examples and not meant to be exhaustive.

Security Deposit/Guarantees – avoid giving the landlord cash or cash equivalent guarantees that he can exercise unilaterally before you have a chance to defend, e.g. security deposit (pikadon) or bank guarantee (arvut bankait). It’s important to know that there are many alternative guarantees out there (e.g. guarantor, security check, postdated check, promissory note etc.), and being knowledgeable about them can be very useful in negotiating with the landlord. More on this in another post, hopefully.

Insurance – make sure the landlord insures the apartment with building insurance (bituach mivne) and that the policy includes a waiver of subrogation in your favor (vitur zchut shibuv). This is important because if you burn down the apartment (god forbid…), you want an insurance company to cover the damages (i.e. building insurance) and you don’t want the insurance company to sue you back after they pay landlord for the damages (i.e. waiver of subrogation).

Additional Payments – make sure you are not responsible for paying non-current or capital expenses. You should only be responsible for paying current payments (tashlumim shotfim) that regularly apply to tenants as opposed to payments that are paid by landlords or owners. For example, if the building committee (vaad bait) decides to pave the front yard or replace the elevators, the landlord should pay for this and not you.

Agreed Penalty – avoid agreeing to pay a fixed penalty (pitzui muskam) for breaching the contract. Most people don’t plan on breaching but breaches can happen and if they do, having an agreed penalty clause in the contract can make your situation that much worse. Keep in mind that even if you didn’t breach the contract, it’s enough for the landlord to claim that you did to instantly force you into a confrontation with him. It’s difficult to stand your ground in a disagreement with the landlord when the contract grants him an agreed penalty and all the more so if the contract equips him with a security deposit or bank guaranty which allows him to collect the penalty at his discretion.

The information presented is not intended to provide legal opinion or advice. Readers should seek professional legal advice regarding the matters about which they are particularly concerned.

About the Author
David heads the Israeli Real-Estate Practice at Gross, Kleinhendler, Hodak, Halevy, Greenberg & Co.
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