What to do if your rent rises?

Rents are skyrocketing, but there are some steps you can take to make it fair.

Three months before my lease in Sydney expired, I asked my property if they were willing to extend the lease and if there would be a price increase. I kept asking every week and always got the same answer “the owners haven’t told me yet”.

After my lease ended, exactly 21 days before the end of the extra month I paid for (so I couldn’t get a refund), the property dropped that they would ask for a $100 raise. Dodgy and frustrating, yes. Unexpected? No.

With rents rising across the country, while at the same time there is a shortage of available rental properties, many people are stuck between a rock and a hard place. So what are your rights as a tenant?

Why is the rent going up?

While rent increases are nothing new, if you’re wondering why it seems so widespread right now, PropTrack’s director of economic research, Cameron Kusher, says it’s because of supply and demand.

“Rents eventually go up because the demand for rental inventory exceeds the supply,” he told news.com.au.

“While investors have returned to the market, they have been outnumbered by the number of investors selling their properties, largely to owner-occupiers, decreasing the total supply of rent available for rental.

“Rentals dropped significantly during the onset of the pandemic in Sydney and Melbourne and with people working from home in lockdown, many tenants living in shared houses moved into their own rental housing for more space, reducing the overall supply of available rental properties.

“In addition, now that state and international borders have reopened, more and more investors are looking to use short-term leases instead of long-term leases, further reducing the supply of rental inventory.”

What is a reasonable raise?

Unfortunately, there is no national definition of what a reasonable rent increase looks like, but you can get a good idea by looking at the average rents of comparable properties in your area.

So if everything around you is going up by 5 percent, then it makes sense that yours would too (if it’s in good shape, of course). If there is nothing comparable in your area, your real estate may have more power in negotiations.

How often can the rent increase?

This really depends on your state, but in general, it usually can’t happen during the term of your lease.

Speaking to realestate.com.au, chief economist for PRD Dr. Diaswati Mardiasmo that there are some exceptions.

“There may be instances where landlords can increase rent for a period of time, but this must be stated in the lease from the start,” she said.

How much notice period is required?

Again, the laws on this differ from state to state. For New South Wales, Victoria, Western Australia, South Australia and Tasmania, the law generally requires 60 days’ notice for a rent increase. Queensland is basically the same and requires two months, the ACT requires only eight weeks and only 30 days are needed in the Northern Territory.

It is never legal to backdate the increased payments.

Can you negotiate?

You can try, but you have to be much more prepared than I was. Kasey McDonald, head of leasing at property management firm: Different, told realestate.com.au that you need a good knowledge of other real estate prices in your market and that you can justify why you think the rent increase is not fair.

You can try to negotiate the price or find other ways to compromise, such as offering to sign a longer lease at a lower rent, or offering to make home improvements out of pocket in exchange for an equal lease. rent.

Whatever you try, McDonald advises you to remain calm and polite.

Where to find help?

If you think your rent increase is unjustified, but your landlord won’t budge, there are resources available for you.

Most states and territories have civil and administrative courts where tenants can sue for an injunction that the new rent is excessive. In Western Australia, tenants can apply for that decision at the Magistrate’s Court.

In Victoria, tenants can contact Consumer Affairs within 30 days for a rental assessment and Tasmania may request the Residential Tenancy Commissioner for an assessment.

If those sources come back with a statement that the rent is unreasonable, you have a much stronger case to negotiate.

Read related topics:Sydney

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