Rising rents can cause tension between landlords and tenants.
Mum-and-dad property investors should be cautious when deciding whether to raise rents. There are different rules for rent increases in each state.
If you intend to increase rents for tenants, the following rules will apply to each state/territorial:
(Disclaimer: The rules could be altered depending on local circumstances. These guidelines will take effect April 2022.
Australia has laws regarding rent increases
- New South Wales
- Western Australia
- South Australia
- Northern Territory
- Australian Capital Territory
New South Wales
New South Wales has many situations in which landlords might increase their rents for their rental properties.
Landlords can increase tenancies that are less than two years old only if they specify how and the amount.
NSW Fair Trading says that the agreement must clearly specify the amount and the method of increasing (e.g., dollar amounts). A dollar amount (or %) Conditions should not include “in line with the market” or “by the rate of inflation”.
The landlord or agent does not have to inform the tenant by way of a written notice.
Fixed-term tenancies of more than two years cannot have rents increased. Landlords must notify tenants in writing at least 60 days before the rent is increased.
This rule applies regardless if the agreement has a fixed term or a fixed duration. The agreement then becomes continuing/renewal.
Without an agreement, landlords cannot raise rent during the first six months of a tenant’s tenancy.
If there have been excessive rent increases, you can contact the NSW Civil Administrative Tribunal.
Fixed-term leases do not allow renters to increase rents. The agreement must state clearly how the rent will be increased if this is the case. The rental provider must inform the tenant in writing that they will increase the rent at least 60 days in advance.
Rent agreements that were signed after the 19th June 2019 deadline are not allowed to be renewed. For agreements that were signed prior to this date, rent increases are allowed.
Notices of rent increases after March 28, 2021 should indicate the method of calculation in any new lease agreements.
If the lease allows rent rises during its fixed term, it must state how they will be calculated. Rent increases that exceed the amount allowed by the lease must not exceed the fixed amount.
Tenants have thirty days to contest any rent increase with the Victorian Civil and Administrative Tribunal.
Rents cannot be increased in fixed terms like other states. This must be stated in an agreement. The agreement must indicate whether or not rents are going to rise and what the amount. Queensland Landlords are required to give written notice to tenants within 2 months. The tenant must receive written notice within two months of commencement of tenancy or prior increase.
The property manager or landlord also has to give the tenant separate written notice of the rent increase – it will not automatically come into effect just because it’s in the agreement. The notice must include the amount of the rent increase and the date it takes effect.
This is true for periodic agreements and tenancies that go beyond the term.
A rent increase can be agreed upon by landlord and tenant for any new contracts that are not fixed-term. It must be at the least six months prior to the previous increase. This arrangement does not require a notice.
The Queensland Civil and Administrative Tribunal will decide disputes involving excessive rental.
Landlords must get approval from the state’s Department of Commerce for any written notice of increase, and this must be given to the tenants 60 days prior to its implementation.
Rent increases are not allowed after six months of a tenant agreement or six months since the last rent increase under periodic leasing agreements. Property owners can’t increase rent under a fixed-term arrangement if the contract doesn’t specify the method or amount.
Tenants can apply to the state’s Magistrates Court for the rent to be changed if they deem it excessive.
South Australian tenants must be notified by writing 60 days prior to the actual implementation or rent increases. Lease agreements made before March 2014 are not eligible for rent increases by landlords. For most leases, landlords cannot raise rent after March 2014. However, they can do so once every 12 months or one-year from the date of the agreement.
The South Australian Civil & Administrative Tribunal (SACAT) handles tenant issues regarding excessive rent.
Tasmanian property owners must give tenants a notice in writing within 60 days stating the new rent and the date it takes effect. Changes or rent increases must be made within 12 months of the last increase or date of lease agreement’s beginning.
Tenants have 60 days in which to lodge a complaint with Residential Tenancy Commissioner.
NT residential rental laws only require a written notice of any rental increases within 30 days. It must clearly mention the amount and date. Property owners can increase rent payments up to six months after the tenant starts. The property owner may allow any subsequent increases up to six months after the tenant has started. The terms for any increases in fixed term leases must be stated in the rental agreement.
The Northern Territory Civil and Administrative Tribunal has the responsibility of reviewing and taking action on tenant complaints regarding rent increases.
Australian Capital Territory
Landlords in the ACT are required to give eight weeks’ notice to tenants of any increases in rent, which can only be done once every 12 months on a periodic lease. Fixed-term leases do not allow rent increases unless the contract clearly states the amount.
Tenants who believe that they have been handed an excessive increase can write to the ACT Civil and Administrative Tribunal (ACAT) to apply for a review.