Here’s What You Landlord Can And Can’t Do When Increasing Your Rent
There is actually no limit on how much your rent can be increased by.
On top of the already painful cost of living increases hitting Australians right now, tenants across the country are also being bombarded with extreme rent increases.
Regardless of where in the country you live right now, the huge rent increases are serving as a final nail in the coffin for tenants who are already struggling with the cost of living.
But what can you actually do about this, and is it legal?
How Much Notice Does Your Landlord Need To Give You?
Generally speaking, your landlord can’t hike up your rent in the middle of a fixed-term lease. This means your rent should only really be going up if you’re renewing — or if your rental agreement dictates otherwise (always read the fine print).
However, if you’re on a month-to-month (periodical) lease, which is particularly common in Victoria at the end of your first fixed-term, your landlord can increase whenever they like, provided they give you adequate notice.
The specific notice period varies between states but generally is about sixty days.
“The specifics will depend on the state or territory you live in,” Joel Dignam, the executive director of Better Renting, told the ABC. “In a lot of cases, you should get about two months’ notice. If you get a rent increase that will take effect next week, it’s probably not going to be legitimate.”
If you think you haven’t been given enough notice before a rental increase, you can contact your state or territory housing authority to dispute the increase.
How Frequently Can They Increase Your Rent?
Your landlord is also limited in how often they can increase your rent. Generally, this can only be done once per lease — which is usually renewed every six or twelve months, depending on your agreement.
Again, the situation is slightly different on a periodical lease, but if you’re copping rental increases every three months, something is probably not quite right.
Recent laws that changed in Victoria mean you can only have your rent increased once every twelve months, and your landlord must explain how the increase was calculated if it occurs during a fixed-term lease.
How Much Can They Increase Your Rent By?
There is no set amount that your landlord can increase your rent by, as it all depends on the market. However, you can fight any increase that you believe to be unreasonable. The issue here is proving what is actually unreasonable, largely because there’s no national definition of a reasonable rent increase.
Basically, reasonable rent is comparative to other similar properties in your area. If you’re currently paying heaps less than your neighbours, brace for your landlord to hike that right up.
The other major factor influencing rental prices is supply and demand, so if your neighbourhood is popping off, expect an increase. Alternatively, if there are stacks of empty properties in your area, you may have some bargaining power.
Generally, 2-10 percent is considered reasonable, depending on the market conditions. But despite what many of us may think, there is no set limit on how much your rent can go up by.
“People think that there might be a fixed percentage limit or a dollar limit, but these things don’t exist. It’s basically whatever goes,” Dignam told Money Mag. “Most jurisdictions have a process where you can appeal against an excessive increase, but that definition doesn’t take into account what your income is or, really, the quality of the property. It’s all about what’s happening in the rental market more broadly.
“So, if prices are going up all over it’s very hard to oppose a rent increase, which means you have to take it on the chin.”
What Are Your Options?
If your rent increases, either by a reasonable or unreasonable amount, you don’t need to agree to it. You do have options.
Your first port of call should, obviously, be giving your real estate agent a call to try to negotiate it directly with them. Depending on market conditions, your tenancy history and other factors (see: how nice your landlord is), they may agree to a smaller increase — or no increase at all, if you’re really lucky.
If you have no luck there, you can contact your state’s housing tribunal and lodge a formal complaint about an unreasonable rent increase. You generally have 30 days to do this after receiving the rental increase notice, but the onus is then on you to actually prove the increase is unreasonable. This may be easy if your landlord is bumping up your rent by $300/week, but may be more difficult if you’re copping a smaller (yet still steep) increase amid otherwise hectic market conditions.
The tribunal will largely focus on the state of the market, so there usually isn’t much sympathy if you’re living in a city where the market is in absolute shambles (see: every capital city in Australia right now).
Who To Contact
The contact details for each state’s housing tribunal can be found below: