The laws relating to rent increases vary and will depend on the type of tenancy.
Where a tenancy is periodic (no pre-determined finish date) rent increases can occur at six-monthly intervals (but no sooner) and tenant/s must be given at least 60 days notice in writing, with details of the amount of the rise and the day it will take effect. The lessor must use Form 10 or Form 11 available from the notices page. You only have to pay the increase if proper notice has been given.
Rent in a fixed-term tenancy can only be increased if the written agreement specifies how much the rent increase will be or the method of calculating the rent increase is shown (eg by a percentage). If the rent is able to be increased, it can take effect no sooner than six months after the commencement of the tenancy agreement and the date of the last increase. The lessor must give at least 60 days’ notice of the increase.
Increasing the rent where an existing tenant’s fixed lease ends, and they enter a new fixed term tenancy, or the lease becomes periodic.
If an existing tenant/s fixed term lease agreement ends, and they continue to rent the same property on a new fixed term agreement, or if the lease rolls into a periodic agreement, a rent increase cannot take effect for the first 30 days of the new agreement. This means that the tenant will continue to pay rent at the old rate for the first 30 days of the new agreement.
Note: If the rent is calculated by reference to the tenant/s income (e.g. the tenant/s employer provides the rental premises and the rent is set as a percentage of the tenant/s income), a notice of rent increase is only required if the method of calculating the rent is changed
Excessive rent – paying too much?
The amount of rent charged at the start of a new tenancy is generally controlled by market forces, but if the tenant/s believe the rent is too high they can apply to the Magistrates Court requesting a reduction, or to argue against a proposed increase.
The court will consider a range of things, including:
- if the rent remains comparable with other properties in the area;
- the estimated value of the premises;
- the cost of upkeep of the property paid by the lessor;
- the cost of services provided by the lessor (or tenant);
- the value of the contents provided by the lessor for the tenants use;
- the state of repair and general condition of the property; and
- any other considerations (e.g. if the lessor is putting up the rent simply to force the tenant out).
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