📈 Rent going up?
When a landlord can decide to tap their tenants for more income, what can they do?
Sometimes rent rises are justified by things like the cost of living or rate increases.
Other times, it’s harder to be convinced.
According to the most recent Australian Institute of Health and Welfare data, one in five low income households are paying more than one third of their disposable income on rent.
So what can you do if you think your landlord is asking for too much?
🔎 Investigate: According to Tenants Union of New South Wales CEO Leo Patterson Ross, the first thing renters need to do to is gather evidence to argue against a rise by finding out what similar properties in their area are being rented for.
Patterson Ross said it was especially important to know what your neighbours are paying right now – rather than what new listings are going for – as these listings will be more expensive than an ongoing tenancy.
“A lot of people look at realestate.com.au, Domain… but the listing sites are listing new rentals. So that being advertised fresh, they're not for a sitting tenant who has been in there for a year or maybe longer,” he said.
🚪 Knock on doors: Patterson Ross said it’s much harder to find out what other people are currently paying as it’s not publicly available.
“The best strategy is often to go and knock on doors and have friends and, you know, gather the information, but that's not necessarily easy for everyone”, he said.
Sites like flatmates.com.au and Facebook groups can provide an insight into what people are paying at the moment.
🤝 Underbidding: According to the most recent Rent Bidding in NSW Insights report, in Greater Sydney about 10-12 percent of listings were being rented for about $30 to $40 less than the listing price between March 2022 and March 2024.
For the rest of NSW, between six and seven percent of listings were going for $30 less than the listing price in the same time period.
Patterson Ross also flagged both the tenants union and NSW Government have tools to check rental prices by postcode.
🤨 Nicer than mine: Patterson Ross recommended renters take into consideration what other properties have that theirs might not, like a balcony, airconditioning, a pool and solar.
“Are there outstanding repairs? Are there problems with the property that if it was put back onto the open market, people would have a problem with it”, he said.
One thing renters cannot use to argue against a rent rise is personal affordability. Under NSW law, that doesn’t come under consideration.
✉️ Letter writing: In NSW, landlords have to provide tenants a 60-day notice period of a rent increase.
Patterson Ross recommended using the first week to send a letter to the agent of the landlord arguing against the increase, or offering an alternative.
If that doesn’t work it’s time to go to the tenancy tribunal.
🧑⚖️ Tribunal: It costs $62 to take a rent negotiation to the tribunal.
“We'd love to see more people applying for rent increase disputes because… anecdotally, you're more likely to see a reduction than not, particularly if you've actually done the work and done the evidence”, said Patterson Ross.
🏛️ ACT: When it comes to rent rises, Patterson Ross says the ACT model is the best we've got in Australia and could be replicated across the country.
The ACT caps rent increases at the rate of inflation also known as the consumer price index (CPI) plus 10 percent of CPI.
For example, if inflation is 3 percent, the cap is 3.3 percent. If a landlord tries to go above that they have to justify it at tribunal.
“In Canberra, rents have been rising slower. They've got just as healthy a vacancy rate as everywhere else. So it's a system that's working to slow down the level of rents, although Canberra is one of the most expensive cities to start with”.
Thumbnail: AAP