FAQs: Rent Increases (Part Two)

Property Management,  Property Managers

The Property Management Support Service (PMSS) team fields up to 100 calls a week from REIQ members seeking clarity on certain topics – with rent increases the trending topic of late. Have a topic you’d like us to cover in an upcoming edition of the PM Update? Email us at pmsupport@reiq.com.au! 

Q: The vacancy rate is really low in our area. The current tenants 12 month tenancy agreement is due to expire in the next few months, and the owner is requesting the rent to be increased significantly when we offer another 12 month fixed term agreement. Can this be done? 

A: Any rent increase should be supported by a Comparative Market Analysis (CMA). If the CMA suggests that a tenant would pay a similar amount in rent for a property this indicates the new terms offered for a new agreement are consistent with current rental market conditions. 

Q: What if the tenant thinks the rent increase is excessive? 

A: If the tenant believes the rent increase is excessive, section 92 of the RTRA Act states they can apply to the Tribunal for an Order regarding the increase.  See the extract below: 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q: The owner wants to offer a 12 month fixed term agreement, and then include a special term stating the rent will be increased quarterly by $5.00 per week. Is this allowed? 

A: No. Rent can only be increased if it’s been six months since the last increase, or six months since the start of the tenancy. Tenancy agreements must clearly outline that rent will be increased – with the increased amount (or how the increase will be calculated)Property managers/owners must also give tenants two months notice in writing, stating the new amount and the date the increase takes effect, even if the tenancy agreement already allows for the rent increase. 

Note: ThLegal Profession Act 2007 (Qld) prohibits agents from drafting special terms. If you are inserting a special term, ensure it is one drafted by a legal practitioner, or alternatively, Realworks users can access special terms to include in the Form 18a under the Annexure tab. 

Part one of this article featured in the Property Management Update in 2020. For more FAQs, click here.

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