FAQs rent increases

Q: The tenant is on a periodic tenancy, how much notice is required to give an increase?

A: The rent can be increased with a minimum of two months' written notice. The notice could be given to the tenant at any time, but the rent increase cannot commence sooner than 12 months after they started paying the current rent amount.

Q: The tenant is on a fixed term tenancy, can I increase their rent during their fixed term?

A: Yes, but only if the below criteria are met:

• the rent increase was included as a special term of the signed tenancy agreement from the very beginning, stating when the rent would increase and the amount of the increase or how this is to be worked out;
• a minimum of two months' written notice is provided; and
• the increase doesn't commence sooner than 12 months from the date of the last rent increase for the property, regardless of whether there has been a change of tenant or lessor within this period.

Q: We have a new tenancy on a six-month agreement. At the end of the agreement we are negotiating a further six-month agreement with the same tenants, can we increase the rent?

A: No. A rent increase cannot commence if it is sooner than 12 months after the date of the last rent increase for the property.

Q: The tenant is on a fixed term agreement which expires in a few days' time. The owner has only just instructed me to have a new agreement signed at a higher rent. Do I have to give the tenant two months' notice?

A: You don't have to give the tenant two months' notice if they sign a new agreement with the higher rent before the expiry of the current agreement. The two months' notice only applies to a rent increase for a periodic tenancy, or for a rent increase coming into effect during the term of a fixed term agreement. Best practice is to give the tenant as much notice as possible. However, if the tenant signs the new tenancy agreement, then whatever rent is stated in Item 7 will be payable from whatever date is stated in Item 6.2, even if that is immediate.

Q: Is there a particular form used to notify a tenant of a rent increase?

A: There's no form provided by the RTA, but the notice must state:

• the amount of the increased rent;
• the day from when the increase is payable; and
• the date of the last rent increase for the property (unless the lessor is exempt).

A lessor is an exempt lessor if—

• the lessor receives funding for the premises under the Housing Act 2003 if the amount of rent payable for the premises is determined by household income (for example, a community housing provider or specialist homelessness service); or
• the lessor receives funding for the premises that is the subject of a funding declaration under the Community Services Act 2007 if the amount of rent payable for the premises is determined by household income; or
• the lessor is the chief executive of the housing department, acting on behalf of the State; or
• the lessor is the State and the tenant is an officer or employee of the State; or
• the lessor is the replacement lessor under a community housing provider tenancy agreement; or
• the lessor is prescribed by regulation to be an exempt lessor.

The REIQ has created a template form which is available in Realworks.

Q: Can a tenant object to a rent increase?

A: Yes. When a tenant is notified of a rent increase, they can make an application to QCAT within 30 days (and before the end of the fixed term). QCAT must have regard for the types of issues mentioned in Section 92(4) of the RTRA Act.

Q: Can the bond be increased in line with the rent increase?

A: Yes, the bond may be increased if it's been at least 11 months since the last bond increase or the start of the tenancy. Any extra bond must be lodged with the RTA using a Bond lodgement (Form 2) or through the RTA's Bond Lodgement Web Service.

Q: What sections of the RTRA Act cover rent increases?

A: Sections 91, 92 and 93.

REIQ members seeking further advice on this topic or others can email the Property Management Support Service at ask@reiq.com.au citing their membership number to receive a call back. Not a member? Join us today!

REIQ members can also access the REIQ New Tenancy Laws Toolkit which provides examples of how to calculate and apply rent increases compliantly.

Read another property management article: How much notice is required to end a management agreement?

Or browse our suite of articles.