How to Handle a Rent Increase

When you rent a property, you pay rent either weekly, fortnightly or monthly, and a rental increase occurs when the landlord or property owner increases the repayment amount.

This can occur at the end of your rental contract. For example, if you have lived in the property for 12 months and your contract is ending, your landlord may offer to extend your contract for another 12 months with higher rent.

Rental increases can also occur during the contract period. This depends on the state you live in and the contract itself. However, there are regulations in each state that dictate how often a landlord can increase the rent.

Unfortunately in Australia, there is no legislation regarding how much rent can be increased. And, if you are at the end of a contract, the landlord has more flexibility to increase the amount.

Reasons why a landlord may increase rent include:

The market has risen and similar properties in the area have increased rent
The value of the property itself has increased due to renovations or improvements
Interest rates have risen and the owner’s mortgage repayments have increased
The tenants have requested new amenities like air conditioning or a carport.

» MORE: Ways to save money on a tight budget

How to read a rent increase notice

In most states and territories, a landlord can only increase the rent during the tenancy period if stated in your contract. If you do receive a rental increase notice, it must be in writing 60 days (two months) before the increase will take effect in every state except the Northern Territory which requires only 30 days notice.

This makes it extremely important to carefully read your contract when you move into a rental property. If you want to avoid rental increases during your tenancy, you need to make sure it is in the contract.

The rental notice will include how much the rent is set to increase, and the date this comes into effect. In some states, it must also include how the increase is measured.

» MORE: Lease vs. rent: What’s the difference in Australia?

How much can a landlord increase the rent by?

Landlords tend to keep their rent hikes in line with the market. There is technically no limit on how much a landlord can increase rent. However, by increasing it by too much, landlords risk having tenants default on their repayments. This can lead to the landlord losing months of income or having difficulty finding new tenants.

Rental increase laws in Australia

Below is an overview of rental increase laws across each state and territory, with links to the official residential tenancy rules for the region.

New South Wales

For renters on a fixed term lease of less than two years, a rental increase can only occur if the agreement specifies the amount or the calculation method.

For renters on a fixed term of more than two years, a rental increase can only occur once in a 12-month period. This is also consistent for renters on a periodic lease.

For more information: New South Wales Residential Tenancies Act

Victoria

For renters on a fixed term or periodic lease, your rent cannot be increased during the term unless stated in the contract. If it does, the landlord needs to give you 60 days written notice.

For more information: Victoria Residential Tenancies Act

Queensland

For renters on a fixed term or periodic lease, your rent cannot increase during the contract period unless stated in the contract. If it is stated in the contract, it can only occur once every six months with 60 days written notice.

For more information: Queensland Residential and Rooming Accommodation Act

South Australia

For renters on a fixed or periodic term lease, rental increases can only occur if specified in the contract. If it is in the contract a rental increase must have 60 days written notice and must reference how it will be calculated (e.g. due to inflation). Rental increases can only occur once every 12 months.

For more information: South Australia Tenancies Act

Tasmania

Renters on a fixed term lease are only subject to increases during the contract period if specified in the contract. They also require 60 days written notice and can occur once every 12 months.

For more information: Tasmania Residential Tenancy Act

Western Australia

Renters on a fixed term or periodic lease are only subject to increases during the rental term if specified in the contract. Increases can only occur once every six months, with 60 days written notice.

For more information: Western Australia Residential Tenancies Act

Northern Territory

Renters on a fixed term or periodic lease are only subject to increases during the rental term if specified in the contract. However, the Northern Territory only requires a 30 day written notice for an increase.

For more information: Northern Territory Residential Tenancies Act

Australian Capital Territory

Renters on a fixed term or periodic lease are only subject to increases if the contract allows it. If there is an increase, the landlord must give eight weeks notice and provide information as to how the increase was calculated.

For more information: ACT Residential Tenancies Act

» MORE: 6 things to know about the Australian property market

What to do if you feel your rent increase is unfair

If you feel the increase is unfair or excessive, you have the right to an assessment from governing authorities in each state. In most cases it will then be up to the relevant body as to whether or not the landlord has the right to increase the rent.

More information can be found below for each state and territory on how to dispute an unfair or excessive rental increase:

You also can access government assistance through Centrelink. There are various options such as rental assistance that are available depending on your individual circumstances. It’s important to note that accessing this assistance is dependent on meeting the requirements as stipulated by Centrelink.

About the Author

Aaron Bell

Aaron Bell is a journalist originally from Brisbane, Australia. With a passion for promoting financial wellness, Aaron prides himself on breaking down complex topics into clear, concise content. He has…

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