Changes in Tenancy Laws Affecting Rent Increase
The Real Estate Institute of Queensland (REIQ) has released a guide on what Landlords need to know about the changes in tenancy laws affecting rent increase.
On 18 April 2023, the Deputy Premier verbally introduced amendments to the Local Government Electoral and Other Legislation (Expenditure Caps) Amendment Bill 2022 to amend the Residential Tenancies and Rooming Accommodation Act 2008 (RTRA Act) and Regulation.
The changes to the law introduced will affect rent increase provisions as well as amending other provisions in the Residential Tenancies and Rooming Accommodation (RTRA) Act.
The REIQ has provided two scenarios to illustrate these changes.
Scenario A
You manage a property with a tenant on a fixed term tenancy for 6 months that commenced on 10 January 2023 and expires on 9 July 2023. Rent for this period was $540.00 per week.
Following your usual processes, you have contacted the client three months out from expiry (9 April 2023) and confirmed instructions to offer to renew the tenant’s agreement for a further 12 months. You are instructed to increase the rent for this period by $20 per week, to align with market value. The tenant agrees to this rent increase and accepts the renewal for a further 12 months. The new Form 18a is signed by both parties.
Will this rent increase become invalid?
Yes. Even though the agreement is ‘new’, the tenant is the same so the 12 month rule applies. The earliest date that a rent increase can be imposed would be 10 January 2024 because the original tenancy started on 10 January 2023 and at least 12 months must pass before a rent increase is permitted.
Scenario B
You manage a three-bedroom townhouse with three tenants renting the property in a co-tenancy arrangement. Two of the tenants first moved into the property on 18 February 2021.
The third tenant moved in and was named as a tenant on the lease during a renewal on 18 February 2023. The current tenancy agreement is for 6 months expiring on 17 August 2023. Rent is currently $420.00 per week and was increased from $390.00 per week on 18 February 2023. The tenants have a falling out and decide they do not wish to renew the tenancy.
What if 1 (or more) of the co-tenants stayed on at the property?
Rent could not be increased until 12 months from when the renewing tenant first paid the rent amount. In this case, rent would remain at $420.00 per week until 18 February 2024.
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