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7 things you need to know about those pesky rental cost increases.

Yesterday, my rent went up.

Having lived in houses that were not part of the traditional renting system – let’s call it extended housesitting – for the past four or so years, this came as a rude shock. Rent… Going up? Wait, can they do that?

My flatmate seemed pretty unfazed by the situation. “It hasn’t gone up in a while,” she said. “It’s pretty normal.”

But still, it niggled at me. Is it normal?

Well we’ve done some digging to answer all of your tough questions about renting and rental increases, so you can feel empowered next time you’re told it’s going up.

Would you be able to afford it if your rent goes up? Via IStock.

1. So, can you refuse a rental increase?

Yes and no. Refusing a rental increase could mean eviction. These terms will be listed in your rental agreement signed before you move in, so make sure you are diligent to check.

According to the Tenant's Union of Victoria:

"The rent cannot be increased during a fixed-term tenancy agreement unless this is specified in writing in the agreement. Unfortunately the standard real estate agent tenancy agreement usually includes this term so it is important to read the agreement carefully before you sign it."

If you want to omit it from your agreement, make sure you specify that before signing - but be warned, most real estate agents will insist that it's included.

2. How much should it go up?

Generally speaking, your rent will increase somewhere around $10 - $50/ week.

However, it is worth trying to negotiate with your landlord or agent over a proposed rent increase, as they may be willing to reduce it, especially if you are an established and reliable tenant or you would have to move out because of the increase.

"If you have an inspector’s report you can also use this to try and negotiate with your landlord or agent so you don’t have to take the next step of going to the Tribunal," says the Tenant's Union. "Make sure that any agreement you reach is put in writing and signed by yourself and the landlord or agent."

Trying to figure out how and why rental increases work can be confusing.

3. How often SHOULD it go up?

This all depends on your location and your landlord. If you are in a rapidly growing area, your landlord might opt for annual rental increases. On the other hand, you can sit on the same rental payment for years before it changes.

Kimberley Mackenzie is a solicitor and at the Inner Sydney Tenants’ Advice and Advocacy Service, and says that there is no one rule for rental increases.

"Rent increases are purely at the landlord’s discretion," she says. "If the landlord wants to increase the rent they can, so long as it is done in accordance with the law."

4. How often CAN it go up?

Ok, this can go one of two ways.

Fixed agreement -

If a tenant has a fixed term agreement of less than two years, the rent cannot be increased within the fixed term unless the agreement specifies the amount of the increase or the method of calculating any increase.

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Periodic agreement -

When the fixed term ends, if a new fixed term agreement isn’t made, the agreement becomes a “periodic” agreement.  If a tenant has a periodic agreement, the landlord can then increase the rent by giving 60 days written notice. (If the notice is posted to the tenant, four business days must be allowed for postage before the notice period commences).

However...

"If the rent is increased in accordance with the law and the correct notice periods are observed, there are effectively no restrictions on how often a landlord can increase the rent," warns Kimberley.

5. What factors should decide the increase?

Anything from the costs of surrounding properties, to how new your facilities are can influence the increase, says Kimberley.

"A rent increase should be in line with the market rents being achieved for similar properties in the local area, having regard to the condition of the property and the appliances or facilities that it includes."

She recommends that if you think the rent is excessive, they should look at what the asking price is for similar properties in the local area.

6. What happens if I refuse to pay the rental increase?

Ok, so here's how it works: if you refuse to pay the increase and continue with your standard amount, you're considered to be in arrears for the increased amount.

Once you're 14 days in arrears - that is, owing money to your landlord - then they officially have the right to give you a 14-day Notice To Vacate, and apply to Tribunal to have you evicted.

Moral of the story? Don't do that. Talk to your landlord and find a solution.

One thing you want to avoid is needing to vacate due to the rental increase.

7. Who can you call for advice?

Obviously, the first person to speak with is your local real estate agent who brokered the deal between yourself and your landlord. It's in their best interests to keep you in the property - not trying to find a new tenant.

If you still don't get the answers you need, try the following:

Queensland: Residential Tenant's Authority.

New South Wales: Tenants NSW.

Victoria: Tenant's Union of Victoria.

South Australia: South Australia Tenant Help.

Western Australia: Tenancy WA.

Northern Territory: Northern Territory Tenant Help.

Tasmania: The Tenant's Union Tasmania.

Always keep open lines of communication with your landlord and your rental agent, and they should do the same for you. And remember - if this property doesn't work out? There's plenty more fish in the sea.

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