Recent Changes To Rental Law – What Investment Property Owners Need to Know

This week the Residential Tenancies Authority (RTA) released confirmation of some ongoing changes to rental law that came into effect from 6^th June. If you are the owner of a rental property, it’s important to understand what the changes are and how they might affect you, especially around rental increases and accepting rent in advance.

Rental increases are now limited to once every 12 months, and are linked to the property and not the tenancy. The tenancy agreement must now state the date of the last rent increase, and a tenant may (by written notice) request evidence of the day of the last rent increase, which must be provided within 14 days.

Maximum rent in advance is now capped at two weeks for a periodic tenancy, and one month for a fixed agreement. Property Managers and owners are not allowed to invite or accept more than this in advance at the start of a tenancy.

As your Property Managers we have already factored these changes into our processes and are ready to answer any questions you may have. Please get in touch with us if you would like further clarification or information.

We have also added the details from the RTA below for you to read.

New Laws In Effect From 6 June 2024

• Rent bidding – rent bidding or accepting rent offers higher than the advertised price is banned.
• Maximum rent in advance – a property manager/owner cannot, at the start of a new tenancy, solicit, accept or invite a tenant to pay more rent in advance that exceeds two weeks for a periodic tenancy agreement, a rooming accommodation agreement or movable dwelling tenancy agreement and one month for a fixed tenancy agreement, even if a prospective tenant makes an offer to pay more than the amount prescribed in the legislation. Note: throughout the course of a tenancy, a tenant may negotiate how much rent in advance can be paid
• Rent increases – are limited to 12 months and are attached to the property instead of the tenancy. Written agreements must state the date of the last rent increase.
• Exemptions for rent increases – exempt property managers/owners and exempt providers/agents will be exempt from minimum period to increase rent. The Act provides definitions for an exempt property manager/owner and an exempt provider.
• Evidence of last increase – a tenant may (by written notice) request from a managing party, evidence of the day of the last rent increase, which must be provided within 14 days. The requirement to provide evidence of a rent increase does not apply if the premises is purchased within 12 months of commencement, and the property manager/owner does not have information about the date of the last rent increase.
• Undue hardship – a managing party may apply to Queensland Civil and Administrative Tribunal (QCAT) for permission to increase rent within 12 months due to undue hardship. The tribunal must have regard to any representation made by the tenant in relation to affordability and ability to continue to pay rent.
• Fixed price – rooming accommodation must be advertised at a fixed price.

So what are the key compliance changes to be aware of?

• A property manager/owner must not solicit, invite, or accept an offer of rent higher than the advertised prices. Penalties apply.
• At the start of the tenancy, the property manager/owner cannot solicit, invite an offer, or accept an offer of rent in advance for more than one month for a general tenancy agreement, two weeks for rooming accommodation, and two weeks for moveable dwellings. Penalties apply.
• The tenancy agreement must state the date of the last rent increase. However, an exempt property manager/owner/provider is not required to provide this information. The requirement to provide the date of the rent increase in the tenancy agreement is not applicable for property managers/owners if the rental property is purchased within 12months of the tenancy commencing, and the property manager/owner does not hold information about the day of the last rent increase for the premises.
• During the tenancy, a tenant may request the property manager/owner/provider to provide evidence about the last day of the rent increase, and they must supply the tenant with evidence within 14 days after receiving a written request. Penalties apply.

What are the new rent in advance laws?

• A property manager/owner must not solicit, invite an offer, or accept an offer from a prospective tenant for more than one month for a fixed-term tenancy agreement, two weeks for a periodic tenancy, moveable dwelling agreement, and rooming accommodation agreement. Penalties apply.
• Requesting rent during a period in which rent has already been paid is an offence.
• Throughout the course of a tenancy, a tenant/resident may negotiate how much rent in advance can be paid.

What are the new rent increase frequency laws?

• Rent can only be increased if it has been at least 12 months since the current rent amount became payable for the residential premises. The 12-month minimum period continues to apply if there is a change to the rental property manager/owner or tenant. Penalties apply.

Can a customer request the RTA provide them with the date of the last rent increase for their rental property?

• If a customer would like to obtain evidence of the date of the last rent increase for their rental property, they should contact their property manager/owner and request the information in writing.
• A customer would need to make a formal application as set out in the Right to Information Act2009 (RTI Act) and Information Privacy Act 2009 (Privacy Act) to request this information from the RTA.

If the property was purchased within 12 months of a new lease starting and the property manager/owner does not have the information about the last rent increase, or if the property owner lived in the property before renting it out, how can they provide the date of the last rent increase on the tenancy agreement?

• From 6 June 2024, the legislation requires property managers/owners to provide the date of the last rent increase in a general tenancy and rooming accommodation agreement. There is no specific exemption for situations such as when a property is purchased within 12 months of a new tenancy starting, and property managers/owners do not have the information of the date of the last rent increase. Additionally, the legislation does not address the situation where an owner who previously lived in the property begins renting it out for the first time and is unable to provide the date of the last rent increase.
• The Residential Tenancies Authority (RTA) recommends that property managers/owners communicate to the tenant in writing if they cannot provide the date of the most recent rent increase at the beginning of a tenancy including the reason why that information cannot be provided.
• Tenants can ask for evidence of the last rent increase if they have concerns about compliance with the legislation, however, if the property was purchased within 12 months of the start of the tenancy, the property manager/owner is not required to provide evidence if they do not have it.
• Under the legislation an owner is deemed to have evidence of the last rent increase if they, or their agent (e.g. real estate agent, property manager, lawyer) has this information in their possession or control.

For full details please go to the RTA website here: Rental law changes | Residential Tenancies Authority (rta.qld.gov.au)