How to Deal with Rent Increases In VIC

Step 1 – Know Your Rights

The Residential Tenancy Act 1997 outlines the rights you have as a tenant when renting in VIC.

In Fixed Term Agreements shorter than 5 years the rent cannot be increased unless it is stated within the tenancy agreement and;
- the agreement states the new amount (or how it will be worked out)
- the landlords/rental provider gives the tenant at least 60 days’ notice in writing
- For agreements before 19 June 2019
  - it has been at least 6 months since the tenancy started or since the last increase
- For agreements after 19 June 2019
  - it has been at least 12 months since the tenancy started or since the last increase
In Fixed Term Agreements longer than 5 years the rent cannot be increased unless it is stated within the tenancy agreement and;
- the agreement states the new amount (or how it will be worked out)
- it has been at least 12 months since the tenancy started or since the last increase
- the landlords/rental provider gives the tenant at least 60 days’ notice in writing

In Periodic Term Agreements the rent can be increased if,
- the landlord/rental provider gives the tenant at least 60 days’ notice in writing, and
- it has been at least 12 months since the tenancy started or since the last increase

For all the above the landlord/rental provider must use the correct forms to give the renter notice, these forms are either.
- Notice of proposed rent increase to renter of rented premises
- Notice of proposed rent increase to resident of rooming house
- Notice of proposed rent/hiring charge increase to residents of caravan park
- Notice of site rent increase – fixed amount under site agreement
- Notice of proposed site rent increase – non-fixed amount

TIP: If the incorrect forms are used, then the notice is not valid, and the renter does not have to pay until the correct notice is re-issued and the 60-days start from that point.

Excessive Rent Increases, if you think the suggested rental increase is excessive, your options include;
- Negotiation with the rental provider/landlord TIP: see the below steps to find out if your rental increase is fair by Rent Rabbit 😊
- Renters can ask Consumer Affairs Victoria to investigate and report on rent increases if they think the increase is too high. This process is called a rent assessment or a rent increase investigation.
  - IMPORTANT: You must apply within 30-days of getting a rent increase notice and before the agreement ends if it is a fixed-term agreement.
  - Use the request for rent assessment form or you can use the ‘notice to increase rent’ which should contain a section to complete and send to;
    - The Director of Consumer Affairs Victoria, GPO Box 123, Melbourne VIC 3001, or;
    - Email it to renting@justice.vic.gov.au.

Step 2 – Steps to finding out if your rental increase is fair

Log in to your www.rentrabbit.com.au account
Select “Dashboard” from your drop-down menu
Select the “Suburb Trends” option from your taskbar
Type in your Suburb name (in this example we have used Ridgehaven)
Ascertain your suburbs % increase

Step 3 – Calculate your suburb’s median % rent increase

Using Ridgehaven we will calculate its median % rent increase
- In this example, in the last 12 months, the median house rent when from $380 to $410.
  - $410 divided by $380 = 1.0789
  - (1.0789 minus 1) times by 100 = 7.89%
  - Therefore, the median house rent in Ridgehaven went up 7.89%
Now let’s calculate your properties value (if you were based in Ridgehaven, remember to always use your suburb in part 1).
- Your landlord is requesting an increase in rent from $400 p/w to $460 p/w.
- $460 / $400 = 15% increase (therefore your landlord’s increase is over 7% more than the current market data suggests)
- What the suburb data is showing is that for a $400 p/w property the increase should be:
  - $400 * 0.079 = $31.60 increase
  - $400 + $31.60 = $431.60
- We can see from this example the increase should be roughly from $400 p/w to $430 p/w

Step 4 – How to reply to your landlord/rental provider to propose a revised increase

Here is a draft response

“Hi {insert name of landlord or agent},

I’ve recently received notification of a proposed increase in rent from {$X} to {$X} per week. The suggested price increase is too high, the market in our area over the last 12 months suggests the median rate has in fact {dropped or risen slightly} to {X %}.

It would be great if we could discuss terms and find something we are both happy with. I enjoy living here and I am a good tenant, having kept the property in excellent condition.

To help with the landlord’s decision, below is recent market activity demonstrating a {house/unit} median increase in {Insert your suburb name} of {X%} from 12 months ago. We’d like to negotiate a 12-month fixed lease for {$X} considering the market rents for comparable properties.

{Insert median house/unit data from your suburb search}

In addition, it’s likely if we were to relocate that the owner would perhaps be up for a re-letting fee ($800-$1500), potential loss of rent if it was the vacant and unknown quality of tenants.

Thank you,“

Step 5 – TIP OF THE DAY: Save your email history in your Rent Rabbit profile