In this fact sheet we will cover the law on rent payments, rent increases and what happens if you fall behind in rent.
Rent is the money a tenant pays in exchange for the right to occupy a rental property. The rent amount should be set out in the lease agreement.
When a property is advertised it must include a set rent amount. It is illegal for a landlord to invite rent bidding!
The lease must also specify a payment period, in other words how often rent falls due.
Generally a payment period for rent is either one or two weeks. The longest payment period landlords in Tasmania are allowed to demand is four weeks for most rental properties and two weeks for boarding premises.
It is illegal for a landlord to charge rent per calendar month, instead of weeks. A payment period cannot be changed unless both tenants and landlord agree.
Rent in Advance
Rent is required to be paid in advance during the term of the lease.
For example: A tenant moves in on July 1st and rent is to be paid fortnightly. Rent is paid on July 1 for the period from July 1 to July 14. In other words, rent is paid for time that the property will be occupied, not the time the property has been occupied.
Rent Payment and Receipts
If a tenant pays by cash or cheque, they must receive a receipt with the date paid, tenant’s name, address of the premises, amount paid and the period that the rent is paid for. Electronic payments do not require a receipt as it usually leaves an electronic trail. A landlord cannot change the method of payment during a lease without the tenant’s consent.
Only deposit-taking institutions such as banks or credit unions may charge fees for paying rent. Other services that landlords use to collect rent must not charge fees to the tenant.
Rent Increases in Private Rentals
A landlord can increase the rent for a non-fixed term lease, or a fixed term lease that explicitly allows for rent increases to occur. When a fixed term lease agreement does not include provision for a rent increase, rent cannot be increased during the term of that lease.
The increase notice must be in writing, stating the new rent and the day on which the increase takes effect. The tenant must be given at least 60 clear days notice and there must be at least 12 months between increases.
This does not apply to social housing properties where only 60 days’ notice must be given.
There is no limit on the amount a landlord can increase the rent by. If a tenant believes an increase is unreasonable it may be challenged through the Residential Tenancy Commissioner (RTC). Tenants will have 60 days’ from notice of the rent increase to lodge a dispute. In deciding if an increase is unreasonable the RTC takes into account the general level of rents for comparable premises in the locality and any other relevant matter. The Tenants’ Union can provide advice on this.
Rent Increases in Social Housing
Tenants in social housing are charged rent based on their income – this is called their contribution. There is some variance between providers and sources of income, but generally the contribution will be 25% of income, plus 100% of rent assistance if the tenant is in community housing and receives rent assistance.
All properties also have a market rent, which is what the provider thinks they would be able rent the property for on the open market if it wasn’t social housing.
Sometimes 25% of the household’s income may exceed the market rate. In that case, the tenant will be charged the lower of the two figures. The market rent can be increased with 60 days written notice. There is no specified notice period for the contribution increasing (or decreasing), though the tenant does have to be notified.
Rent must always be paid when it falls due. This is a condition of all lease agreements.
Rent arrears occur when a tenant has not paid rent by the first day of the recurring rent in advance period.
Notice to Vacate – Eviction Notice
Should a tenant get behind in rental payments the landlord may issue a Notice to Vacate (eviction notice) for rent arrears. This notice must specify the amount of arrears owing at the time the notice is provided.
A Notice to Vacate for rent arrears must give at least fourteen (14) clear days’ notice to solve the problem. This allows the tenant to:
- Pay the arrears owing; or
- Vacate the premises.
If a tenant pays the arrears within the notice period, the NtV is fixed and the owner cannot use it to evict the tenant. If the tenant vacates the premises, any arrears may be taken from the bond.
It is important to note that during any twelve month period, if a tenant receives three Notices to Vacate specifically for rent arrears, the tenant can no longer remedy the breach. In simple terms – this is a three strike rule.
If a landlord/agent issues the third and final Notice to Vacate and the tenant does not vacate the property the landlord may apply to the Magistrates Court for an Order for Vacant Possession (eviction). This may also occur on any other Notice to Vacate for arrears if the arrears are not paid.
If you fall behind in rent…
→ Be active in finding a solution and DO NOT ignore the problem.
→ Contact the landlord/agent to discuss the issue as soon as possible.
→ If possible pay the arrears or enter into a payment plan to repay the arrears.
→ Contact the Tenants’ Union with any queries about the legality of the action taken against you.
→ Housing Connect (Phone: 1800 800 588) may be able to provide assistance in paying rent arrears and bonds (conditions apply)
DISCLAIMER: The information on this website is not legal advice. It is intended as a guide only. It applies only to legislation current in Tasmania as at 6 December 2022. For information regarding a specific tenancy problem please phone the Tenants’ Union on 1300 652 641 or (03) 6223 2641. The Tenants’ Union of Tasmania Inc. accepts no responsibility for actions based on this information, nor for actions based on electronic translations of this.