When my landlord told me he was increasing my household’s rent by $350 a week, it felt like a huge slap in the face. My three-bedroom townhouse, in the Sydney suburb of Redfern, had unresolved water damage issues and I didn’t believe the rent increase was fair or justified. So I took him to the NSW Civil and Administrative Tribunal (more on that later).
If you’re one of the many Aussies living in NSW who have been slapped with a rent increase notice, I’m going to guide you through exactly what can be done. Receiving a rental increase during a cost of living AND a rental crisis is stressful enough. Want to know how much a landlord can increase rent in NSW? Or what’s needed from a rent increase notice and how to negotiate it? I’ve got you covered.
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Rent Increase Notice: When & How Can A Landlord Increase Rent In NSW?
If you live in NSW and have received a rent increase (check),, the first thing you want to do is ensure your landlord or property manager is actually following the NSW rent increase rules. This varies based on whether you have a fixed term agreement, a periodic agreement, or no agreement at all.
Fixed Term Agreement
A fixed-term lease in NSW is when a tenancy has been agreed to for a specific period — eg six months, two years, etc — including an end date. There’s different rent increase rules for leasers more or less than two years.
Less than two years: If your fixed-term lease is less than two years, your landlord or property manager can only give you a rent increase during that time if your agreement specifies it.
The rental lease signed at the beginning of the tenancy should either include the exact rent increase amount or how the rent increase will be calculated.
Translation? It could be a dollar amount or a percentage specified within your rental agreement, but it can’t be something vague such as leaning on market rate or inflation.
Because the rent increase is specified in your lease, your property manager or landlord doesn’t need to give you written notice as they would for other leases, including longer fixed-term agreements in NSW (but more on that below).
Obviously it can be tempting to quickly sign a lease in a fucked rental market, but make sure you read it with a fine-tooth comb and know about any sneaky rent increases that might pop up!
Two years or more: If the fixed-term agreement is more than two years in NSW, you can only receive a rent increase once every 12 months, and your landlord must give you at least 60 days written notice.
You can give 21 days written notice and vacate the property before the rent increase takes effect.
Periodic Agreement
A periodic rental agreement does not have a fixed-term period. Often, the initial tenancy agreement has ended and is now rolling over on a periodic tenancy — a lot of people call these “month-to-month”.
If this describes your situation, you can only receive a rent increase once in a 12-month period and the landlord or property manager must give you at least 60 days written notice before the rent increase takes effect. Same deal when the rental tenancy is renewed.
No Rental Agreement
No written agreement? Your landlord can’t give you a rent increase for the first six months.
What Does A Rent Increase Notice Need To Include In NSW?
There’s three things a NSW rent increase notice from your property manager or landlord needs to include.
- Your rent increase notice must specify the proposed new amount of rent, rather than the amount of the rent increase
- It must specify the date from which the rent increase is payable
- It must be dated, signed and correctly addressed to you (the tenant)
If it’s missing any of these three things, it’s time to go back to your landlord / property manager.
What Is The Maximum Rent Increase Allowed In NSW?
This is where things become less regulated, tricky and, at times, downright cruel.
When it comes to the maximum rent increase allowed in NSW, as Cady Heron once famously said, the limit does not exist. It’s extremely worrying during a time when the rental market is more fucked than ever.
The harsh truth is that a landlord can increase your rent in NSW by however much they damn well like — something that certain people are taking advantage of with Australia’s vacancy rate at a record low (we’re literally at the point where granny flats are bandaid solutions, and property managers are raising the asking price after inspections).
The only state where rent caps do exist is in the ACT.
How To Challenge A Rent Increase In NSW
If you’re living in NSW and have received an excessive rent increase, the very first port of call is to check that your landlord or property manager followed the NSW rent increase rules (above), as well as any other rent increase rules outlined in your rental agreement.
If they haven’t followed these rules, then booya: you don’t need to pay the new rent increase. You will, however, need to continue paying your current rent, as well as informing your landlord / property manager that their rent increase notice is invalid. If they made a small mistake — like informing you of your rent increase amount instead of your new, increased rent — then it’s likely they’ll inevitably issue a new, correct, rent increase notice, and the process starts again. But hey, at least you might have bought a week!
Once all the NSW rent increase rules are met, you can then negotiate with your landlord or property manager, or challenge the rent increase at the NSW Civil & Administrative Tribunal (NCAT).
How To Negotiate With Your Landlord
Once you receive your rent increase, if you believe it’s unreasonable or excessive, you are within your rights to negotiate with your landlord.
It pains me to say, but you will have to consider the risks of negotiating or trying to avoid the rent increase — much like trying to jack up a salary — before diving in.
Pushing too hard or unjustifiably could result in the property manager or landlord retaliating, and you ultimately having to move on from the property — something that’s quite scary in the current rental crisis Australia is facing. It’s truly fucked that I even had to specify that, and it really does shine a light on the predicament we have when it comes to renter’s rights in NSW.
It’s also why so many renters are putting up with truly cursed rentals.
If you want to negotiate, this Rent Increase Negotiation Kit by the Tenants Union NSW is a fantastic place to start. You’ll want to consider comparable properties, your relationship with the property manager and landlord to date, your last rent increase and anything else that you feel is relevant to the rent increase negotiation.
If the landlord or property manager agrees to your rent increase negotiation, it will need to be in writing. However, a new notice is not necessary and the revised rent increase is due on the same date that the original was to come into effect.
A successful rent increase negotiation can avoid a lengthy tribunal process and a fractured relationship with your landlord or property manager — something I can personally speak to as a previous Sydney tenant in this exact situation.
If you’re negotiating with the property manager and are unsuccessful, it can be worth speaking to your landlord directly as a next step.
“We hear from a lot of renters whose landlord had no idea about the size of the increase and were happy to bring the increase down,” Leo Patterson Ross, the CEO of Tenants Union NSW, explained to PEDESTRIAN.TV.
Your landlord’s contact details should be in your OG rental lease.
How To Apply To The Rental Tribunal
If you haven’t reached the outcome you were hoping for via negotiations, you can apply to the NSW Civil Administrative Tribunal (NCAT) with an order that a rent increase is excessive. You must apply within 30 days of receiving the rent increase notice.
Personally, I received a rent increase just under 37% last year, amounting to a $350 weekly increase for a three-bedroom house in Redfern, Sydney. After being told that the rent increase was non-negotiable, my household decided to apply to the tribunal.
From there we received a date for the conciliation hearing, whereby we met with our landlord (or their representation) and try and come to a resolution. The hearing was a few weeks after we applied.
If a solution is not reached (or for some reason the conciliation does not go ahead, which is what happened in my case), a new date will be set for an official hearing. This can take some time — mine wound up being another two months later, during which time we had to start paying our increase.
There are very specific and requirements you have to adhere to if you reach this stage, including compiling evidence and printing three versions of everything (one for you, the landlord and the tribunal member).
It can be time-consuming and laborious depending on your case — not to mention mentally overwhelming when it comes to legal rights, jargon, sections and orders for an everyday person like many tenants.
Jahan Kalantar, a lawyer and partner at Executive Law Group, believes “NCAT does a very good job of dealing with a very challenging issue” but that the process is “difficult”.
“All parties don’t have the same understanding and access to justice. It can be extremely difficult to understand what hurdles and hoops a person needs to jump through and over,” Kalantar told PEDESTRIAN.TV.
After my tribunal hearing, the tribunal ordered that my landlord reduce our rent increase by $50, from the date the rent increase took effect (meaning we were back paid for the excessive rent paid while waiting for the tribunal hearing and decision).
We also received a $3,900 rental refund for a prior 12-month period where it was found that our rent was excessive considering a loss of amenity (this was under a separate repair-related order).
We put in our notice to vacate shortly after the tribunal’s outcome, meaning we will never know if a retaliatory eviction was on its way as a result of going to the tribunal. Sadly, this is something that has happened to tenants in similar situations, and another unfortunate risk you need to consider when challenging a NSW rent increase.
“Unfortunately, in the current system we are also thousands of people feel that it’s not safe to challenge,” Patterson-Ross explained.
“The ability to be arbitrarily evicted with ‘no grounds’ puts a real barrier on your ability to get proper scrutiny of the increase.
“NSW government promised they would end these unfair evictions and replace them with a set of reasonable grounds. This has strong support across the community and needs to happen as soon as possible!
“Nearly 30,000 rental homes receive these arbitrary notices each year.”
If things go south and you feel like you were absolutely fucked over, be sure to pop your property on Shit Rentals. It’s the little power we have in an absolutely unfair tenant-landlord dynamic — and it could save someone from the pain you’ve just gone through.
What’s The Average Rent Increase In NSW?
According to the Domain Rental Report from March 2024, pictured below, Sydney renters have seen a 13.6% annual change in median rent. This is compared to 0.7% in Canberra, the only Australian city with rental caps.
Unsurprisingly, the majority of the most expensive suburbs to rent in Australia are in Sydney.
“Compared to 1990 we’re paying more than $10,000 a year more in real terms for rent in Sydney — which is a whole lot of money that could be doing a lot more good being spent on food, healthcare than on paying off the enormous debts,” Patterson-Ross shared.
According to SQM Research for the year up until April 12, 2024, the national median rent is up 8.8% for houses and 10.2% for units. The three-year national increase was around the same at 10.6% and 11.1% for houses and units respectively.
If you want to find the average median rent increase in the specific area you’re living or want to live, you can choose your postcode on the SQM Research website. While it’s helpful to know how much rents have increased in your area, it’s also helpful to know the median rent locally to further understand your landlord or property manager’s logic (should that exist).
“Just like we do with energy, we need to make sure that pricing of such an important essential [such] as the roof over your head isn’t unfairly priced,” says Patterson-Ross.
“At the moment, the focus on comparable market rents in challenging rent increases means that if one person raises the rent significantly, everyone else can too.”
While it’s pretty grim out there, I have heard of (and personally know of) landlords who are understanding, reasonable and fair with their rent increases or their negotiations. They’re not everywhere but they do exist.
If that’s not the case in your situation then it might be time to get acquainted with your rights and risks.
More: Here’s how much rents surged in each Australian capital city in 2023.
Lead photo: Getty / Chantelle Schmidt / Instagram.
The post What To Do About A Rent Increase In NSW: A Step-By-Step Guide appeared first on PEDESTRIAN.TV .
