Yahoo Finance $620 detail exposes controversial new Aussie landlord pricing tactic: 'Disgusting'
A real estate worker has explained why renters will see this a lot more in one Aussie state.
A Queensland rental property has caught the attention of Aussies online and some aren't happy with what they're seeing. The three-bedroom townhouse on the Gold Coast has a decent backyard, access to a pool, a walk-in wardrobe and space for one car.
But Aussies were confused when they saw the property was listed at $580 per week until mid-January and then it would go up to $620 per week. The property is being managed by Harcourts Arundel and a spokesperson for the real estate company told Yahoo Finance there's a very good reason for the split cost.
"So at the beginning of June [this year], the laws changed, and now there can only be a rent increase once every 12 months on a property, not on a tenancy," she said.
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The spokesperson explained that the current tenant only signed a six-month lease and while landlords would usually be able to jack up the rent once the resident is out, Queensland homeowners have to wait until the full 12 months is up.
She said the new system at least gives tenants full transparency about how much they will have to pay and won't get any surprises.
But the transparency didn't sit well with some Aussies.
"At least they’re upfront about f**king you with the ~6.8% increase," wrote one.
"Disgusting! Classic baiting," said another.
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Why pricing tactic benefits tenants: 'They've got no idea'
But the Harcourts spokesperson revealed to Yahoo Finance that these new laws "favour tenants more than homeowners".
"Looking at all those comments...they've got no idea. It's very, very difficult for owners in this position," she said.
"It essentially means that if an owner decides they want to spend, say, $20,000 to $30,000 on doing the property up, they can't re-let it at a higher rent if there was a previous increase less than 12 months ago."
She said landlords are now not incentivised to improve their homes until it gets closer to that 12-month mark when the rent could increase.
The Harcourts spokesperson said for this specific example, the Gold Coast property was actually "under market value" and the increase to $620 per week was "still actually quite cheap".
She added that it was "amusing" to see so many negative responses online when Harcourts was simply trying to follow the new rules.
But the real estate worker said this was emblematic of a wider problem that affects her industry.
"From our point of view, we're stuck in the middle with this, and we've received a lot of abuse from people, and I'm not only talking about people wanting to apply or rent a property but also other potential owners out there," she said.
"It's not our choice to put the rent up, and I don't get paid anymore. If it goes up $50 a week, I still get paid the same wage. There's nothing personal involved whatsoever. I'd wish people just to see that."
What are the new Queensland rental laws?
Laws were updated on June 6 this year, here's a rundown of some that will appeal to renters:
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 even if a prospective tenant makes an offer to pay more than the amount prescribed in the legislation.
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 a minimum period to increase rent.
Evidence of last increase – a tenant is allowed to request evidence of the day of the last rent increase, which must be provided within 14 days.
Undue hardship – a managing party may apply to the Queensland Civil and Administrative Tribunal (QCAT) for permission to increase the rent within that 12-month window if they're experiencing "undue hardship".
Fixed price – rooming accommodation must be advertised at a fixed price.
Rental bonds, which previously could have been as high as the landlord wanted if the rent was over $700 per week, will soon be restricted to no more than four weeks rent.
Real Estate Institute of Queensland CEO Antonia Mercorella told Yahoo Finance that law in particular needed a refresh.
"The $700 threshold was set many years ago at a time when weekly rent values were vastly different to those we are seeing in today’s market," she said.
"The recent rental legislative changes create consistency for bonds - a maximum bond of four weeks rent will apply for all general tenancies, irrespective of the weekly rent amount."
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