Yahoo Finance Aussie renter's $6,500 win after estate agent's $1,100 demand: 'Held to ransom'
Sally Coleman wasn't going to back down when she was hit with the huge bill at the end of her tenancy.
A renter who won a David vs Goliath battle over an absurd $1100 cleaning fee has condemned the use of "standover" tactics allowed to be used by real estate agents and landlords to squeeze tenants. Sally Coleman and her four housemates toiled to leave their Sydney rental in great condition.
The musician told Yahoo Finance she applied for the $6,500 bond back, but it ended up being "frozen" and "held to ransom" in a near month-long dispute after the real estate agent ordered a $1,110 end-of-lease clean.
"We looked through the exit report, which was like, I think, over 800 photos, and because it was so long, it was really difficult to tell what the actual issues were," she said.
"Some of them you couldn't even see what the problem was in the photo."
The group were told dust in cupboards, a hair in a sink and a spec of dirt on the tiles were among the reasons the extensive clean was needed.
But they disagreed and refused to pay.
RELATED
New tactic real estate agents are using to sell and rent properties
$160 cost-of-living cash boost hits Aussie bank accounts this week
Hundreds of Aussie jobs in limbo as iconic burger chain goes into voluntary administration
"The gist that we got from this experience was that someone wanted a professional showroom clean, and then they decided that the tenants should have to pay for that, whereas that's not legally what's required of tenants," she said.
"We're required to leave it reasonably clean, and it's not really up to us to pay for showroom-level housing."
As they'd made the application for their bond, the real estate agent had two weeks to either release the money, which would require the landlord to cover the cleaning fee, or take the tenants to the NSW Civil and Administrative Tribunal (NCAT).
This meant her bond would not be released until the dispute was over. Being without that money can be a reason people don't challenge bond claims.
Like many Australian tenants, Coleman said she had very little legal knowledge and had to take weeks researching NSW tenancy laws and her rights.
She doesn't work a typical 9-5 so had the time, and could be flexible to attend the NCAT hearing.
"Some tenants realise that they're being screwed over they realise they probably could contest it, but don't because of the mental gymnastics, the emotional labour and taking a day off work ... the actual hassle of contesting it," she told Yahoo Finance.
How they got the bill down from $1,100 to just $250
The first step of the dispute is a mediation hearing, where you are given time to talk to the real estate agent in the hopes that you come to a compromise.
Prior, her housemates agreed they were willing to pay $50 each, $250 total, for the cleaning.
But the agent said the landlord wouldn't budge from the $1,100.
“It really quickly became clear that this wasn’t about actually negotiating the cleaning, this was more like how much money can they get out of this meeting,” she said.
NSW Fair Trading states a claim can be made on the bond when the tenant "has not cleaned the property to the same standard as the start of the tenancy".
The musician came armed with more than 40 pages of documentation related to how they left the property at the end of the tenancy.
But she also asked the agent for an itemised receipt to prove why the cleaner needed to do a $1,100 job.
The renter pointed out that if an itemised invoice had been produced “retrospectively”, it would have breached Section 165 of the NSW Tenancy Act.
While the agent didn't seem fazed by the threat of a $2,000 fine for breaking Section 165, they did eventually settle for the $250 offer.
“There is nothing about the NCAT process that is scarier to a real estate agent than the prospect of losing a high-value client who has a big portfolio,” she said.
“When it comes to pissing off the tenants, breaking the law, going to tribunal, they will take all of those things if it means keeping the client happy.”
'Threat' of tribunal proves rental system broken
Throughout the process, Coleman reached out to her social media following for tips on how to tackle the dispute and was flooded with responses. From Australian tenants who had been through similar issues, to landlords and professionals in the real estate industry.
She would encourage people to fight back if they have the time and money.
But said her experience highlighted that there needs to be legislative change to make the tribunal process fairer.
"My issue is with policymakers and people who set these preconditions where [real estate] agents can use NCAT as like a standover tool, rather than what it's supposed to be, which is a fair mediation process. Instead, it's like a threat," she said.
"Even if the tenants are going to win, it's just their time, it's their energy. There's no compensation for that. Your bond is frozen. So even though it's not supposed to, it's something that's penalising the tenant."
Her advice? Put everything in writing and be proactive as you near the end of your lease.
"If you're worried that your agent might have different standards of cleaning to yours, you can get on the front foot by sending an email being like, 'This is all the cleaning we've done. We think it's reasonable because of this. If you think it's unreasonable, you need to tell us'," she said.
NCAT have reported a steady increase in the number of hearings for tenant disputes.
In the 2022-23 year, there were 93,324 NCAT hearings held across NSW, up from 91,495 hearings the previous year.
In 2019, that number was 79,645.
The Tenants Union of NSW provides documents about how to approach a tribunal hearing and said the cleanliness of a home at the end of a lease can be a big issue.
"Landlords often get very heated when a property isn't left in a pristine condition, but that's simply not the test," CEO Leo Patterson Ross explained to Yahoo Finance.
"You can choose to use a professional cleaner for convenience, but it's certainly not a requirement - though that doesn’t necessarily stop landlords or their agents from asking. In general, a professional clean is far beyond 'reasonably clean'. But if you've been running around on carpets with muddy boots, it might be worth hiring a professional to meet the required standard.
"You might also find your lease has a clause requiring or requesting the carpets to be professionally cleaned at the end of your tenancy. In some states and territories, these clauses will be enforceable, but in others — like NSW (providing you don't have pets) — they are not."
Coleman said that without the union's help, her battle would have been almost impossible.
"There's a lot of great services out there, like the tenant's union was amazing," she said.
Get the latest Yahoo Finance news - follow us on Facebook, LinkedIn and Instagram.
