Finding a Rental Property. Is It Common to to Pay Extra Rent / Extra Bond?

My partner and I are looking to find a rental property in a new area. We both have good rental history and stable employment however we understand that the market is very flooded and competitive.

I’m curious to know if any of these options are considered ‘normal’ and would give us a better chance at getting picked for the rental? Or just appear to be a tosser.

A. Pay extra bond, like double?
B. Offer to pay 6/12 months upfront?
C. Offer to pay extra per week $10, $20 etc

Just curious to hear what you say. Otherwise, any tips.

Cheers

Comments

  • +12

    No
    No
    Yes

    • Thanks for the feedback

  • +5

    (C) would be my choice, despite my dislike for rent auctions.

    • Thanks for the feedback, the properties are listed at a fixed price but we’d be happy to offer more.

  • D. Wait… Have you got a Pet?

    • Yes, we have one dog.

      • +4

        Good Luck. Woof!

      • D. Rehome the dog. If it is a choice between two similar applicants and one has a dog it is no contest.

        • +1

          Depends on the landlord. I was happy to accept a tenant with a dog, who had good reference from previous rental, over an unknown with no dog.

          • +1

            @miwahni: Yeah it does, but if you aren't clearly better then you are going to lose out by having the dog.

            That being said I deliberately rented my house to a family with two cats as I had found it very difficult to find a house to rent with my two in the past, and I had put a lot of work into making my house super cat friendly (netted enclosed back yard, all cat safe plants in garden, cat door)

            • +1

              @Quantumcat: Yeah don't always assume

              Our tenants have 2 dogs and now they even have chickens.

              Honestly as a landlord I would go for something like offering a 24 month lease over $10 or $20 a week increase in rent.

  • Pay 3 months upfront

  • +3

    a) I don't think you can legally pay more bond. It's essentially got nothing to do with the landlord anyway as it goes in a government holding.
    They can't legally charge you more than 4 weeks (unless a week's rent is over the threshold which is something like $1250/week) so I don't think you can legally pay more if you wanted to.

    b) Paying 6-12months up front would also likely be more of an issue for the property manager than paying weekly/fortnightly/monthly so not worth it.

    c) Yes, if you're struggling to find a place, negotiating with the property manager can go in your favor. I don't know where you're looking but renting in Perth has gone stupid lately, with increases of $50-100/week not uncommon on lease renewals at the moment, so offering above what they're asking can definitely help your situation, especially if you're battling against someone without a pet for example.

  • +2

    C

  • B) People are doing that to jump the queue . 1 yr obviously the best .

    • +1

      B and C will definitely both help. I'm a landlord and last time my place needed to be re-rented I had one tenant offer 6 months rent in advance and another offer 12. Showed me they weren't going to struggle to pay rent longer term as they are clearly capable of saving. So I gave it to the folk that offered 12 months in advance and discounted the other applicants.

      I see a few folk commenting that the agents don't like it, not sure about that, mine didn't seem to care.

      • +1

        My lease recently renewed and rent increased about $40/week. We got the dates mixed up and paid the increase in bond and fortnightly rent a month ahead of time….Our property manager lost their mind when we said just to keep it and we'll fix it up next fortnight. They couldn't refund it and couldn't put it as credit on our rent for some reason. Ended up having to put it down as credit on our water usage. No way in the world would they take 6-12 months of pre-paid rent and this property management/real estate has been around for over 40 years.

        • +1

          Ours just took the year in advance and hold it, then distribute it monthly as they normally do to us, in case the tenant does happen to leave early for any reason. Hasn't been any issues.

          It's hardly rocket science, sounds like an incompetent agent/and or terrible systems.

      • I've had lots of luck offering 6 months in advance, and enquiring about a 12 month lease when actually only 6 was offered. Nobody actually wanted the 6 month paid in advance, but I think it helped to demonstrate I was able to pay the rent and was interested in staying i.e. responsible person and thus probably a good tenant.

        I'd do B.

        Don't do C, you'll be stuck paying more forever.

    1. Why on earth would you want to have thousands of dollars locked up just to secure a property? you can't do this anyway, it's not legal.
    2. A common mis-conception from people is that they think they can offer to pay "in advance" but this actually becomes an issue for the real estate agent. They need to hold onto the money and deposit it every cycle. then if you leave early, they need to give it back. they don't like this so don't even try it.
    3. bingo. offering to pay more will get you the property but only to a degree. remember that $10 a week is only $520 a year. a more desirable tenant with better rental history or something else is worth more than $520.
    • +2

      Why on earth would the agent hold the money and deposit it each payment period?
      Its a pre-payment of rent. That money should go straight to the landlord (minus any agent fees).

      • +1

        If the tenant needs to break in the lease earlier than what paid upfront, they need to return the money (minus some penalties). They don't want to be trapped in the middle with the landlord unwilling to return the money.

        • I don't see how this could be right.
          The agent is the agent of the landlord - not the tenant. They can't just be holding money on the tenant's behalf on the off chance that the tenant breaks the lease and wants money back.
          If the tenant does break the lease early then they MAY have a claim against the landlord if:
          1. the rent paid is not forfeited by way of either a non-refundable prepayment or liquidated damages, or
          2. the landlord is able to mitigate by getting someone else in,
          however, that is no reason to have the agent holding the money on trust for the tenant indefinitely. An agent would be stupid to do so.

          • @Almost Banned: No, the agent isn't holding the money off the tenant's behalf. The agent is protecting itself and the landlord against liabilities. If the tenant put a claim against the landlord and the landlord is unable to pay because the landlord have blown it all, they have liability problems.

            "1. the rent paid is not forfeited by way of either a non-refundable prepayment or liquidated damages," <- no, below is what landlord legally can have at max (in NSW anyway), so if the tenants have prepaid for 12 months, the landlord has to return the money:

            If you have been in the tenancy for less than 25% of the fixed term: 4 weeks rent
            If you have been in the tenancy for more than 25% but less than 50% of the fixed term: 3 weeks rent
            If you have been in the tenancy for more than 50% but less than 75% of the fixed term: 2 weeks rent
            If you have been in the tenancy for more than 75%: 1 week’s rent

            There's no legal mechanism for "non refundable payment".

            And if for some reason the place become uninhabitable, tenant can break the lease without penalty.

            Having said that, the agents that I know prefer to receive the payment upfront because it is better for them to have to put the extra money in the trust account, rather than having the risk of the tenant unable to pay down the track. Same reason, less liability.

            • @ajca256: Interesting.
              Source?

              • @Almost Banned: Sorry, not clear to me source of … ?

                If you are referring to the what landlord can have legally at max - that is standard tenancy agreement that you can find in NSW Fair Trading's website. Just google for "residential tenancy agreement nsw 2020".

                If you are referring to the thought process of a real estate agent (the liability thing), one of my good mates works for a Ray White agency. At least in their agency, they do not release money from the trust account before its due for that reason.

                • @ajca256: I'll clarify.
                  You said:

                  below is what landlord legally can have at max

                  So, what is the source of that claim, ie state the law that provides this is the max.

                  • +1

                    @Almost Banned: Ok fair, I was wrong to say that. The assumption I made there was that everyone follow a standard agreement provided by the Fair Trading, but I guess a person can decide not to do so; and sign a different agreement. But if you follow the standard agreement, that is the max (please check the agreement for yourselves, but I pasted the clause earlier).

                    Any tenant that would sign a non standard agreement is stupid - landlord can just decide stop maintenance of the property even if the property becomes uninhabitable as a result (e.g. refuse to fix hot water). After all, the tenant have paid the full year in non refundable way. Dangerous territory here ..

                    And I assume you also meant that such an agent that don't force their tenant to sign a non standard agreement to include no refund clause is stupid

      • Its a pre-payment of rent. That money should go straight to the landlord (minus any agent fees).

        And that exactly what happens.

    • A common mis-conception from people is that they think they can offer to pay "in advance" but this actually becomes an issue for the real estate agent. They need to hold onto the money and deposit it every cycle. then if you leave early, they need to give it back. they don't like this so don't even try it.

      Very very wrong!
      Agents do not pay it every cycle if you pay upfront. They take their cut transfer the rest.
      A lot of agents actually suggest to tenants paying months in advance to put them ahead of the rest.

  • +1

    Here's a tip:

    Don't wait for inspections, put your application in, then show up for inspection, or if your not comfortable with that, have the forms pre-filled in and hand them over then and there.

    • +1

      In Victoria, Agents cant take applications from anyone who has not viewed the property.

  • Just a thought, Some landlords may not want the rent up front for tax reasons, may want to defer income instead of lump sum.

    Just pay extra $$

  • +1

    No point with extra bond unless you are bad on paper (ie poor history).

    Best to just look real stable and boring. Low impact on the property (ie minimal wear and tear, no complaints etc)

  • +1

    As a landlord

    B would put you at top of my list :)
    C would of course spark my interest but not going to choose you over another if someone else was a more attractive tenant (Job, rental history etc)

    Having rent paid and secured for a longer period is a far better prospect than a $10 extra a week long term. (also a lot of rental properties have rental prices set where landlord needs them to negative gear or the like so offering extra sometimes can backfire)

    You could pay $10 more a week, and then still breach your lease, at least if you pay upfront i would be able to stress less as a landlord.

    Honestly B is the best way to go.

  • +2

    I don't think it is common but we did b and c when we first got into the renting marketing with no prior history. Offered to pay up front 6 months and $10 more a month.

    • Exactly what I did

  • A and C are illegal in Victoria under the new rental law changes. (https://www.consumer.vic.gov.au/housing/renting/changes-to-r...)

    From experience, we secured rental properties just from applying fast. Apply for a property the same day you view it. If you've got good income and rental history, then they'll be more likely to consider your application first.

    • +1

      C is not illegal if TENANT offers more
      Its illegal for an agent to suggest they pay more, its illegal to have rental auctions.

      if a tenant wants to offer extra off their own back… very legal

  • +2

    As a landlord B every single day. That will shoot you to the top of the list. Provides certainty to me, demonstrates you've got your financial sh1t together and reduces my risk.

  • Can't believe people are recommending B, 3 months is plenty, and you're not locked in as much financially if you decide to move to another area for whatever reason.

    • Well you would be locked in for 12 months regardless

      • Can still break lease and in the current climate, wouldn't take long to fill the property I'm sure

  • I did b and C on my current rental. C is the landlord favourite, if you have good history guaranteed, my sister had done so a few times in different states. B works if the landlord just did extensive repairs from the last tenant.

  • +2

    Renting a property can involve negotiation by both parties. Jesse Pinkman's guide

    • Not even going to watch that but giving you a thumbs up

  • Offer more and commit to a long lease.

    As a landlord we ONLY accept applications from people with pets. We've seen first hand how difficult it is to find pet friendly properties. We don't want more pets abandoned at shelters because of moron agents and landlords who don't allow them in their properties.

    ALL our properties get rented to people with pets. Make a pet resume. Try to attach a photo of your pet, details about their vaccinations, training certificate, deworming, desexing and reference from previous property manager.

    Cheers!

    • -1

      Obviously more $$$$ will be paid by this group as unwanted by most landlords especially now with the huge demand .

    • +1

      In Victoria now hard to refuse rental to a person with a pet. But in the past, I also advertised my property as pet friendly and wanted pets as felt the tenant would stay longer. However, my property is in poor condition so less chance of damage.

  • -2

    It is people like you that force up prices. If the y feel they can get away with it, the real estate will up the price.

    You are paying an artificial price as it is… and you want to pay more!

  • People seem to have forgotten that during the height of the pandemic a lot of people in Victoria couldn’t pay rent.
    I know someone that has an investment property and the tenants living there could not pay rent.

    I also know plenty of people that offer to pay 6/12 months in advance to secure a spot.
    In this day and age you don’t know who will suddenly stop paying rent, if someone has had problem tenants that stop paying then they would probably rather someone that can pay in advance.

    I’m guessing if you break lease you lose the money.

  • Last time we we were looking for a tenant for our rental property we received 2 offers from the first open for inspection. One couple offered the asking rent and another couple offered asking rent + $10 pw. The second couple had a pet. We accepted the offer from the non-pet owners.

  • Depends where you are looking.
    Many inner city areas are competitive for landlords and agents with properties going begging for a tenant

    • Inner city apartments for students is really a renters pay what you want below market prices market .

  • +1

    I see some good arguments for B.

    I've had good experience with B.

    Let them counter with C I reckon, don't offer C.

    A is not an option.

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