Landlord Wants Me to Move out or to Increase Rent Because "They Can Not Afford My Current Agreed Rent" - Is This Allowed in NSW?

So this email just shook my world out of nowhere and is really making me mad about the whole situation.

My fixed term contract ends at 19 July 2021, which I thought would allow me to feel safe and not to worry about rent increases or whatever for a while. We agreed on a fair market price that we were both happy with. So today, 17 May 2021, I got an email from a landlord saying they:

"can't sustain the initially agreed weekly rental price and we will have to return it to the owner and vacate the place unless you agree to one of the two options:"

  • You can continue rent the place with the same fixed term contract but with a 60% rental price increase, starting from next week
  • If you don't agree to the weekly rental price increase, unfortunately you will have to vacate the property as we need to find new tenants.

"Please let us know your thoughts and consider this as official 2 weeks notice to vacate the premises if you decide for option 2. (last day will fall 28.05.2021)"

I looked into my contract and there is a section that reads:

17.3 LANDLORD reserves the right to give the tenant a minimum of 14 day notice to vacate the property with no early termination charges.

Are there any NSW laws/help/support that can cover me or am I stuffed because I signed a contract and gave my rights away?

Thanks for reading…

Comments

        • +2 votes

          THIS.

          These people who wrote the contract are morons, who have nfi.

          They will get slammed at the Tribunal.

          • +1 vote

            @IHatePeople: No, they're not morons. Morons can't help being morons.
            They are SCAMMERS, trying to catch people like OP who have NFI about what's legal and what's not.

      • +4 votes

        bahahahaha.

        Well now you now how much weight their legal documents will hold - close to zilch!

      • +4 votes

        Not legal, ignore that.

      •  

        Wtf $33 for 15 mins? I would tell them to gtfo. As many others have said, just because its written in a contract doesn't make it legally enforceable.

      • +1 vote

        This comment made me feel like this is a troll post… So if it's real, your landlord is a f idiot

      •  

        name and shame… bloody hell… that sort of behaviour pisses people off.

  • +10 votes

    Tell them to pound sand.

    Assuming your lease isn't 2+ years, then unless the exact rent increase is in the lease agreement (nothing wishy-washing like 'within market rates', has to be a dollar or percentage figure on a specific date), they can't increase it at all during your lease.

    The law always ALWAYS overrides whatever BS agents put in leases. You can't sign away your rights. They can't terminate your lease unless you refuse to pay it or severely damage the property with a court order, or they claim hardship and get that through a tribunal (good luck, no court will side with them given it's months away from a lease end date).

    What you should do is write to the agent (don't let them do anything that isn't in writing) that you refuse their rent increase and you refuse their illegal eviction notice. If they want to fight that then they'll have to take it to the tribunal, which will end up the same as a drug dealer calling the cops on someone who stole their drugs.

    • +8 votes

      The contract clearly states that rent price will only be renegotiated when extending the contract (aka signing a new fixed term). It does not say anything about increases during the fixed term contract.

      The law always ALWAYS overrides whatever BS agents put in leases.

      Good to hear but I will confirm tomorrow by calling some numbers.

      • +4 votes

        Well then, as far as I'm aware, you're in the clear.

        Absolutely call free legal support, they'll be able to tell you the exact sections of law that apply, which will almost always put agents/landlords on the backfoot. Their worst nightmare is a tenant who knows their rights, as the system is almost always stacked in the tenants favor.

        • +2 votes

          Their worst nightmare is a tenant who knows their rights

          And my biggest nightmare is them taking my bond because I became a smartass. I am sure they will start claiming that there's dust here and there and there's mould here so we need to take the whole bond of Blue Cat :)

          • +10 votes

            @Blue Cat: And when they try crap like that, you take them to the Tribunal AGAIN, and watch them lose, again.

          • +4 votes

            @Blue Cat: Make sure you use a good cleaning company (with bond return guarantee), and thoroughly document with video and photos the condition of the property on the day you hand over the keys. Maybe even include a newspaper with the day's date so they can't say the photos were taken earlier.

            In the end of isn't up to them whether they keep your bond, they'll have to satisfy the bond board that keeping some or all of the bond is warranted. And they will need to supply receipts of what they spent fixing it.

          • +8 votes

            @Blue Cat: You're legally entitled to attend the final inspection, so go with them and make them say it to your face.

            And then jump the gun and put in a claim for refund of bond money form before they can, as the government processes the first form they receive. Then the landlord has 14 days to dispute it, and if they don't you automatically get the entire bond back.

            If they do dispute it, then the onus is on them to prove damage/poor cleaning with condition reports and pictures, in NCAT. They have to be the ones to lodge the NCAT case as well if you get it in first.

            If NCAT sides with them, then the onus is also on them to prove that they spent bond money on actual services. You have the right to request receipts, and if they don't, you can bring them right back into NCAT.

            So if you really left it dusty, then they might be able to get away with charging you for professional cleaning services, but it'll cost them a lot more effort than it would you.

            Their worst nightmare is a tenant who knows their rights, for every aspect of tenancy. Because as a tenant you're able to wage asymmetrical warfare, and often any legal matters are a war of attrition.

          • +3 votes

            @Blue Cat: Further to what everyone else has said, in NSW, you can apply for the return of your bond.

            The LL then has to dispute it rather then the other way around. Just means the LL cops the tribunal filing fees.

            https://www.service.nsw.gov.au/transaction/apply-get-your-re...

            Were you given a copy of your in-going condition report and the receipt details for lodging your bond?

          • +3 votes

            @Blue Cat: I've got to wonder, did the Landlord actually lodge the bond with the appropriate authority as legally required to do? This LL sounds like one who would hold onto the cash.

  • +9 votes

    You have to feel for the owner though, what with constantly increasing interest rates!

    • +4 votes

      On crack maybe

  • +2 votes

    Are you currently paying well below market value for your rental?
    Was this agreed upon when covid allowed you to negotiate rent with your LL?

    • +2 votes

      Reading OPs comments, rent was set at time of signing the agreement - LL suggested an amount, OP agreed. Nothing to do with Covid.

  • +1 vote

    NSW rental law to my understanding, they can increase it (don't know about 60% though) by a good amount IF…… the surrounding area and similar places are around the same price.

    For example: If you're paying 400 per week then all of a sudden they want you to pay 640 per week but everyone else in your area with similar houses/units are paying 620 - 650 per week, and you're the only ones paying 400 per week then to my understanding they can increase it after your lease ends.

    This is from personal experience, don't know if its law or just agency policy. As people have mentioned, speak with the proper bodies

    • +9 votes

      That only applies after the lease ends, and they can only do it once every 12 months.

      Given they're still in a lease, and are planning to leave at the lease end date, nothing like that applies.

      •  

        Its a fixed lease so cannot do it, unless the method (i.e mathematical formula) is specified in the lease. Nearly no residential fixed leases have a method.

  • +8 votes

    Lol tell them to go (profanity) themselves. There are only specific situations where they can end your fixed term lease early, and even then, it requires higher authority (for e.g. NTCAT in the NT). These situations would involve you being a bad tenant- late rent/damaging house/illegal activities etc.

    They cannot kick you out without the above reasons. Not even if the contract says it.

    Send them one email if you like- "No". And then ignore them

  • +2 votes

    I looked into my contract and there is a section that reads:

    17.3 LANDLORD reserves the right to give the tenant a minimum of 14 day notice to vacate the property with no early termination charges.

    Agree with others it sucks and regulations indicate 60 days.

    Sounds like the lesson here for us all is, check before signing (fix it upfront), even if the rules don’t appear to be legally binding.

    • +1 vote

      I'm curious where you got the regulation that says 60 days?

      https://flatmates.com.au/info/nsw-landlord-termination

      This website specified a few situations where lease can be terminated but nowhere does it say the landlord can just tell renter to get out with 60 days notice.

      Relevant to OP's situation, landlord can give notice to vacate 30 days before termination date, AS LONG AS, termination date is after end of fixed lease.

      If it is terminated: "The landlord cannot lawfully terminate a fixed term tenancy before the end of the fixed term without a specific reason. If the landlord does terminate the tenancy before the end of the fixed term, the tenant can challenge it at the Tribunal and/or be awarded compensation."

      • +1 vote

        From this comment.

        • +2 votes

          Ahh, they are referring to the 60 day notice period for rent increase. But even then in only specific situations:

          1. Fixed tenancy of less than 2 years- Only if contract sets out how and when rent will be increased. Must be included in initial contract
          2. Fixed tenancy of more than 2 years- Once a year
          3. Periodic- Once a year
          • +2 votes

            @Tech5: This exactly, people seem to forget that there's a lease in place.

    •  

      Just because it’s in the contract doesn’t make it legal. Call the tribunal.

  • +6 votes

    The agreement is not legal in NSW as it violates the NSW tenancy laws w.r.t. notices. Min notice by law in NSW is 30 days and the 30 days is before the end of the existing contact, not 60 days before with 14 days notice.

    Ring up the nsw fair trading and ask what the law says and what your options are. They cannot give adive on what to do, but can give advice on if it is legal or not and what you can do about it.

    BTW 60% increase is crap. What are other units in the same block or comparable blocks of units renting for?

  • +2 votes

    Source NSW Fair Trading

    For agreements with a fixed-term of less than 2 years, the landlord or agent can only increase the rent during the fixed-term if the agreement sets out the increased amount or how the increase will be calculated.
    The term in the agreement must spell out the amount of the increase or the exact method of calculating the increase (e.g. a dollar amount or %). It cannot be unclear, for example statements 'in line with the market' or 'by the rate of inflation'.
    The landlord or agent does not need to give the tenant written notice of the increase
    For agreements with a fixed-term of 2 years or more, the rent can only be increased once in a 12-month period. A landlord must also give the tenant at least 60 days written notice.
    It is important to note that a tenant can give 21 days written notice and vacate before the rent increase kicks in.

    It appears its legal if method for the increase is provided in the contract. On other hand, If contract does not provide the details of the increase, it would not be legal. I would try to negotiate with the landlord to plan the moving to suit your schedule and move out to avoid dispute as you mentioned in your comment. If in doubt, contact NSW Fair Trading.

  • +26 votes

    Good morning everyone!
    I don’t have time to reply to you all because it looks like a busy morning at work, just wanted to say thanks for all the input and comments. I will be calling Fair Trading during lunch and see what they say.

    I really don’t want to take this further to the tribunal because I work monday-saturday and believe that a few days wasted trying to fight it will give me more loss than just continuing my work.

    I hope Fair Trading can give me some good news so I can stay the agreed duration and then get out of this “agreement” for good.

    • +4 votes

      OP. Get the ball rolling with Fair Trading… they will direct as need be.

      But I'd imagine NSW to be as strict as QLD in that land lords need to honour the duration of their tenant's lease period before being able to bump up rent in any capacity.

    • +5 votes

      All the best OP.

      Not 100% clear on current process in NSW, but NCAT do still have a page on video conference hearings.

      https://www.ncat.nsw.gov.au/ncat/how-ncat-works/on-the-heari...

      If LL does try to dispute (would be stupid as they'd lose), hopefully you can push for a hearing to be done remotely.

      Find out if it is purely a case of once it comes to your nominated time, you just sit aside for the duration of the hearing. The hearing should not be long as there is no legal obligation for you to move.

    • +7 votes

      I'd contact your local city newspaper too, if there was even a chance of naming and shaming your agent over this.

    • +4 votes

      OP, if it helps, apart from all the other points about the rent increase and termination of a fixed-term agreement early being illegal, the landlord can’t kick you out without going to the tribunal themselves to get an order. The onus is on the landlord, not you. And they won’t have any luck at the Tribunal.

      I’d just keep paying the agreed rent and plan to move out at the end of the fixed-term.

  • +8 votes

    Good luck OP, let us know how you go!

  • +3 votes

    Probably being mentioned many times. IIRC in NSW at least.
    - After the contract period ends, the Landlord must give 3 months notice to evict a tenant and the tenant only needs to give 1 month
    - You can't increase the rent excessively

  • +4 votes

    That's terrible and sounds so dodgy, especially the terms in the contract that are obviously unenforceable and would even work for you in a tribunal as evidence of how unreasonable the agent/landlord is.

    As others have mentioned - it can't hurt to contact media organisations about this. You might even get some compensation for telling your story which would help smooth the transition to a new place over once the lease ends.

  • +2 votes

    As mentioned above by another member, you must have entered into a sub letting agreement as the landlord is not the owner, as per your OP. This opens up another can of worms as they have a custom contract that you entered into, which you would be bound by.

  • +2 votes

    Your landlord is against all the tenant laws. Increase of rent without enough notice , increase of rent in fixed term and giving 2 weeks notice to vacate on the clause of rent increase before fixed term expire..so you can win your case , but only till your fixed term contract. so start fighting for your rights and also start looking for new place for july .

    • -2 votes

      Unfortunately you did not spot the OP saying that the landlord is not the owner and they are subletting with a custom contract….

      • +1 vote

        OP did not say that. he did say he was posting in a hurry and did not confirm he was in a subletting arrangement.

      • +3 votes

        I do not think you can sign away for rights. Entries in this custom tenancy agreement cannot overwrite Residential Tenancy Act 2010:
        https://legislation.nsw.gov.au/view/html/inforce/current/act...

        (4) Variation of standard form A residential tenancy agreement for which a standard form is prescribed may include additional terms, but only if—
        (a) the terms do not contravene this Act or the regulations or any other Act, and
        (b) the terms are not inconsistent with the terms set out in the standard form.

        •  

          You cannot sign your rights away.

          They are IN the legislation.

          Legislation trumps ANY contract.

  • +3 votes

    Lol, tell the agent you would like to see the NCAT order allowing them to do that in your case. I can see you are based in Sydney, which means NSW laws apply. From the wording you have used, the LL claims hardship (as it is "unsustainable at the current rent"). As per Fair Trading website:

    Reason for termination Hardship
    Fixed term / Periodic agreement Either (landlord) / Fixed only (tenant)
    Minimum notice landlord must give None**
    Minimum notice tenant must give None**

    ** No notice required but must apply to the NSW Civil and Administrative Tribunal (the Tribunal)

    Therefore, unless they already have that NCAT order, they are just trying out a power move to see if you will just yield and move out without asserting your rights.

    • +4 votes

      Even though, do start looking for a new place starting from July - I doubt you`d like to extend your stay past that point at your current place. Bad blood between you and LL/REA will be an unremovable stain on your relationship moving forward.

  • +3 votes

    None of this is lawful.

    Make your plans to move out on 19 July 2021. Make sure you also give the required notice too.

    Do not pay any extra rent before then.

    Don't worry about the bond, you will get it all back.

  • +3 votes

    14 days to vacate a property is just not enough time…
    https://www.tenants.org.au/factsheet-10-landlord-ends-agreem...

    There is a table there (minimum notice):
    Fixed-term agreement - No grounds - 30 days
    Fixed-term agreement - Breach of agreement - 30 days

    Fixed-term agreement
    Your agreement cannot be terminated because the premises are being sold.

    I believe the fact that the landlord is not the owner doesn't allow the landlord to do whatever they want. There is a valid tenancy agreement. The owner and landlord might be colluding, or the owner might be changing the agreement with your landlord, who decided to transfer the problem to you. Still, there is an agreement in place.

  • +4 votes

    Laugh in their face - They're dreaming.

    Absolutely nothing they're attempting to do will stand up at NCAT. If they attempt to forcibly evict you call the police.

    Don't worry about your bond either, there are plenty of provisions for 'reasonable' wear and tear, 'reasonably' clean etc. They need to prove damages to NCAT, not the other way around.

    With that said, everything in life is a negotiation - Perhaps there is an outcome that will suit you both. e.g "I won't follow through enforcing my legal responsibilities [insert detail] if you pay my moving costs and cover X weeks rent" aka "Pay me and I'll (profanity) off"

  • +2 votes

    lmao this landlord is nuts. I own a property and would only increase rent by $10, 60% increase is dumb. I assume this isn't through an agent but private rental

    • +4 votes

      Covid19 has made rentals crazy… Last year the market price may have dropped 35%. If the rental market have bounced back fully (which it has in many areas now), that means 60% increase would just get it back to the original rate.

      Makes sense for a landlord to want to meet the market price, but a contract is a contract.

  • +1 vote

    Interesting and love to see how this pans out, maybe OP could goto onthehouse.com.au and see what the last sale price was and how the suburb is trending.

    Im curious if a declining property value has made the bank ask for a margin call or adjustment to the repayment schedule.

    Maybe LL is leveraged to the t1ts and lost job?

    Bank might be your new LL soon.

    Is property rural or city?

  • +4 votes

    As above, not binding if it violates legislation protecting renters in your state.

    But you'll be looking for a place at the end of the contract. What do you believe is fair market value? If 60% is absurd, just move, or just tell them it's absurd and let them decide whether they really want to kick you out.

    My one contribution is a friend was renting out a family property at the start of covid, and took a low rental just to ensure he would be getting some income. A year later and that price is well out of whack with the market. Increased the rent by several hundred dollars per week, the residents thought they could find somewhere better and cheaper, and it turns out they are having trouble.

    So, check the market. Work out who is being unreasonable. And if you don't want to have to move, consider meeting at an agreeable near market rate.

  • +1 vote

    Get some cheapie wireless camera's, as the landlord sounds like they might try and visit in 2 weeks. Also, change the locks.

  • +1 vote

    Definitely can't increase rent until the fixed term is over.

    But also check your state laws, but many states they can't even increase the rent above CPI. They also might need like 12 weeks or something if they want to evict you without cause.

    So even after the fixed term is finished, it'll be unlikely they will be able to make you pay 60% more.

    • +1 vote

      Are you sure that landlords are not allowed to increase more than CPI, in any state?

      •  

        You'll need to check the legislation of the state you're in. It applies in the ACT

        •  

          I'm having trouble finding sources to confirm that. Could you provide it?

          The best source I've been able to find shows that it isn't the case - that landlords can increase rent up to 10% more than CPI.

          "The prescribed amount is 110% of the percentage increase. That is, a landlord can increase the rent on a property by ten percent more than the increase in the Consumer Price Index".

          https://www.justice.act.gov.au/sites/default/files/2019-10/F...

          • -1 vote

            @studentl0an: sure i guess technically it's 10% more than CPI, but to be honest, that barely makes a difference.

            So say you rent a house for $500 and CPI is 3% - so the maximum rent raise would be $16.50 instead of $15

            •  

              @witsa: Recheck your maths.

              If your rent is $500 and is increased by 10% over CPI (13% total) the increase will be $65, not $16.50.

              •  

                @studentl0an: I think it's not 10% of the total rent, is 10% of the CPI.

                So 10% of a CPI of 3% would be 3.3%.

                At least this is the advice I'm getting from my property manager.

                •  

                  @witsa: The document states "a landlord can increase the rent on a property by ten percent more than the increase in the Consumer Price Index"

                  To me that sounds like 10% more than the CPI, not CPI + 10% of CPI.

                  I think you should really find out with your property manager what the case is. It really doesn't seem right that the increase can only be CPI+(10%of CPI), as that would be far less than the increase in a mortgages that people are taking on as house prices increase far greater than CPI.

                  The average annual growth of house prices is more than 5% in ACT: https://www.yourinvestmentpropertymag.com.au/top-suburbs/act...

                  So if the increase in mortgages is 5% on the principal of the average home, surely the rent increase would be greater than that amount due to the risk involved with being a landlord as opposed to being a renter (with no risk in the form of a loan on the property). Then there's also the the increase in land tax and associated levies the landlord must pay which increase at the rate of valuation and not CPI.

                  The increase in land tax/year is up to 7.5% in some areas of ACT:
                  https://www.revenue.act.gov.au/rates/land-valuations

  • +2 votes

    Your lease trumps anything i wouldnt worry or respond - you have until your lease ends

    It isnt your problem if your landland is an idiot who bit of more then he/she could chew - ie if the property ends up mortgage-E (taken over by the bank) that isnt your problem because it would take at least 3-4 months for them to take over and sell the property

    Once the lease ends you will have to leave if you cant come to a new agreement

    Ill say this, it is LL like this idiot who give the majority of good LL a bad name - 60% increase whilst someone is under contract is Fked fair enough if you were out of contract and he asked you this but to try push this on a tenant whilst they have a contract is so dumb i cant believe they thought it was acceptable
    If it was me i would say im happy to leave within 4 weeks but the expectation is free rent till then and all moving costs are covered by LL i would also ask for my bond back and a waive on cleaning the property on vacating it

    You dont have long left so imho that would be the best way forward

  • +1 vote

    If the agreement does not specify a fixed-term or if the fixed-term period of the tenancy agreement has ended and the agreement is on a continuing (periodic) tenancy, then rent can only be increased once in a 12-month period.

    The landlord must also give the tenant at least 60 days written notice before the increase starts.

    This also applies where the tenancy is renewed.

    check https://www.fairtrading.nsw.gov.au/housing-and-property/rent...

  • +2 votes

    My guess is that the landlord is clueless! One of the possible problems of dealing direct with a landlord.

  • +3 votes

    Would love an update on the situation Op!

    Absolute madness from the LL…

  • +1 vote

    I think you may be taking the clause the wrong way,

    17.3 LANDLORD reserves the right to give the tenant a minimum of 14 day notice to vacate the property with no early termination charges.

    I think the intent of this clause is to allow the owner to release you from the contract if both parties mutually agree to ending the lease, otherwise it wouldn't mention the waiving of the fee's.

    Regardless, rent cannot be increased during a fixed term unless the fixed term is greater than 2 years, or if the lease specifically details the planned increases.

  • +1 vote

    Your fixed lease will prevail. But then after it expires in July, they can jack up 60%. The early termination clause is invalid.

  • +2 votes

    Write back and politely decline. State you will continue to pay your agreed rent until the agreed terms ends. Tell them you will renegotiate to reach a new deal or they can notice they don't want to continue.

  • +1 vote

    Can't be done… too bad. If your current lease states a certain amount, then that is the rate. However, after lease period, they can up the rent, but it must be reasonable.

    They can not evict you simply bc they want more money.

    Just ignore them.

    Document everything… time date etc.
    If they present a problem, take them to tribunal.

    It is a simple process and they will tend to assist you against ogre landlords

  • +1 vote

    "can't sustain the initially agreed weekly rental price and we will have to return it to the owner and vacate the place unless you agree to one of the two options:"

    Is this a scenario where a tenant of a property lets out a room to another tenant? I am just assuming from what I read.

    By the way I love your 8bit blue cat, reminds me of "Alley cat"

  • +1 vote

    Do you rent the whole house with a formal tenancy agreement or do you just rent a room ?

    There were times I rent a room, and 2 weeks notice is pretty the "norm"… just saying.

  • +2 votes

    Name of the agency?

    • +1 vote

      There needs to be a blacklist of landlords just like they have one for renters.

  • +108 votes

    OK so quick update for now. NSW Fair Trading was useless - first person didn't understand my problem, the second one I got after calling again said to follow my contract… which didn't give me much confidence.

    However, after calling my local Tenants' Advice and Advocacy Service number which I found on tenants.org.au, I got connected to a lady who was very understanding, supportive and eager to help, so I sent my contract and the eviction email to her. She called back later today and said this has got to be one of the dodgiest contracts she has ever seen, with illegal clauses galore never seen before. Worst of all, she believes this contract is pretending to be a contract where I am a "lodger", so the landlord believes the Tenancy Act wouldn't apply to me and they can do whatever they want, while in practice I am basically a sub-tenant for practical purposes, so the Tenancy Act should apply to me, but only the NCAT hearing can decide and confirm this 100%. There are high chances they will be forced to give me a 60 day eviction notice which I would be happy to oblige, but who the hell wants to go to NCAT?

    Also, she said, THEM trying to force me to pay THEM for going to the Tribunal is absolute lie and in no way can be enforced.

    Another thing, like some other ozbargainer commented, if they go presenting this contract to the Tribunal, it will be like a drug dealer complaining to the police that their drugs were stolen. She believes they should be avoiding going to Tribunal at all costs as they will be basically be showing all these illegal, incorrect and unenforceable clauses they made themselves! lmao

    I followed advice to write one more nice email to the landlord explaining that we can avoid a lot of drama if we just stick to the contract for the next 2 months and that I am happy to renegotiate our options at the end of the contract (yeah right, I am outta there!). I am "ready to exercise my legal rights" too!

    I can't answer all comments because I am burnt out from this bs and I got other crap to take care of. Just want to say thanks for the support and other input, I surely read them all and gave that sweet green +!

    Future looks promising… for now.

    • +11 votes

      Great thread, we actually get to see the ending, some post, the op does not tell us the ending. Thanks for the update. Threads like these teach all ozbargainer a lot. Really happy to see you got the advice you needed and you will be able to navigate this event.