Rent increases

New rental laws came into effect from 29 March, 2021.

While the rent increase process described on this page remains largely unchanged, the new laws do affect some matters regarding increases.

In addition to the recent change of rent increases not being more often than every 12 months for new agreements (after 19 June, 2019), the law now requires the rental provider to specify how the rent increase was determined. This method must be included on the notice of rent increase. If the rental provider does not specify the method of increase, the notice may have no effect. Unfortunately, the new laws do not provide a definition of what a method of calculating a rent increase means. You may wish to seek advice if you receive such a notice.

The rent cannot be increased during a fixed-term tenancy agreement unless this is specified in writing in the agreement. Unfortunately many tenancy agreements put together by real estate agents include this term, so it is important to read the agreement carefully before you sign it. If you do not agree to that term you are entitled to negotiate having it removed or crossed out, particularly as rent increase clauses are not part of the standard prescribed terms for all agreements. If the landlord refuses to allow any negotiation of terms that are not standard prescribed terms, your agreement could be seen as being unfair under consumer law.

Note: if you and the landlord negotiate to cross out that term you should all sign next to the change to show everyone has agreed to this.

If you entered into a new fixed-term or periodic tenancy agreement on or after 19 June 2019 you cannot be given a rent increase more than once every 12 months.

If you have a fixed-term agreement that was entered into, or periodic tenancy commencing before 19 June 2019 you cannot be given a rent increase more than once every 6 months. However, if in a fixed-term agreement, entered into before 19 June 2019, once the fixed period expires and your tenancy converts to periodic, the frequency in which you can be given a rent increase converts to once every 12 months. The same applies if you were in a periodic tenancy commencing prior to 19 June 2019 but then signed up to a new fixed-term tenancy on or after 19 June 2019.

The relevant time intervals apply to periodic (i.e. month to month) tenancy agreements, and fixed-term agreements where the agreement allows for a rent increase during the fixed term. (If there is a clause in your fixed-term agreement that allows for more than one rent increase during the relevant time interval, it is invalid.)

The landlord must give you 60 days’ notice in writing of a rent increase and they must use the proper form, which must let you know of your right to apply to Consumer Affairs Victoria (CAV) to have the proposed increase assessed if you think it is excessive. The notice can only be for one rent increase.

If a notice of rent increase doesn’t meet all of these conditions it is invalid and you don’t have to pay the increased amount. If you have been given notice that your rent will increase and you think the notice may be invalid, we recommend you contact us, your local TAAP service, Tenancy Plus provider or Community Legal Centre for advice.

A notice of rent increase must be given to you in person, sent by mail, or by electronic method such as email if you have agreed to this. If you receive the notice electronically and you have not consented, check your lease and contact us for further advice.

If the notice is sent by mail, the landlord must add enough time for the mail to be delivered. Check Australia Post delivery times.

If you think that the rent increase is too high, you can request an inspector from Consumer Affairs Victoria come and inspect the property and assess whether or not the increase is reasonable. You must make the request within 30 days of receiving the notice.

Address your request to:
The Director Consumer Affairs Victoria
GPO Box 123
Melbourne VIC 3001
or email it to: renting@justice.vic.gov.au
or send by fax to: 8684 6310

The inspector should look at the condition of the property, the facilities, and any services provided with the property, and compare the rent proposed in the notice with that of similar properties in the same area. During the inspection you should point out anything that supports your claim that the rent increase is excessive. This could include:

• the state of repair of the property
• problems with the location
• what similar properties in your area are being leased for
• any facilities or services that are provided by you rather than by the landlord
• any work you have done, with the landlord’s consent or agreement,
• any change in the rent and condition of the property or facilities since the start of your agreement and since the last rent increase
• the number of rent increases (if any) in the last 24 months and the amount of each of those increases.

If you ask the inspector to assess the rent increase, once they have carried out their investigations they will provide both you and the landlord a written report with their opinion on the increase. If the inspector considers the rent to be excessive, they may try to negotiate a fairer rent with the landlord or real estate agent.

If they do not or cannot negotiate a fair rent, once you have the report you can apply to the Victorian Civil and Administrative Tribunal (VCAT) for an order that the increase not be allowed. You must apply within 30 days of receiving the inspector’s report.

If VCAT decides that the rent increase is excessive, it can order that the rent not be increased or that it be increased by a lesser amount. It can also set a period of time (up to 12 months) in which the landlord is not allowed to increase the rent. However, VCAT will make these orders only if the proposed increase would make your rent significantly more than it is for similar properties in the area.

If the rent increase comes into effect before your case is heard by VCAT, you should pay the increased amount until VCAT has made its decision. If the decision is in your favour, VCAT can order that the landlord pay you back for any increased amounts that you have already paid.

If your landlord reduces any services or facilities provided with the property (e.g. closes a communal laundry) without reducing the rent, you can request a report from Consumer Affairs Victoria as to whether you should be given a rent reduction. If the report is in your favour you can apply to VCAT for an order that the rent be reduced. You must apply to VCAT within 30 days of receiving the inspector’s report.

It is worth trying to negotiate with your landlord or estate agent over a proposed rent increase. They may be willing to reduce it, especially if you are an established and reliable tenant or you would have to move out because of the increase.

If you have an inspector’s report you can also use this to try and negotiate with your landlord or agent so you don’t have to take the next step of going to VCAT. Make sure that any agreement you reach is put in writing and signed by yourself and the landlord or agent and that you keep a copy of this agreement.

If the landlord or agent has given you a valid notice of a rent increase and you refuse to pay it, you will be in rent arrears (i.e. behind in your rent). If this gradually adds up to 14 days’ worth of unpaid rent, putting you 14 days in arrears, the landlord or agent can give you a 14-day Notice to Vacate and apply to VCAT to have you evicted. You would be given the chance to present your case at VCAT but there is always a possibility that you will be evicted.