Thursday, September 19, 2024

Red flags to look out for when signing rental lease agreements

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In a competitive rental market, many people are facing stress and anguish just trying to find a property.

So when you finally get your hands on a lease, you may not feel like exerting any bargaining power.

But experts say lease agreements are one of the things residential laws do well, ensuring tenant rights are upheld and they can’t be caught off guard.

And, you still have many rights to challenge lease agreements once they are signed.

Here are the red flags and points to look out for to make sure you’re getting the real deal.

Is it the standard contract?

Chris Martin from UNSW City Futures Research Centre said most people were not aware that residential tenancy agreements were largely standardised across states and territories.

There is a standard form full of terms prescribed by the law, with little room for landlords to make up things such as eviction notice periods or access to the property.

“So one lease will look very much like another except for the amount of rent to pay,” Mr Martin told the ABC.

When it comes to rent increases, the standard is tenants must be given at least 60 days’ notice and it must be given in writing.

And generally, if you have a fixed-term agreement, your rent must not increase before the end date.

There are terms tenants should look out for when signing a contract that go beyond what is reasonable and lawful.(ABC Gold Coast: Dominic Cansdale)

Every lease also needs to make sure the property meets basic minimum standards.

These include having functioning water and electricity, and heating in places such as Tasmania and Victoria.

So, you shouldn’t be coming across anything that says the tenant must accept the property no matter what condition it’s in, or that you need to pay for repairs.

“The law has said tenants have these rights and responsibilities and landlords can’t get out of those just by putting a contrary term in a tenancy agreement,” Mr Martin said.

And If you do sign a contract without knowing it goes against those standard terms, it legally won’t hold up.

“It’s not that you will be legally bound to these unlawful terms, it’s that you’re dealing with a landlord who doesn’t know what they’re doing,” Mr Martin said.

“And that’s a problem in itself.”

Unlawful (or unreasonable) additional terms

While there’s the standard form for the basics, there will often be extra pages stapled to the back with a whole lot of additional terms.

These are allowed, but they need to be lawful and reasonable.

Ben Cording, lead community education lawyer at Tenants Victoria, said there was a time when landlords would put in conditions such as not being allowed to light incense.

But now there is a list of prohibited terms, depending on state and territory legislation, that can’t be included.

“A lot of these terms were just going above and beyond,” he told the ABC.

“Sometimes they’re so overly restrictive it means you can’t really use a place without getting in trouble.”

Generally, you can’t get evicted for breaching these terms, he said.

And many can be easily challenged, even once the lease has been signed.

“You might have a term that says you can’t do auto work in the driveway,” Mr Martin said.

“You could quite legitimately go to the tribunals and say, ‘look, I think this term is too onerous. Yes, I’ve got an obligation not to cause damage, but I’m a mechanic and have drop sheets.'”

Taking a matter to the Victorian Civil and Administrative Tribunal (VCAT) costs about $70, with options for those in financial hardship, Mr Cording said.

And if you lose, there’s no additional fee, “you just move on”.

“It’s pretty informal and often the hearings are still being done over the phone,” he said.

Dodgy bond transfers

There are many scams doing the rounds targeting renters, which usually involve transferring a deposit or bond for a property that doesn’t exist or can’t be rented to you.

Scammers advertise rental properties on well-known property websites. When you express interest, they say they are overseas or interstate and you must conduct the transaction online.

If you send a deposit via a money transfer, there is little chance of recovering your money.

“Don’t pay cash or instant transfer. Make sure you use PayPal or something where there’s some sort of trust function involved,” Mr Cording said.

In Victoria, most bonds are now managed through the Residential Tenancy Bond Authority (RTBA).

A hand holds a mobile phone with property on it.

By law, rental advertisments must include a fixed price, and that includes those listed on Facebook Marketplace.(ABC News: Mark Leonardi)

Many scammers will lift an ad from another page and re-list it as their own, so they can appear very genuine, with photos, real addresses and land title deeds.

But often the asking price for rents is a lot cheaper than other properties in the area.

“The golden rule we tell people is, trust your gut. If it’s too good to be true, it probably is,” Mr Cording said.

And when you can, try to deal with a registered agent, rather than searching on Facebook, Flatmate Finders or Gumtree.

Terms for pets and extra tenants

Although it’s not a red flag, Mr Martin said pet clauses often caught tenants off guard.

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