Every day the prices of each and every item are increasing around us and hence there is a steep rise in the prices of property that we are seeing. Now one may resort to blaming the landlords but it isn’t there fault too. If you take a look at the statistics, the trend of upward prices is same everywhere and is quite justified as well. The land is a scarce resource and by the law of economics, the more scarce the higher is the price.
Many times, landlords feel it a little difficult to increase the rent as the existing tenants have already entered into an agreement with the former wherein the prices are already quoted. Also, as per the existing NSW law, there is so less power given to tenants in terms of negotiating the rent. Their only option is to negotiate with the landlord and if this doesn’t give the desired results, all one can do is go to NSW Civil and Administrative Tribunal (NCAT) notifying them that the new rent being imposed is too high. Also, the quantum being high and not justifies is the burden of the tenant to be proved in the tribunal. Because of these, there is tenant who generally avoids the work and hence settle for the rent being imposed.
As a landlord, you can’t increase the rent all of a sudden. Remember you have signed an agreement wherein you have made a promise regarding all associated payments. Hence without disposing of it, you cannot alter the rent. You may have an escalation clause as part of agreement saying that the rent will be increased as per inflation or any other basis that you may want.
Now, once the landlord wants to increase rent, the tenant has very few options on his hand. They can both agree to the increase and pay the higher amount. However the first thing that everyone does is negotiating with the landlord, however, there is no guarantee that this will be useful. If you don’t want to pay the increase in rent you may approach to NCAT with the appeal that the increase in rent is not justified. This is a 60 day notice period. Further, you have 30 days as a tenant to prove the non-justified increase.
Many people do not get into all this and try to find the new place. Now, this can be messy and will lead to disturbing of routine for some time. But as a tenant, there are very fewer options available. The market can be clearly said as dominated by landlords. The current rate of vacancy in Sydney is 1.6% which quiet much proves the point.
