How to Deal with Rent Increases In SA

Step 1 – Know Your Rights

The Residential Tenancies Act 1995 outlines the rights you have as a tenant when renting in SA.

Landlords/rental providers must provide tenants with at least 60 days written notice to the tenant before a rent increase
Rent can only be increased in the following scenarios;
- Fixed agreements
  - If there is a clause in your rental agreement stating the rent will increase, it needs to say how this will be worked out (or a specified amount)
  - increase cannot start until 12-months after the agreement or the last increase
  - with an offer for a lease extension (provided it has been 12 months since the last increase or the start of the agreement).
- Periodic agreements
  - increase cannot start until 12-months after the agreement or the last increase
  - with an offer for a lease extension (provided it has been 12 months since the last increase or the start of the agreement).
There is no limit on the increase, however, if you believe the rent is excessive/unreasonable you can apply to SACAT and challenge the increase.

Step 2 – Steps to finding out if your rental increase is fair

Log in to your www.rentrabbit.com.au account
Select “Dashboard” from your drop-down menu
Select the “Suburb Trends” option from your taskbar
Type in your Suburb name (in this example we have used Ridgehaven)
Ascertain your suburbs % increase

Step 3 – Calculate your suburb’s median % rent increase

Using Ridgehaven we will calculate its median % rent increase
- In this example, in the last 12 months, the median house rent when from $380 to $410.
  - $410 divided by $380 = 1.0789
  - (1.0789 minus 1) times by 100 = 7.89%
  - Therefore, the median house rent in Ridgehaven went up 7.89%
Now let’s calculate your property’s value (if you were based in Ridgehaven, remember to always use your suburb in part 1).
- Your landlord is requesting an increase in rent from $400 p/w to $460 p/w.
- $460 / $400 = 15% increase (therefore your landlord’s increase is over 7% more than the current market data suggests)
- What the suburb data is showing is that for a $400 p/w property the increase should be:
  - $400 * 0.079 = $31.60 increase
  - $400 + $31.60 = $431.60
- We can see from this example the increase should be roughly from $400 p/w to $430 p/w

Step 4 – How to reply to your landlord/rental provider to propose a revised increase

Here is a draft response

“Hi {insert name of landlord or agent},

I’ve recently received notification of a proposed increase in rent from {$X} to {$X} per week. The suggested price increase is too high, the market in our area over the last 12 months suggests the median rate has in fact {dropped or risen slightly} to {X %}.

It would be great if we could discuss terms and find something we are both happy with. I enjoy living here and I am a good tenant, having kept the property in excellent condition.

To help with the landlord’s decision, below is recent market activity demonstrating a {house/unit} median increase in {Insert your suburb name} of {X%} from 12 months ago. We’d like to negotiate a 12-month fixed lease for {$X} considering the market rents for comparable properties.

{Insert median house/unit data from your suburb search}

In addition, it’s likely if we were to relocate that the owner would perhaps be up for a re-letting fee ($800-$1500), potential loss of rent if it was vacant and unknown quality of tenants.

Thank you,“