More than a third of Canberrans rent their homes – and a worrying number believe their landlords can ban pets and guests, make them pay unnecessary expenses, and control their private lives, according to a report published yesterday.

Better Renting’s review of tenancy terms in the ACT, The Path of Lease Resistance, states that lessors and agents are subverting standard tenancy terms through inconsistent, unenforceable additional terms.

Some of the more “outrageous” additional terms include: “I will never invite friends home for party or overnight stay”; a $50 penalty for smoking in the house/patio/garage area; ducted heating during winter limited to 6 hours a day at 21 degrees; or that the owner may visit and inspect the property at 10 hours’ notice.

Canberra renters have felt forced to sign four or five pages of ‘sneaky’ additional terms simply to get a house in Canberra’s competitive market. “All the extra terms are confusing, and it makes me wonder if I’ve got fewer rights,” said one tenant.

“When you don’t have a house, it’s the only shot you’ve got,” said another. “The additional terms are a condition of signing the tenancy, so it manipulates the power dynamics. It’s very difficult for tenants to refuse.”

Better Renting called on the ACT Government to introduce a prescribed tenancy agreement; penalise real estate agents / landlords who use inconsistent terms or mislead renters; set up a landlord register, and train landlords; and remove endorsement provisions in the Residential Tenancies Act 1997.

“When signing a lease,” Better Renting director Joel Dignam said, “the relationship between landlord and tenant is fundamentally unbalanced: the tenant needs somewhere to live and isn’t in a position to negotiate. Allowing the landlord to use this power to reduce their own obligations is contrary to the spirit of the law and it means weaker protections for people who rent.”

“With more people renting in the ACT, and renting for longer,” the report stated, “the ACT Government cannot sit back while thousands of citizens are being taken advantage of by a more powerful, better-informed cohort, who know how they can avoid their obligations under the law.”

The ACT, moreover, the report states, is the only Australian jurisdiction that does not prohibit ‘contracting out’ (terms in the tenancy agreement that contradict the prescribed terms).

But because few tenants understand the law, they assume they must obey any terms they sign – even if inconsistent with ACT legislation, which states that inconsistent terms are only binding if endorsed by the ACT Civil and Administrative Tribunal (ACAT).

“Many tenants incorrectly believe they are bound by requirements that are onerous, sometimes costly, and often affect their ability to use their home in peace and comfort,” the report reads.

Background

The ACT system, introduced a quarter of a century ago, was meant to make it easier for tenants and landlords to agree on a contract that suited both parties.

In 1994, the ACT Community Law Reform Committee (CLRC) recommended that a standard tenancy agreement (a prescribed form used by every landlord and agent) should form the basis of all ACT tenancy agreements.

“Parties would not be able to contract out of this arrangement, although they would be able to include additional provisions in the agreement, provided they were consistent with the agreement,” then-Attorney General Gary Humphries explained.

Instead, the Better Renting report noted, the government decided that every tenancy agreement must include 100 standard terms that form the Standard Residential Tenancy Terms (SRTT).

This, Mr Humphries argued, would give landlords and tenants more latitude in drawing up the tenancy agreement.

“This approach captures the significant benefits of the original recommendations made by the CLRC, while allowing parties the capacity to craft their own agreements consistent with standard terms or, if they wish, by simply incorporating the standard terms.”

But Better Renting believes the rental relationship skews ‘latitude’ strongly in favour of the landlord. Additional terms, it claims, undermine the ability of the Residential Tenancies Act 1997 to provide for standard rights and obligations of renters and lessors.

“The current state of affairs is unjust, unreasonable, and inconsistent with the original intent underpinning the Residential Tenancies Act,” the report reads.

“The regulation of tenancy terms in the ACT is a failure of seemingly well-intentioned legislation.”

ACT Government response

Attorney-General Shane Rattenbury promised that his office would closely look at the Better Renting report and consult with stakeholders.

“We want to make sure that tenants are not being taken advantage of. My concern is that some people do not know their rights or don’t know how to enforce them, so it is important that tenants are aware of their rights and obligations under their tenancy agreement.”

The ACT Government’s Renting Book helps tenants to understand tenancy laws, including inconsistent terms, Mr Rattenbury said. If a tenant is unsure about a proposed inconsistent term, they can obtain legal advice before signing the agreement.

Better Renting noted that although the SRTT require landlords to give a copy of the Renting Book to tenants, this occurred rarely; many tenants were unaware the book existed.

The ACT Government funds Legal Aid ACT to provide free and confidential legal advice to tenants in the ACT, Mr Rattenbury stated.  They can be contacted on 1300 402 512. If the landlord misled the tenant into believing an inconsistent term was enforceable, they may have engaged in misleading and deceptive conduct under Australian Consumer Law.

The ACL already provides for significant penalties if a person is found to have engaged in misleading and deceptive conduct, Mr Rattenbury continued. If a tenant believes their landlord has misled them, they can complain to Access Canberra on 132 281.

For more news:

• Calling all superheroes: support HeartKids in fight against congenital heart disease
• Local handmade witchy wares offer a little bit of magic
• Check your mirrors: 3 things rooftop solar can teach us about Australia’s electric car rollout
• The elements reign supreme at CSO Classic Afternoon
• Are our suburbs making us sick? An award-winning urban planner thinks so