New laws will close a loophole to prevent landlords from being able to increase rents beyond the legal limit when tenants renew their fixed term tenancy, or where there are changes to the agreement – such as a housemate moving out, the ACT Government states.

This law – part of a tranche of proposals to reform the rental sector put forward by ACT Greens MLA, Jo Clay earlier this year – will provide renters with fairer conditions and greater financial surety, Attorney-General Shane Rattenbury said.

“We are in a housing crisis, and we know that the rental market is unfairly skewed towards landlords,” Mr Rattenbury said. “The new laws passed today are just a few of the changes needed to provide greater housing security for renters.”

Under ACT law, rent increases are limited by a formula linked to the CPI for Canberra rents. The new laws will ensure that in all tenancies, landlords cannot impose a greater rent increase unless the tenant agrees, or the Tribunal approves it.

“This will make rent increase laws simpler, consistent and easier to understand,” Mr Rattenbury said.

The Bill allows victim-survivors of domestic and family violence to end tenancies quickly and without penalty.

“This will make it easier for people experiencing violence to change their housing arrangements where they need,” Mr Rattenbury said.

The legislation also supports share-housing arrangements by making procedural requirements around starting and ending a tenancy more flexible.

It makes a number of de-regulatory reforms for charities and recruitment companies.

Other changes include:

• Implementing national fundraising principles: The ACT is meeting its commitment to reduce red tape for charities, to ensure the same fundraising rules apply across the country, allowing charities to focus on their vital work.

• Removing licensing requirements for recruitment companies: As part of the ACT Government’s Better Regulation Agenda, employment agents at recruitment companies will no longer require a licence to undertake their work. This will ease companies’ financial and regulatory burden.
• Enhanced consumer protections: The Commissioner for Fair Trading will be able to fine businesses and traders who fail to attend scheduled consumer conciliations for low value consumer claims (less than $5,000).

“This legislation is about creating a fairer and more equitable ACT,” Mr Rattenbury said. “We’re removing unnecessary obstacles for charities and businesses while ensuring that renters, especially those escaping domestic violence, have the support and protection they need.

“We believe that everyone deserves a safe and secure home. These reforms demonstrate our commitment to building a stronger, fairer and more compassionate living and working environment for Canberrans.”

“This legislation gives more tenants protection against excessive rent increases. The ACT is the only place in Australia where the law sets clear limits on how much landlords can increase the rent. We’re protecting our most vulnerable and making renting simpler and fairer.”

Ms Clay said: “For a long time, the ACT has had the best renters’ rights in the country, but in a housing crisis we need to go further and faster. Today’s amendments are a small change, but they do close a loophole which allowed rental prices to increase for many in a market already slanted against renters.”

Better Renting

Renters’ groups welcomed the announcement, but the real estate sector disagreed that the ACT’s rental market heavily favoured landlords, pointing to strict tenancy protections and limitations on rent increases and lease terminations.

Joel Dignam, executive director of Better Renting, said: “The ACT has had some great protections against excessive rent increases, but these applied only during a periodic tenancy. We’d often hear from renters who were offered a lease renewal at a much higher rent and were confused by this, and also worried that if they said no, they might be forced out of their home. These changes by the government close this loophole so that renters are protected from excessive rent increases including when renewing the lease. This makes the system simple and fairer. It’s a great way to improve stability and affordability for rental housing.

“The changes for victim-survivors are also very welcome. Now, it will be easier for people experiencing domestic violence to get out of a tenancy with a minimum of fuss. This will help keep people safer and reduce the stress of what would already be an awful situation.”

Real Estate Institute of the Australian Capital Territory (REIACT)

“REIACT welcomes aspects of the legislation that provide consistency and support for victims of Domestic Violence,” CEO Maria Edwards said.

“We disagree strongly however that the rental market is unfairly skewed towards landlords in the ACT; if anything, we have the strictest tenancy protections in the country. Currently, a rent increase of anything over 1.82 per cent ( the current prescribed amount) is legislatively considered ‘excessive’ so ACT landlords do not have the ability to recoup the increases in rates, land tax, insurances and increased borrowing costs as in other States. ACT landlords have very few options to terminate leases, disallow pets or refuse tenancies changing occupants during a fixed term, rights which are still available in the majority of the other States.”