TenantsTips / Australia / The Tenancy Agreement when Renting

The Tenancy Agreement when Renting

This article will outline all the things that prospective tenants need to know about starting a tenancy with the goal of helping tenants to understand tenancy agreements, including what they should expect from their tenancy and what they should avoid.

What is a residential tenancy agreement?

A residential tenancy agreement is a contract outlining the standard terms of a rental agreement. The purpose of the agreement is to ensure that both parties, the tenant and the landlord, understand the agreement they are entering into and have a clear understanding of their rights and responsibilities with regards to the agreement and the rental property.

There are two types of tenancy agreement, a fixed term agreement and a periodic agreement. A fixed term contract involves agreeing a tenancy for a specific amount of time, for example for six or twelve months. A periodic agreement does not specify a length or ‘term’ of contract and therefore runs on a rolling basis.

What are additional terms?

Additional terms are any terms agreed between tenant and landlord that fall outside of the standard terms of a rental agreement. To put it simply additional terms are merely extra points in an agreement. However, any additional terms in a contract must be agreed by both parties and must not conflict with either the standard terms or the Residential Tenancies Act 2010.

What should you know before signing a tenancy agreement?

Before you sign a tenancy agreement it is important that you understand exactly what you are agreeing to. Read through the paperwork a couple of times to ensure that the details are clear and fresh in your mind. Make sure you retain a copy of the agreement for your records and future reference.

There are certain things that your landlord is obliged to tell you about the property before you enter into an agreement, these things are often referred to as ‘material facts’. Before signing a contract you must be made aware of the following should they be applicable to the property:

  • Particular services and how they are conducted, such as waste services.
  • The property has suffered from serious bushfire or flooding in the last 5 years.
  • A violent crime has taken place at the property in the last 5 years.
  • The premises have health/safety risks that are not apparent on inspection.
  • Tenants are not eligible for free parking at the property.
  • The premises has a walkway or driveway that others can use.

The landlord (or their agent, if the agent is aware) must also tell you if either of the following applies:

  • They intend to sell the property (if they have prepared a contract for sale of the property).
  • A mortgagee has sought legal assistance to enforce a mortgage over the premises.

What happens when you sign a tenancy agreement?

If the tenant and the landlord agree the terms of the contract then both parties sign and the agreement is put into action. At this point the landlord is obliged to give you a NSW fair trading new tenant checklist or if you are renting a property in a strata scheme the landlord is required to give you a copy of any by-laws within seven days of signing the agreement. During the appointment the landlord is obliged to supply you with all the contact information you require, including the landlord’s phone number and business address. The landlord should also give you a condition report.

What is a condition report?

When you move in to a property the landlord or agent must give you a condition report. A condition report outlines the quality or state of the property. The condition report should be completed by the tenant and landlord at the start and the end of the tenancy. You should receive 2 copies – one to return to the landlord and one for you to keep. This report should be filled out and sent back within one week. If you are not supplied with a condition report, write down as much information about the condition of the property yourself and have a witness sign and date it. This report is designed to safeguard you and ensure that you do not get blamed for any problems within the property.

How much does a tenancy cost?

There are various ways in which a landlord might choose to financially secure your rental agreement. The most common options are a holding fee, a bond or rent in advance.

A bond is money paid up front at the start of a tenancy as a means of security. It is a monetary safety deposit and will be awarded to the landlord should you not fulfil the terms of your tenancy agreement. If you adhere to the terms and conditions of the agreement the bond money will be returned to you when the tenancy agreement is terminated and you leave the property.

A holding fee is money paid by the tenant in order to secure a property before a contract is signed. A holding fee can secure a property for 7 days and if an agreement is made the holding fee will be deducted from the total cost or initial rent.

A landlord or agent may ask for a payment of rent in advance. The amount paid cannot be more than the cost of two weeks rent.

What if there is a dispute?

Get advice from your local housing advisory service about applying to the Consumer, Trader and Tenancy Tribunal



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