Tim Seidenspinner had lived in a room at a former backpackers hostel in Hobart for two years when he received an email out of the blue, accompanied by a sudden knock at the door from a real estate agent.
His rent would be more than doubling from $150 per week to $330.
And he was not the only one.
"On one end of the spectrum, there's one girl who pays $105, she pays now $330 – so that's more than triple the rent," Mr Seidenspinner said.
"We would all have to move out and either try to find something new or alternatively, essentially be homeless."
He was one of nine long-term residents living at The Nook in Hobart who received the notice on August 31, which took effect the very next day.
All of them would have to pay $330, which, for almost all of them, more than doubled their rent.
A tenants' advocate said it was a symptom of Tasmania's tight rental market, where vacancy rates in the state's three major centres – Hobart, Burnie and Launceston – range from 0.2 to 1 per cent.
Mr Seidenspinner moved into The Nook in August 2020, five months after the start of COVID when trade for the hostel ceased and it took on more long-term tenants.
Nine tenants remain, including people from India, Colombia and Germany, most of whom do not have permanent residency in Australia, and including those working in the gig economy.
They live in small rooms using common showers, toilets and kitchen.
Mr Seidenspinner said it was a stressful time for them all, and they had few options.
"That's more so because a lot of people living here don't have family here because they're foreigners," he said.
Appeal filed over rent rise
Mr Seidenspinner and two others have appealed to the Residential Tenancy Commissioner, claiming it was unreasonable.
Tenants in Tasmania must also be given at least 60 days' notice before rent increases, but he said this did not occur.
The rent increases came soon after CAC Property Pty Ltd settled as The Nook's new owner.
The company confirmed it planned to continue using the site for accommodation and has a development application with the City of Hobart.
Rent increases are considered "reasonable" under Tasmanian law if they are consistent with similar properties in the surrounding area. Other backpackers in the area offer long-term rooms for $180 to $250 per week.
Mr Seidenspinner said The Nook had not been operating as a backpackers' since COVID, and they should have the same rights as all residential tenants, including the notice period.
He said Hobart's rental market was incredibly tight.
"We've looked [for other rentals] before, when we knew that it was to be sold, we looked around as an alternative.
"There is just nowhere, and if there are places that are decent and affordable, you have 20 to 30 people turning up for one property, and your chances of ever getting it are slim to nothing," Mr Seidenspinner said.
Tight market forcing rents higher
Hobart has one of the tightest rental markets of any Australian capital city.
The vacancy rate sat at 0.5 per cent in August, with 157 properties available to rent.
A rate between 2 and 3 per cent is generally considered healthy for a rental market, and anything below it means there are more people looking for housing than there are houses available.
Tenants' Union of Tasmania principal solicitor Ben Bartl said this was forcing rents higher.
"Many landlords and real estate agents feel that they can ask for unsustainable rent increases," he said.
"The difficulty for most tenants is if they don't accept the rent increase, they can be evicted at the end of their lease.
"Most tenants who call us with unreasonable rent increases do not challenge the increase because they know that, come the end of their lease, they'll be evicted in favour of someone that is prepared to pay the increase."
In 2021-22, 36 tenants in Tasmania made an application with the Residential Tenancy Commissioner challenging rent increases.
Of those, six were found to be unreasonable, and a further 19 were "partly" unreasonable.
Earlier this year, Attorney-General Elise Archer confirmed the government was willing to review the Residential Tenancy Act.
