A Canberra renter has designed an online tool to help others determine whether a rent increase proposed by their landlord is excessive.
The website's designer, Michael Turvey, said he saw a need for a simple tool to calculate rent increases.
"I'm in a Facebook group called Canberra Renters, which is kind of an advice group, and I was just seeing people constantly saying, 'Hey, I got this request for a rental increase. What can I do about this? Is this allowed? What's the rules? Do I have to say yes'?" he said.
"There's a lot of confusion out there."
It took Mr Turvey a weekend to design the website, rentincreasecalculator.org, which helps renters on a periodic tenancy work out whether a rent increase is above the regulated amount.
If an increase is found to be excessive, a renter does not have to agree. If a renter refuses an excessive rent increase, their landlord can apply to the ACT Civil and Administrative Tribunal to have the increase approved.
What are the rules?
According to the Residential Tenancies Act 1997, on a periodic lease - also known as a month-to-month lease - rent can not be increased at intervals of less than 12 months. The landlord must give eight weeks' notice of a proposed rent increase and specify if the increase is above the threshold.
The legislation states a rental rate increase is considered excessive "if it is more than the amount prescribed by regulation".
The prescribed amount is based on the percentage increase in the rents component of the Consumer Price Index for Canberra published by the Australian Bureau of Statistics.
The prescribed amount is 110 per cent of the percentage increase which, put simply, means a landlord can only increase the rent by 10 per cent more than the increase in the Consumer Price Index.
Mr Turvey said the calculations were confusing and complicated for renters.
"You can see this on social media, you can see people talking about this. They were asked for a rent increase well above the prescribed amount, they felt pressured or they didn't understand what they could do. They looked at the system and found it too complicated and so they just said yes," he said.
"When actually they have the option to potentially refuse and ask the landlord to seek an ACAT approval."
The rules on excessive rent increases don't apply to fixed-term tenancies. If the expiry of a fixed-term lease is approaching, the new rent amount is a matter for negotiation between the renter and the landlord.
Renters warned about consequences
Mr Turvey said renters should be aware of potential consequences to refusing a rental increase.
"I do want to stress this isn't a tool that tells people, 'Absolutely no, your rent can't be increased', because there are options for ACAT approval and you do always have to be thinking about the possibility of a no-cause eviction," he said.
Currently under review in the ACT, a no-cause eviction allows a landlord to evict a tenant at the end of their lease without reason, however 26 weeks' notice must be given.
"So it's not going to solve every problem but if it helps out a few people, that's very valuable," Mr Turvey said.
Joel Dignam, founder of advocacy group Better Renting, said the tool would help renters navigate "unhelpfully complex" regulations but warned it doesn't cover all situations.
"It's shifting the onus onto the investor to justify the increase and this tool makes it a lot easier to know whether the increase was actually above that threshold or not," he said.
"We do, however, have an issue where people often get a big rent increase as part of renewing a lease and unfortunately the regulations don't cover that situation.
"So people might be saying, 'I've been offered a new lease, it's a rent increase of 15 per cent'. Unfortunately, in that case, it is basically take it or leave it - you can't appeal against that sort of rent increase."
Mr Dignam said given the complex regulations, the ACT government should this information more accessible for renters.
"One thing [the government] did do in the regulations is actually require that when landlords issue a rent increase, that increase is meant to say whether it's above a threshold or not, so they did try to put a bit of responsibility on lessors to do that," he said.
"Now, from what we hear that's not happening at all and there's not really any effort to make sure that that is happening. Given that unfortunately it's falling on tenants to figure it out for themselves, a tool like this one from the government would have been great to see."
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