On 23 May 2024, the Queensland Government passed the Residential Tenancies and Rooming Accommodation and Other Legislation Amendment Bill 2024 (the Bill). This Bill introduces the Stage 2 rental law reforms and continuing professional development (CPD) for property agents in Queensland.
As more information is released, I will be updating each section on my Let’s Talk blog, and will link to these sections once completed. The Let’s Talk blog posts are designed to provide extensive information regarding tenancy laws and obligations, for both Lessors and Tenants, as well as provide best practices on these topics.
RENT AND OTHER PAYMENTS
- Re-letting costs
- Rent payments
- Utility bills
RENTAL BOND PROCESSES
- Maximum bond
- Evidence for bond claims
NEW REGULATIONS & ENFORCEMENT
- Information sharing
- Providing false and misleading information
PART 2: Stage 2 Tenancy Law Reform
“The reforms that will help to ease cost of living pressures for renters and support the Residential Tenancies Authority’s (RTA) compliance function will commence on 30 September 2024” – the QLD Government.
Will be calculated on the remaining time on the tenancy and whether the fixed term agreement is greater or less than three years.
Residential tenancy agreements entered into before the proclamation date of 30 September 2024, that include a term requiring Tenants to pay reasonable costs for reletting the premises and comply with the requirements of the previous section (s357A (1)) will be considered compliant under the new Act and will still apply at the agreement end date.
Reletting costs for fixed-term agreements are calculated based on how much of the lease has expired.
The specific reletting costs depend on how much of the agreed tenancy duration has passed when a tenant vacated:
- Less than 25%: 4 weeks rent
- 25% to less than 50%: 3 weeks rent
- 50% to less than 75%: 2 weeks rent
- 75% or more: 1 week rent
For agreements up to 3 years it’s the lower amount of the specified reletting costs or the rent until a new Tenant moves in.
In these examples, the RTA illustrates how reletting costs are calculated based on different scenarios of lease duration and weekly rent. For instance, with a fixed lease term of 12 months and a weekly rent of $500:
- less than 25% of fixed term expired: if a Tenant breaks the lease after 3 months (25% expired), the reletting cost would be 4 weeks’ rent, totalling $2,000
- 25% to less than 50% of fixed term expired: breaking the lease after 6 months (50% expired), results in a reletting cost of 3 weeks’ rent, totalling $1,500
- 50% to less than 75% of fixed term expired: breaking the lease after 9 months (75% expired), results in a reletting cost of 2 weeks’ rent, totalling $1,000
- 75% or more of fixed term expired: if the lease is broken after 11 months (91.67% expired), the reletting cost would be 1 week’s rent, totalling $500.
These calculations demonstrate how reletting costs vary depending on the percentage of the tenancy term that has expired at the time of tenancy termination, using a weekly rent of $500 as the basis.
For agreements over 3 years, reletting cost is the lesser of:
- 1 month’s rent for each 12-month period remaining of the term of the agreement, up to a maximum amount equal to 6 months’ rent, or
- based on the rent that would be payable until a new agreement begins after the premises are relet.
Due to the complexity of individual tenancy arrangements, the RTA does not provide reletting cost calculation services as this is best calculated between parties using the guidance and examples provided above.
The RTA are currently developing an online reletting costs calculator to support customers navigate these changes. Once launched, this tool will enable Tenant and Agent/Owners to independently calculate reletting costs based on their specific lease terms and rental agreements.
If there is a dispute about reletting costs that cannot be resolved by mutual agreement, the matter may proceed as follows:
1. Bond claim dispute: the dispute can be addressed through the bond claim process at the end of the tenancy
2. Notice of Unresolved Dispute: if the dispute is not resolved during conciliation, the RTA will issue a Notice of Unresolved Dispute
3. QCAT resolution: the unresolved dispute will then be referred to the Queensland Civil and Administrative Tribunal (QCAT) for a formal decision.
No additional costs can be requested from a Tenant. Reletting costs are calculated based on how much of the tenancy remains.
However, this calculation does not include any outstanding amounts such as unpaid rent in arrears, service charges, or damages to the property where a Tenant is still accountable.
Any amount specified in a QCAT order in relation to reletting costs in favour of a Agent/Owner cannot exceed the reletting costs that would be payable using the calculations as set out in the Act.
RENT PAYMENTS
Tenants must be offered two (2) ways to pay rent including away that does not incur more than usual bank costs and is reasonably available to a tenant.
Agents/Owners must offer tenants at least two options to pay rent. One of these options must not exceed reasonable transactional costs (costs beyond standard transaction fees), and it must be reasonably accessible to the tenant.
Fees charged by a third-party rent platform for using the platform may be considered unreasonable transaction costs.
This means that if a third-party rent platform charges fees to tenants for paying their rent using the platform, another method of paying rent must be offered by a property manager/owner that is:
- a platform that does not cause a tenant/resident to incur costs (beyond standard transaction fees); and
- reasonably accessible to a tenant/resident, (the circumstances of each case dictates what is considered reasonably accessible).
Before signing a tenancy agreement, Agents/Owners must provide a written notice outlining any associated costs incurred by using the payment methods offered. This is because Agents/Owners should be aware of costs associated with the offered payment methods, especially if these costs are not reasonably known by the tenant.
Failure to comply is considered a breach of the Act, with a maximum penalty of 40 penalty units.
Direct debit is an automatic transaction that transfers money from one bank account to another. This is usually set up by a tenant and allows a recurring withdrawal of money from their nominated bank account to pay rent.
The Act does not define what reasonable transactional costs are; however, it does offer guidance that such costs could include:
- bank fees for direct debits
- cash advance fees for credit card transactions
- any other account fees typically incurred by tenants.
Similarly, the Act does not define what ‘reasonably accessible to the tenant means. This is because what may be considered reasonable for one tenant could be impractical for another tenant, depending on their unique situation. What is considered reasonable must be assessed on a case-by-case basis.
There are two options for either an Agents/Owner or a tenant to change rent payment methods during a tenancy.
1. Option one: changes to payment methods by agreement:
- an Agents/Owner or tenant provides written notice to the other party requesting a change to rent payment methods
- the other party reviews the proposed changes and agrees in writing
- the new rent payment methods are then used going forward, replacing the methods in the original tenancy agreement.
2. Option two: changes to payment methods without agreement:
- an Agents/Owner provides written notice to a tenant offering at least two new payment methods
- the methods must not exceed reasonable transaction costs to the tenant and must be reasonably accessible to the tenant.
- a tenant must adopt one of the new methods provided within 14 days of receiving the notice.
Both options one and two, require a property manager/owner to:
- Provide written notice to a tenant outlining any costs associated with the new rent payment methods offered. This is because Agents/Owners should be aware of costs associated with the offered payment methods, especially if these costs are not reasonably known by a tenant. Failure to comply is a breach of the Act, with a maximum penalty up to 40 penalty units.
- From 1 May 2025, disclose any financial benefits they may receive if a tenant uses a specific rent payment method. Failure to comply is also a breach of the Act, with a maximum penalty of 20 penalty units.
The changes do not apply to existing agreements. However, if a Agents/Owners intends to change how rent is paid during an existing agreement, they must notify a tenant about any associated costs, or from 1 May 2025 any financial benefits a Agents/Owner may receive as a result of using the new payment method.
UTILITY BILLS
A tenant must receive utility bills within a four-week timeframe unless the managing party has a reasonable excuse, otherwise the tenant does not need to pay.
There are also changes to how water charges are calculated and can be charged when a tenancy begins or ends during a billing period.
For general service charges in tenancy agreements, moveable dwellings, and rooming accommodations where tenants pay for utilities or other services, a property manager/owner must provide a tenant with a copy of the document from the relevant service provider that shows the charges. This must be done within four weeks of the property manager/owner receiving the document.
This requirement applies to individually metered utilities for moveable dwellings including utilities services for rooming accommodations. It does not include service charges or utilities services that are included in the rent.
A tenant is not required to pay for service charges if a property manager/owner fails to provide a copy of the document from the relevant service provider showing the charges within four weeks of receiving it to a tenant. This applies to general tenancy, and rooming accommodation agreements and moveable dwellings.
It’s a document given to a property owner by the water supplier. It shows how much a property owner must pay for water used in the property.
Partial billing refers to a billing for a period that includes only part, not all, of the time covered by the water usage charges document. For example, if a tenancy agreement starts on 1 February, but the water usage charges are specified from 1 January to 31 March, the partial billing period would be from 1 February to 31 March.
A tenant pays for water during a partial billing period if the following conditions are met:
- the premises has its own water meter
- the premises meets water efficiency standards
- a meter reading is recorded in either the entry or exit condition report
- the partial billing period starts when the rental agreement begins
- the amount owed is calculated based on a reasonable estimate of a tenants/resident’s water consumption using the meter reading from the entry or exit report
- the rate used for calculation is the current rate stated in the water consumption charges.
To prevent disputes, the RTA strongly advises both parties ensure the meter reading is recorded in both entry and exit conditions reports at the beginning and end of the tenancy.
The Act does not specify who is responsible for recording the meter reading in these reports. According to section 166A (2) of the Act, a tenant may not be required to pay for water consumption charges for a partial billing period if the meter reading is not recorded in an entry or exit condition report if:
- the start of the agreement aligns with the beginning of the billing period, or
- the billing period ends when the tenant hands over the premises.
MAXIMUM BOND
No more than four weeks rent can be requested by a managing party. There will be provision in certain circumstances for tenants to request a refund of bonds paid over the maximum amount prior to these changes coming into effect.
No, an existing rental bond for a current tenancy agreement that exceeds four weeks rent does not constitute a breach. If a new or renewed agreement is signed on or after 30 September 2024, the new laws will apply from this point.
Before 30 September 2024, property managers/owners were allowed to request a rental bond exceeding the equivalent of four weeks rent if the rent was more than $700 per week for general tenancy agreements, and $500 per week for rooming accommodation agreements.
Excess bond amounts can only be claimed if a tenancy is renewed after 30 September 2024. After this date, a rental bond cannot exceed the equivalent of four weeks rent and the tenant can claim any excess bond amounts from the RTA using the new excess bond refund form that will be created, which requires all bond contributors to sign the form before it can be processed by the RTA.
If a tenant chooses not to claim any excess bond amounts during a tenancy, the bond will remain with the RTA until the tenancy ends and a Refund of rental bond (Form 4) is lodged.
A property manager/owner may voluntarily release any excess bond amount to a tenant using a Refund of rental bond (Form 4) to partially refund the current bond.
A tenant is not required to claim, and a property manager/owner is not required to refund the excess bond if a tenancy agreement is renewed after 30 September 2024.
However, if a tenancy is renewed after 30 September 2024 and a tenant chooses to claim any excess bond amounts, all bond contributors must provide their signatures on the new excess bond refund form that will be created for the claim to be processed by the RTA.
If all contributors do sign, the RTA must notify the property manager/owner of the new bond amount after the excess bond has been refunded. This refund cannot be disputed.
If all contributors do not sign, the refund request for the excess bond cannot proceed and will need to wait until the end of the tenancy for a non-agreed bond refund process.
No, a claim for the excess bond cannot be processed if all bond contributors do not sign the new excess bond refund form that will be created. All contributors must provide their signatures for the claim to be processed.
The RTA recognises that bond contributors can change during a tenancy. The bond record can be updated with a Change of Bond Contributors request.
What happens if not all bond contributors sign the new excess bond refund form?
The RTA cannot process the refund request without signatures from all bond contributors. If not all contributors sign, the refund request for the excess bond cannot proceed and will need to wait until the end of the tenancy for a non-agreed bond refund process.
If a tenancy is renewed after 30 September 2024 and the bond exceeds the equivalent of four weeks rent, a tenant can claim the excess bond.
The RTA will notify the property manager/owner of the new bond amount after the excess bond has been refunded.
If a tenancy is renewed after 30 September 2024, the RTA is required to refund excess bond to a tenant if they submit the new excess bond refund form that will be created signed by all bond contributors, and if the bond exceeds the equivalent of four weeks rent based on the current weekly rent amount. This refund cannot be disputed.
EVIDENCE FOR BOND CLAIMS
When making a bond claim or disputing a bond, a property manager/owner must provide a tenant with supporting evidence within 14 days of lodging a claim or dispute.
For bonds lodged with the RTA before the proclamation date, a 12-month transitional period from 30 September 2024 will apply, allowing the sector to prepare for this change.
Bonds lodged after the proclamation date 30 September 2024 will require supporting evidence to be provided when the property manager/owner claims or disputes the bond.
A property manager/owner must provide evidence to a tenant that supports their bond claim or bond dispute. Evidence may include receipts, repair quotes or records of unpaid rent.
Evidence must be provided to a tenant within 14 days of the bond claim or bond dispute lodgement.
Failure to comply is a breach of the Act, with a maximum penalty of 20 penalty units.
Note: if a tenant has impaired or limited capacity, either under guardianship or power of attorney, a property manager/owner must provide supporting evidence to the appointed person or representative, or to both a tenant and their representative.
For rental bond refund requests lodged with the RTA before the proclamation date 30 September 2024, a 12 month transitional period from 30 September 2024 to 30 September 2025 will apply, allowing the sector to prepare for this change. This means that evidence does not need to be provided for bond claims until after this period expires.
Rental bond refund requests lodged on or after the proclamation date 30 September 2024 will require supporting evidence to be provided to a tenant when a property manager/owner claims or disputes a bond refund request within 14 days of the bond claim or dispute.
Not providing supporting evidence to a tenant when a claim or dispute is made against a bond is an offence. Failure to comply with these requirements may result in a maximum penalty of 20 penalty units.
Note: evidence must be provided to the tenant, not to the RTA.
No, these are two distinct processes. The 14 day Notice of Claim (NOC) for a bond claim is not the same as the 14 day period for a property manager/owner to provide supporting evidence to a tenant/resident. For further information review the Notice of Claim process online.
Although property managers/owners are obligated to provide supporting evidence to tenants/residents within 14 days, a tenant/resident may dispute a bond claim by lodging a dispute resolution request with the RTA within the timeframe specified in the Notice of Claim process.
If a tenant/resident fails to do so it will result in the disputed bond amount being paid to a property manager/owner even if evidence has not been provided to a tenant/resident. However, failing to provide evidence is an offence under the Act and the RTA will investigate incidents of non-compliance.
The Act does not define supporting evidence; however, it does offer examples of acceptable evidence such as:
- receipts
- repair quotes
- records of unpaid rent.
An Agent/Owner must make reasonable efforts to contact a Tenant within 14 days of the bond claim or bond dispute lodgement to provide supporting evidence. If, despite these efforts, they are unable to reach the Tenant, the requirement to provide evidence does not apply.
Although the Act does not define what reasonable efforts means examples of acceptable efforts including:
- a call, text, email, or a private message to the Tenant on social media
- contacting an emergency contact listed in the tenancy agreement, or
- if a Tenant has impaired or limited capacity, either under guardianship or power of attorney, a property manager/owner must provide supporting evidence to the appointed person or representative, or to both
the Tenant and their representative.
INFORMATION SHARING
A tenant must receive utility bills within a four-week timeframe unless the managing party has a reasonable excuse, otherwise the tenant does not need to pay.
There are also changes to how water charges are calculated and can be charged when a tenancy begins or ends during a billing period.
PROVIDE FALSE AND MISLEADING INFORMATION
A tenant must receive utility bills within a four-week timeframe unless the managing party has a reasonable excuse, otherwise the tenant does not need to pay.
There are also changes to how water charges are calculated and can be charged when a tenancy begins or ends during a billing period.
For general service charges in tenancy agreements, moveable dwellings, and rooming accommodations where tenants pay for utilities or other services, a property manager/owner must provide a tenant with a copy of the document from the relevant service provider that shows the charges. This must be done within four weeks of the property manager/owner receiving the document.
This requirement applies to individually metered utilities for moveable dwellings including utilities services for rooming accommodations. It does not include service charges or utilities services that are included in the rent.
A tenant is not required to pay for service charges if a property manager/owner fails to provide a copy of the document from the relevant service provider showing the charges within four weeks of receiving it to a tenant. This applies to general tenancy, and rooming accommodation agreements and moveable dwellings.
It’s a document given to a property owner by the water supplier. It shows how much a property owner must pay for water used in the property.
Partial billing refers to a billing for a period that includes only part, not all, of the time covered by the water usage charges document. For example, if a tenancy agreement starts on 1 February, but the water usage charges are specified from 1 January to 31 March, the partial billing period would be from 1 February to 31 March.
A tenant pays for water during a partial billing period if the following conditions are met:
- the premises has its own water meter
- the premises meets water efficiency standards
- a meter reading is recorded in either the entry or exit condition report
- the partial billing period starts when the rental agreement begins
- the amount owed is calculated based on a reasonable estimate of a tenants/resident’s water consumption using the meter reading from the entry or exit report
- the rate used for calculation is the current rate stated in the water consumption charges.
To prevent disputes, the RTA strongly advises both parties ensure the meter reading is recorded in both entry and exit conditions reports at the beginning and end of the tenancy.
The Act does not specify who is responsible for recording the meter reading in these reports. According to section 166A (2) of the Act, a tenant may not be required to pay for water consumption charges for a partial billing period if the meter reading is not recorded in an entry or exit condition report if:
- the start of the agreement aligns with the beginning of the billing period, or
- the billing period ends when the tenant hands over the premises.
