In a competitive rental market, rents can increase at an exponential level and can sometimes lead to negotiations in rental prices and some properties being out of reach.

There are no guidelines on what a “reasonable” rent increase should be and rental figures are influenced by the supply and demand on rental properties in the local market.

How much can it be increased by?

Each state has different rules and regulations on rent increases, the length of time for the increase and the conditions on when rent can be increased.

When determining a rent increase, current market conditions will be considered, and comparable properties will be investigated.

If you would like to know where your property may sit in comparison to other properties in the area, a search on property portals will give you an indication of what properties are renting or have rented for in recent times.

Every rent increase is determined on a case-by-case basis, taking into account the landlords’ obligations, the current market and the tenure of the property. If the market does increase, you may find in some cases that the landlord chooses not to increase the rent, or they will increase to keep the property in line with the market.

Is there a limit to the number of increases?

If you are in a fixed term tenancy agreement, unless it is pre-agreed at the commencement of the agreement, the rent cannot be increased until the term has expired.

If you are in a continuation or periodic agreement, rent can be increased, however, in some states, there is a limit to how often the increases can occur. Usually, this will be either six or twelve months.

Can you negotiate?

Sometimes there are options to negotiate the rent increase. If you choose to negotiate, it helps to investigate the local market and find rental comparisons.

Gather the evidence of comparables so that you can present these to your Tenant, Owner or Property Manager and justify what you feel would be a fair increase. You could also offer to sign a longer-term lease based on the increase.

If you do choose to go into a negotiation, it is important to have all of your information and enter discussions in a calm manner and prepare yourself for any outcome that may come from those negotiations.