Ten changes to residential tenancy agreements in the ACT you need to know

The Residential Tenancies Act 1997 is changing on 24 August 2017. If you are commencing or renewing a residential tenancy agreement in the ACT on or after this date these changes will affect you.

What’s changed?

  • Break lease fees: a break lease clause can now be included in a tenancy agreement requiring the tenant to pay a break fee for ending the agreement prior to the end of the fixed term. For most tenancy agreements the fee will be capped at either 6 weeks or 4 weeks rent, depending on when the tenant ends the agreement.
  • Termination for posting: the standard clause which allows a tenancy agreement to be terminated due to posting has been amended to extend the required notice period from 4 weeks to 8 weeks. The notice must now be accompanied by evidence of the posting.
  • Smoke alarms: a new requirement has been introduced which means a landlord must not enter into a tenancy agreement with a tenant unless compliant smoke alarms are installed in the premises. Yearly compliance checks are the responsibility of the landlord and tenants must replace batteries in any smoke alarms when necessary. The new requirements may also affect landlords of premises which are currently tenanted.
  • Return of bond: upon termination of a tenancy agreement the landlord must give to the tenant a signed bond release application form and if they wish to deduct money from the bond then the application must include reasons for the deduction. The bond release application form must be provided within 3 working days from termination of the agreement where no claim is being made and within 10 working days where a claim is made.
  • Keys: if the tenant does not return the keys to the premises at the end of the tenancy then the landlord can now deduct from the bond the reasonable cost of securing the premises.
  • Final inspection and condition report: the landlord and tenant must carry out an inspection of the premises at the end of the tenancy agreement and complete and sign a condition report based on the inspection. This is similar to the current requirements at the start of the tenancy.
  • Uncollected goods: the requirements regarding the disposal of uncollected goods will change so that personal documents must not be disposed of in a way that results in personal information about the owner of the document becoming publicly available.
  • Abandonment of premises: if a landlord has taken all reasonable steps to contact the tenant and believes that the premises have been abandoned then the landlord may enter the premises without prior notice or the tenant’s consent to confirm whether the premises have been abandoned. The landlord must not enter the premises on a Sunday, public holiday or before 8am or after 6pm.
  • Family violence & protection orders: there are now additional protections for victims of family violence including applying as a protected person to change or cancel tenancy agreements. Protected persons can also take practical measures to secure a property by changing the locks at their own expense.
  • Energy efficiency rating: if premises do not have an energy efficiency rating then the landlord or its agent will now need to disclose this when advertising the premises for rent.

What should you do?

  • Act now and ensure your property has compliant smoke alarms installed.
  • If you would like clarification around the changes or their timing, contact us to discuss.
  • If you are a landlord, we can provide you with a residential tenancy agreement that incorporates the above changes, and a checklist of all of your legal obligations, for an upfront fixed fee.

For more information contact the Property, Commercial and Finance Team:

Christine Murray — Partner — Property, Commercial and Finance
(02) 6279 4402

Jennifer Jaeschke — Associate — Property, Commercial and Finance
(02) 6279 4361