Shelter SA says rent bidding is still prevalent
Rent bidding remains common in the South Australian rental market, according to a new report from peak housing body Shelter SA.
Rent bidding became illegal in South Australia in September last year, but executive director of Shelter SA Alice Clark said the change has been widely misunderstood.
“They haven’t actually banned rental bidding, that was the headline. What they’ve stopped is… the agent going back to another applicant and saying… I’ve just been offered $320, will you pay $340?” Clark told InDaily.
“To ban rent bidding would have said the agent cannot accept more than the advertised price. That would be banning rent bidding.”
The law change does not prevent tenants from putting in an unsolicited offer above the asking price.
Last year’s changes to the Residential Tenancies Act also mean rentals can only be offered at a set price, rather than being advertised with a price range, but Clark said this was not an entirely effective change either.
“The other thing that people are still allowed to do is put a sign up at or near the property with a price range on it. So that as you’re coming to the inspection, you can see the sign,” Clark said.
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Shelter SA’s 2024 report was based on a survey of landlords, real estate agents and tenants and was open from November 2022 until February 2024. It therefore included responses from before and after the rental law changes were implemented.
The survey found the number of residents who paid additional bonds was up by 4 per cent and, in a change from previous reports, the majority of lease terminations were by landlords.
“For many years it has always been that there’s slightly more tenants who end tenancies than landlords, but that has gone down, from 58 per cent to 44 per cent,” Clark said.
Clark said she thought a major reason fewer tenants were ending their tenancies was due to the lack of accessibility in the rental market.
“I hear people aren’t asking for maintenance, they’re not asking for repairs, they’re terrified. They just want to lay low and not come to the attention of the landlord or the agent because they know how hard it is out there,” she said.
“Anecdotally we hear about leases coming to an end and not being renewed because owners want to put up the rent so significantly, they know that a family can’t afford it.”
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Shelter SA executive director Alice Clark said the body’s new report showed many changes still need to be made in South Australia’s rental market. Photo: Facebook
The report found the pandemic was cited as the reason for 73 per cent of rent increases in 2024, an increase from 23 per cent in 2022.
“One of the things that we advocated for during the rental law reform process is that we introduce some sort of limit to how much rents can be increased,” Clark said.
“We keep hearing these horror stories about people saying, ‘my rent went up by $150 a week’. So that is a missed opportunity that the government had no interest in doing, when according to this survey that has affected three times the amount of tenants.”
Last year’s changes prevented a third-party acting in trade or commerce, other than the property agent, from assessing a prospective tenant based on an offer of higher rent, with a penalty of up to $20,000.
However, agents and landlords are still able to approve applications that have offered additional rent amounts.
Other recent changes to rental laws in South Australia include a limit on rent increases to once a year and an increase in various penalties to landlords that reach up to $50,000.
Minister for Consumer and Business Affairs Andrea Michaels said the recent changes would provide tenants with “more security in their rental home”.
“At a time when South Australian tenants are facing unprecedented levels of housing insecurity, we want to ensure tenants have the best possible protections in place including stronger rights, more financial stability and better long-term security,” Michaels said.
Clark told InDaily that while “having a law that protects renters is all well and good… having access to those rights is another matter”.
“We know that very few tenants access the tribunal, so I think we need a tenant union in South Australia like we have in other jurisdictions,” Clark said.
“We don’t have a tenant union, we don’t have a homelessness peak body like all the other jurisdictions do. I think if we had those funded services, we could see more renters having better access to their legal rights.”
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