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Attorney-general warns tenants they may be liable for lost rent

21 August 2014 Staff Reporter

Increased vacancy rates and an overall decline in the ACT rental market have led to a number of tenants being hit with unexpected costs when they break their residential lease.

With property owners increasingly forced to lower rent to entice replacement tenants, the blunt message from Attorney-General Simon Corbell is that it's up to the present tenants to pay the difference, as reported by The Canberra Times.

Under the Residential Tenancies Act, tenants could be compensating the owner for up to 25 weeks after they terminate their lease, plus the cost of readvertising the property until a new tenant is found.

Although the situation has existed since 1997, the declining rental market has thrust it back into the spotlight.


An ACT Tenants Union spokeswoman said enquiries about breaking a lease were one of the top two categories of enquiry, particularly in relation to advertising costs and rental payment.

She said many tenants were unaware of the provision, leading to confusion and surprise when they terminated their lease and found themselves suddenly paying double rent.

''It’s a strange situation where the market is both beneficial for tenants but also has difficulties for tenants, particularly if they are made redundant in this current job market,'' she said.

Real Estate Institute of the ACT chief executive Ron Bell said declining rental prices in Canberra have only recently been felt by real estate agents and owners.

''Twelve months ago people were just walking in and saying 'I can’t afford this' and then walking straight out – there was quite a lot of that,'' he said.

The attorney-general's clarification comes just one month after the ACT government announced a wide-ranging review of the Residential Tenancies Act 1997, which was welcomed by the Tenants Union and remains open for community input until September 12.

Attorney-general warns tenants they may be liable for lost rent
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