When to request a rent reduction

Although it’s true that when we rent, we ultimately get what we pay for, there are times when things happen that we just don’t bargain for. In these unfair times, we can sometimes get a little relief from paying rent – either in part or in full.

It’s the law

Your lease agreement is your contract with the landlord. It sets out your rights and responsibilities as a tenant, as well as the responsibilities of the landlord. Although this contract varies from state to state and lease to lease, most lease agreements contain an express clause regarding rent reduction in certain circumstances. Moreover, even if your lease agreement doesn’t contain an express term, the law implies it. So rest assured, if you’re unable to use your property, you may be eligible for a rent reduction. So when are you entitled? We’ve set out some examples below.

• The landlord has breached the lease agreement: If your landlord’s failure to pay strata fees has resulted in you being locked out of your leased apartment, you can apply for a rent reduction.
• The premises have been destroyed: You may claim a deduction for the destruction of the premises whether in whole or in part, in circumstances such as fire damage due to faulty wiring or burst pipes that have caused flooding.
• It is uninhabitable: This means that for reasons you didn’t agree to, you cannot actually reside in the premises. An example could be the discovery and removal of asbestos, mould, or a termite infestation that has rendered the structure uninhabitable and potentially dangerous.
• It is illegal: You discover that the property you’re renting is no longer lawfully usable as a residence. It might have been rezoned into a commercial or retail property.
• It is acquired by another authority: Your landlord hasn’t kept up the mortgage repayments, so the bank has decided to foreclose on the property. This means you’re going to have a bunch of prospective purchasers coming to inspect the property and interfering with your own personal enjoyment.

In these circumstances, you have the right to request a rent reduction, but you’ll need to make the request in writing to the landlord (and make sure you keep a copy on file). You’ll also want to gather evidence supporting your claim for a rent reduction, such as photographs and independent inspection reports.

If you can’t come to a negotiated agreement with your landlord, you should apply to the relevant court or tribunal in your state to make a legal determination regarding the maximum rent payable during the period the premises were unusable. In New South Wales, for example, the Residential Tenancy Tribunal deals with matters of rent reduction when a landlord has failed to make necessary repairs within a reasonable time or at all.

However, please note that you will still need to pay your rent until such a determination is made. In other words, two wrongs don’t make a right. And you will need to take all reasonable steps to mitigate your loss. In some cases, you may even be able to apply for compensation for economic or physical loss you have suffered as a result.

It’s always a safe bet to notify the landlord right away if you need any urgent repairs. With fingers crossed, it will be fixed promptly and with minimum fuss. However, if issues do not get resolved, you may have a rent-reduction case on your hands.