Renting Out Your Property - A Lessor's Guide

Government of Western AustraliaDepartment of Mines, Industry Regulation and SafetyConsumer ProtectionRenting outyour propertya lessor's guideAn easy-to-read guide that explainsyour rights and responsibilitiesas a private property owner.iRentWAGet the app

DisclaimerThe information, including advice (‘information’)in the Department of Mines, Industry Regulationand Safety’s Renting out your property - a lessor’sguide (‘the Guide’), is provided by the officers ofthe department in good faith and derived fromsources believed to be accurate and reliable atthe time of publishing. Changes in circumstancesafter information is published in the Guide mayinfluence the accuracy of that information. Noassurance is given about the accuracy of theinformation. The information provided is of ageneral nature only and is provided solely onthe basis that you are responsible for makingyour own verification and assessment of it.If necessary, you should obtain your ownindependent advice (including legal advice) inrelation to your own particular circumstances.The information should not be understood towaive any legal obligations of persons/ entitiesto you, including persons who provide financialand real estate services. The State of WesternAustralia and its employees expressly disclaimany liability and responsibility for the informationcontained in the Guide. In no event shall the Stateof Western Australia and its employees be liablefor any injury, loss or damage resulting fromreliance on and/or use of the information. You/anyperson who relies on and/or uses the informationwaives and releases the State of WesternAustralia and its employees to the fullest extentpermitted by law from any and all claims relatingto the use of the information.What we doThe Department of Mines, Industry Regulationand Safety gives free advice to all parties ina residential tenancy agreement, looks intocomplaints, and, wherever possible, helps settlethem. If we can’t negotiate a fair outcome, it maybe necessary for the matter to be settled in court(see ‘Going to court’).However, our powers are limited to conciliationand prosecution of breaches of consumerlaw – only the courts can make orders ordeterminations (in other words, we can’t make atenant or lessor/property manager do something).We also provide the legislated bond managementservice for lessors/property managers to lodgethe tenant’s money. All new bonds must belodged with the Bond Administrator, located in ourCannington office. This is a free service.You can contact us by telephone or by calling atone of our offices (see the last page for details).Our website www.commerce.wa.gov.au/rentinghas a wealth of information on tenancy laws andother matters.The information provided in this publicationexplains and simplifies the law and should not betaken as a statement of law, for which you shouldrefer to the Residential Tenancies Act 1987 and theResidential Tenancies Regulations 1989.For the most up-to-dateversion of this guide, pleasevisit our website or scanthis QR code with yourmobile device.This publication is free. The Department of Mines,Industry Regulation and Safety has no objectionto lessors/property managers, tenants or othersphotocopying parts or all of the text.This publication is available on request in otherformats to assist those with special needs.ISBN 1-920837-03-5ISBN 1-920837-04-3 (Web)

ContentsIntroduction. 2The Act covers:. 2Getting started.4Agent or DIY?. 4Using an agent. 4Managing the property yourself. 5Option fees. 6Fixed-term or periodic tenancy?. 7Prescribed tenancy agreement. 7Security bond. 8Property condition reports. 9Before tenants move in.10Minimum levels of security.11Once the tenancy begins. 13Minimising problems.13Who’s responsible in a tenancy?.14Urgent repairs.15Water usage costs.16Water, gas and electricity bills.16Inspections.17A summary - who’s responsible in a tenancy?.18Rental payments.19Tenancy databases.21When things don't work out. 23If the rent is overdue.23Breaches of the tenancy agreement.24Ending a tenancy (other than for a breach of agreement).24Eviction - obtaining an order for possession.26The final inspection, property condition report and bond.27Abandoned premises.29Abandoned goods (excluding documents).30Abandoned documents.31Tenants affected by family and domestic violence.32All about notices - What to issue and how to do it. 34What to issue.34How and when to issue notices.35Going to court.37About the courts.37Applying for a court hearing.37On the day.38Rules of the court (which may vary slightly between the courts).39How the case is heard.39A final checklist. 41Glossary of terms in common use.42Contact details. 43Appendices. 44Appendix 1: Standard forms for use under the Residential Tenancies Act 1987.44Appendix 2: Chart one - Service of a Breach notice for failure to pay rent.45Chart two - Service of Notice of termination for failure to pay rent.46Chart three - Service of Breach notice other than for failure to pay rent.47Renting out your property - a lessors guide 1

IntroductionIf you are renting out a residential property inWestern Australia or thinking of doing so soon, theinformation in this guide will help you avoid manypotential problems.Renting in Western Australia is governed by aset of laws called the Residential Tenancies Act1987 (the Act) and the Residential TenanciesRegulations 1989 (the Regulations). You canbuy copies of the Act and Regulations from theState Law Publisher, telephone 08 6552 6000, ordownload copies from www.slp.wa.gov.au. Wealso advise you to periodically check whetherany changes have been introduced.This guide doesn’t take the place of the Act, nor doesit cover everything, but it will give you a good workingknowledge of your rights and responsibilities as alessor of a residential rental property.The term ‘lessor’ is used in this guide to describethe person who is renting out the property. Thisperson is commonly known as the ‘landlord’.The Act covers:Industry Regulation and Safety (thedepartment) and the Magistrates Court; your obligation to use a prescribed tenancyagreement if the agreement is in writing; the need to give the tenant a copy of theInformation for tenant (Form 1AC for awritten agreement or Form 1AD for anon-written agreement); use of the premises; discrimination against children; options for tenants affected by family anddomestic violence; urgent repairs; fixtures, renovations, alterations andadditions;right of entry by the lessor;payment of rent and rent increases;security bonds;assignment and subletting;who pays rates and taxes;ending a tenancy; andgiving of notices.Some parts of the Act may not apply to tenancyagreements entered into prior to 1 July 2013.See the Changes to Residential Tenancy LawFAQ at www.commerce.wa.gov.au/renting orcontact the Consumer Protection Advice Lineon 1300 304 054.Please noteThe laws referred to throughout this guide do notrelate to the following: boarders/lodgers (refer below); holiday accommodation; most long-stay caravan and park homeresidents (see ‘Caravan and park homeresidents’, page 3); hotels/motels; colleges; educational institutions (unless a for-profit the role of the Department of Mines, This publication covers agreements entered intofrom 1 July 2013.organisation prescribes the accommodation); hospitals/nursing homes/clubs; or certain homes for aged or disabled persons.If you have any doubts about whether your rentalsituation is covered by the Act please contact theConsumer Protection Advice Line on 1300 304 054for the cost of a local call.Be awareLessors, real estate agents, tenantsand the Department of Housing(formerly Homeswest) and its tenantsare bound by the Act.Boarders and lodgersTo understand your legal obligations and to avoidcostly court disputes, you should work out if youare providing accommodation to a tenant, boarderor lodger. Boarders and lodgers are a specialgroup of home dwellers in terms of the law. Unlikemost people who rent, they are not covered by theAct, however, it is important to know they still havecertain rights.A tenant is a person who pays rent and in return isgranted a right to occupy a residential premises,whether exclusively or not, as long as they are2 Renting out your property - a lessors guide

not a boarder or lodger. A tenant has exclusivepossession of the premises they are rentingwhereas a boarder or lodger has exclusiveoccupation of their room. A right of exclusivepossession means the right to exclude anyone,including the landlord, from the premises or theroom they rent. This is different from ‘exclusiveoccupation’ or use, where the occupant can havetheir own room in which no one else can staywithout their permission.A boarder is an occupant who shares thelandlord’s house, pays rent and receives someservices from the landlord, such as cooking andcleaning. A lodger is similar to a boarder, but maynot receive services from the landlord.The following factors may assist you to determinewhether you are renting to a tenant, boarder orlodger, however only a court can make a bindingruling about this.Depending on the documents that make up theagreement and the circumstances of the situation,a person is more likely to be a boarder or lodger if: the landlord exerts control and authority overthe whole premises, that is the boarder orlodger is entitled to live in the premises butcannot call the place their own; the landlord provides attendance or services(such as cleaning, linen or meals) whichrequire the landlord, or his or her servants, toexercise unrestricted access to and use ofthe premises; there are house rules, which are enforced; the landlord/owner/representative lives on site; the term of the agreement is for a shortperiod of time; and if you and the tenant only need to give a veryshort period of notice to leave. See Notice toleave below.If the agreement includes cleaning, linen or meals,the landlord needs unrestricted access and theoccupant does not have ‘exclusive possession’.Be aware there are other factors that may impacton whether the occupant is a boarder or lodger.Each case needs to be determined by lookingat the particular agreement reached betweenthe parties.Your obligations to boardersand lodgersAlthough boarders and lodgers are not coveredby the Act, common law obligations apply to yourtreatment of boarders and lodgers.For more information, please phone the ConsumerProtection Advice Line on 1300 304 054, visitthe boarders and lodgers page online atwww.dmirs.wa.gov.au/consumer-protection orrefer to the brochure Boarders and lodgers: a guideto your rights and responsibilities.The department suggests that if you want to rentyour premises to boarders/lodgers, you seek legaladvice on how to set up the situation.Caravan and park homeresidentsThe Act also covers long-stay residents ofcaravan parks and park home residents whoentered into or renewed a fixed-term long-staytenancy agreement prior to 3 August 2007that has not been renewed or extended. TheResidential Parks (Long-stay Tenants) Act 2006covers residents of caravan parks and parkhome residents who started long-stay tenancyagreements after 3 August 2007. Severalpublications and more information regardingresidential parks long-stay tenancy are availableat www.commerce.wa.gov.au/ResParksThe landlord is the person who providesthe room/s and gives the boarder or lodgerpermission to live there. The landlord keepscontrol and authority over the house, even if theboarder or lodger has a key, and can come intothe house without giving any notice.Just because the boarder or lodger’s room hasa lock, it does not automatically mean they haveexclusive possession of the room. The ‘house rules’may state the landlord is allowed to enter the roomunder certain circumstances without the boarder’spermission, for example, to clean the room.Renting out your property - a lessors guide 3