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Rent Bidding in Australia: What Are The Laws?

As an international student in Australia, securing a place that feels like home is a big part of settling into life in Australia. However, the housing market has been complicated by the practice of rent bidding, contributing to an already challenging rental crisis.

As you search for the ideal place in your new host city, understanding rent bidding, its legal status in Australia, and where to seek advice if needed is key. This knowledge will help you navigate the housing market confidently, ensuring a smoother journey to finding your new home.

What is rent bidding?

Rent bidding happens when landlords or agents encourage potential tenants to offer more than the advertised rental price to secure a property. This situation often arises from listings that show a price range or don’t list a price at all, pushing renters into a competitive scenario. This practice can drive up rental costs, making it tougher for renters to find housing within their budget.

It’s important to note that rent bidding is not about tenants voluntarily offering more; it’s about being prompted or encouraged to enter into a bidding war by those managing or owning the property.

What are the rent bidding laws in Australia?

In response to the challenges posed by rent bidding, several Australian states and territories have taken legislative action. South Australia, Queensland, the Northern Territory, and the Australian Capital Territory have all banned rent bidding within the last year. These jurisdictions now join Tasmania, New South Wales and Victoria in prohibiting the practice of soliciting higher offers over the advertised rental price. 

Western Australia stands as the only jurisdiction yet to outlaw rent bidding formally, but legislation to ban the practice has been introduced and is expected to pass.

A common legislative theme across these areas is the requirement for a fixed price in residential rental property advertisements. It is now illegal to advertise properties without a fixed price, or using vague terms like ‘offers from’ or ‘by negotiation’, ensuring greater transparency and fairness in the rental market.

Everyday rent bidding scenarios

To help you better understand how these laws play out in real life, let’s look at two scenarios:

Scenario 1

Raj is on the hunt for his first apartment in Australia. He stumbles upon an online listing for what seems like the perfect place, except there’s no price mentioned. Curious, he contacts the agent to inquire about the weekly rent. Instead of a direct answer, the agent suggests, “We’re looking for offers. What’s the highest you can go?” Raj, eager to secure a spot and not fully aware of the implications, decides to offer significantly above what he initially budgeted, hoping it’ll make his application stand out. To his delight, Raj gets the apartment.

Is this rent bidding? Absolutely. The agent’s tactic of not listing a price and inviting potential tenants to submit their best offers is a classic case of rent bidding. This approach, encouraging bidders to outdo one another without an initial price, is illegal in many parts of Australia, as it lacks transparency and fairness in the rental process.

Scenario 2 

Mei has been searching for the perfect rental property for weeks. When she finally finds an apartment that ticks all her boxes, she notices it’s within a highly competitive area. To increase her chances, Mei decides to go above and beyond the listed price, offering an additional $20 per week on top of the advertised rent. She also offers to pay two months’ rent in advance, hoping these gestures will demonstrate her eagerness and financial stability to the landlord. The property manager, without any prior solicitation for higher offers, accepts Mei’s proposal, and she secures the lease.

Is this rent bidding? No, this isn’t considered rent bidding. In this scenario, Mei voluntarily decides to offer more than the asking price, without any encouragement or suggestion from the property manager or landlord. This kind of proactive approach by Mei is perfectly legal as it is a personal strategy to strengthen her rental application. It highlights the difference between a tenant independently offering more to secure a lease and being coerced into a competitive bidding situation by the property lister.

Where can I seek advice?

If you’re unsure about rent bidding practices or believe you’re being encouraged to participate in rent bidding, you can seek advice or make a complaint through government rental bodies in your state or territory:

For tips on applying for a rental in Australia, check out our comprehensive guide, How to Successfully Apply for a Rental Property.