The State Government will ban ‘rent bidding’ to minimize soaring rental prices and bring SA in line with other states, as part of a continued push to ease housing affordability. The average price of rent in Adelaide is now a record (median) high of $450 per week (houses and units combined) and the vacancy rate is among the lowest in the nation at 0.6 per cent.
“I understand how tough the rental market is for South Australians with rental prices continuing to rise and Adelaide having one of the lowest rental vacancy rates in the nation,” said Andrea Michaels MP, Minister for Consumer and Business Affairs.
This has encouraged rent bidding where tenants are encouraged to offer above the advertised price to secure the property. The practice will become illegal as part of reforms to the Residential Tenancies Act 1995 to be introduced to Parliament.
The practice of rent bidding unfairly drives up prices and is contributing to the current rental crisis by making it more and more difficult for South Australians to find affordable rental accommodation.
Landlords will no longer be able to advertise properties with a rent range, put properties up for rent auction, or attempt to solicit offers over the advertised rental price. Additionally, where a third party is taking care of tenancy applications, any rating or assessment of a prospective tenant must not be based on an offer of higher rent. This significant reform brings our great state in line with other Australian jurisdictions, which have introduced restrictions on rent bidding.
The government is committed to improving protections for tenants as well as ensuring landlords can continue to manage properties effectively with further work being done on additional changes in coming months. The reform comes after the government received considerable feedback from tenants as well as landlords and stakeholders as part of the review.