Getting your bond back at the end of your tenancy can be one of the most difficult aspects of share housing. This is why it is very important that you are clear about your rights about the bond and make sure you do the necessary paperwork when you move in. You may still have difficulties recovering the bond but at least you will be in a better position if things go wrong.
If you are a tenant covered under the Residential Tenancies Act, the landlord cannot ask you for more than four weeks’ rent as bond. There is only one bond for one tenancy agreement, the landlord cannot make you to pay more bond because the rent has increased under the original Residential Tenancy Agreement.
In a co-tenancy the rental bond will usually be paid to the landlord by all the tenants and lodged with Renting Services under all the names. You should receive a receipt from Renting Services with a rental bond number. If you don’t, contact Renting Services and they will follow it up with the landlord.
At the end of the tenancy, if you have not damaged the place and do not owe any rent, you can claim your bond directly from Renting Services. If you have damaged the place or are behind in the rent the landlord can claim part or the entire bond. If you dispute their claim, you can apply to the New South Wales Civil and Administrative Tribunal (NCAT) to decide the matter. Contact your local tenants’ advice service for advice or see Tenants NSW factsheet for more information (see Useful Resources).
If the landlord makes no claim on the bond, it should be paid in full to the tenants. In order for Renting Services to release the bond, it will need the signature of all the tenants registered with the bond – or if this is not possible, a statutory declaration from the current tenants in the house stating that they are legally entitled to the bond.
Problems can arise in share houses if there is a dispute between housemates about how the bond should be divided.
For example, if one of your housemates causes all the damage that results in the landlord taking money out of the bond, you will all lose your bond money, not just the guilty tenant’s share. The only option you have in this situation is to try to come to an agreement with your housemate to pay the lost bond to you as a debt – or if this doesn’t work, take them to the Local Court to try and get the money back. But going to court can be expensive and takes up time and you’ll need to decide if the amount is worth the time and cost involved. Mediation with a community justice centre might help you reach an agreement without having to go to court (see Contact Points).
If you are a co-tenant in a periodic agreement ending your tenancy, but the remaining tenants intend to stay in the premises and continue the tenancy, you are entitled to be paid out your share of the bond when you leave. You can ask former housemates to pay back your share of the bond, and they are required to pay within 14 days of your request. They are entitled to deduct any rent that is outstanding or other reasonable costs associated with the residential premises from your bond. Once you have been paid out your bond money by the remaining occupants, you will not be entitled to payment of any of the money lodged with Renting Services at the end of the tenancy agreement, when everyone moves out.
You should all keep clear records that the bond has been paid out and lodge a “Change of Shared Tenancy Arrangement” form with Renting Services (see Useful Resources) to avoid any difficulties for the remaining tenants when they move out. If the remaining tenants do not pay the leaving co-tenant their share of the bond money, you can make an application to the New South Wales Civil and Administrative Tribunal (NCAT) for an order that your share of the bond will be returned to you.
If you are a sub-tenant with a written agreement, the head-tenant should lodge your bond with Renting Services. Unfortunately, it’s quite common for head-tenants not to lodge the bond and at the end of the tenancy decide whether to return the money. This is why it’s very important to get a receipt from the head-tenant for your bond when you first give it to them. Then if there is a dispute when you are moving out, you have proof that bond was paid and can apply to NCAT for an order for your bond to be refunded to you.
Tell your head-tenant that you will go to the Tribunal if it becomes necessary — this might encourage them to return the bond without having to go to the Tribunal. The Tribunal can make an order that the head-tenant refund your bond as well as referring the matter to the Commissioner for Fair Trading because your head-tenant failed to lodge the bond — which could mean they will be prosecuted or fined if the Tribunal finds in your favour.
Boarders and lodgers
If you are a boarder covered by the Boarding Houses Act, the security for your agreement is called a ‘security deposit’, and cannot be more than 2 weeks’ rent. The proprietor must give you a receipt for the deposit, and can’t require you to pay it before you enter the agreement. The proprietor is not required to lodge the security deposit with Rental Services. At the end of your occupancy, the proprietor can withhold some or all of the deposit for any damage to the property, for any rent you owe, for cleaning and for the cost of changing any locks you replaced. The proprietor must repay you the security deposit within 14 days of your agreement ending.
If you are a boarder or lodger not covered by the Boarding Houses Act, there is no set amount of bond that the landlord can charge. Ask for a receipt that shows what the payment is for. What your bond covers will depend on what you and the landlord agreed to, and it does not need to be lodged with Renting Services. Encourage the landlord to lodge the bond in case you have problems getting your bond back.
As a boarder or lodger not covered by the Boarding Houses Act, you generally cannot take your landlord to NCAT. However, if your landlord is ‘in trade or business’ of renting out rooms, you can make an application for a consumer dispute in NCAT. Your landlord could be “in trade or business” if he or she is running a boarding house or renting out more than one or two rooms. Seek advice from your local tenants’ advice service to find out what options are available (see Contact Points). Also, see Boarders & Lodgers Kit for more information (see Useful Resources).
One tenant in, one tenant out, tenancy agreement the same
In share houses, housemates often come and go without a new tenancy agreement being drawn up. What usually happens is that the tenant moving in pays the share of the bond of the tenant moving out, either to that person or to the people whose names are on the lease. If you do this, you should always get a receipt for any money paid. Importantly, you should also arrange to have the names changed on the bond registration with Renting Services.
You can do this easily by completing a ‘Change of Shared Tenancy Arrangement’ form available from Renting Services or from the NSW Office of Fair Trading website (see Useful resources). The person moving out and the person moving in, as well as the remaining occupants and the landlord must sign the form.
Another common but less formal method is for the person leaving to give you a signed letter saying that you have paid their share of the bond and it now belongs to you. You will have to show this letter to Renting Services when you claim the bond at the end of the tenancy.
If the original signatories to the bond have moved out and you have no proof that you share the bond, you will have to sign a statutory declaration that you are legally entitled to the bond for it to be returned to you. A letter from the landlord or agent saying that they have been receiving rent from you and recognise you as a tenant will also help to convince Renting Services that the bond is yours. Consult Renting Services for further information (see Useful resources).