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Queensland Residential Sellers on Notice: New Tenancy Disclosure Requirements

The various REIQ residential contracts have been updated in line with the recent changes to residential tenancy legislation.

 

The Residential Tenancies and Rooming Accommodation Act 2008 (RTRA Act) applies annual limitations on rental increases to a residential property, rather than a particular tenancy. This means that a landlord or agent must not increase the rent for residential property more than every 12 months since the last rent increase for that property.

 


The amendments to the REIQ residential contracts require the seller to disclose and warrant information regarding rent increases relating to the property within the previous 12 months as follows: 


  1. Disclose: - Whether the property has been subject to a Residential Tenancy Agreement or Rooming Accommodation Agreement at any time in the previous 12 months before the Contract Date; - If so, the date of the last rent increase.

  2. Warrant that:       - The statements in the contract regarding any tenancy agreement/s are true and correct; and       - If there are tenancies, the current rent complies with the requirements of the RTRA Act, as applicable on the date of each tenancy.

  3. Deliver:       - to the buyer at settlement, evidence of the day of the last rent increase under the RTRA Act.

The obligation to deliver evidence of the last rent increase under the RTRA at settlement does not apply to sellers who qualify as exempt lessors under section 82A of the RTRA Act. “Exempt lessors” is a limited category including for example, the State or where the lessor is a replacement lessor under a community provider tenancy agreement, so is unlikely to apply to most REIQ Residential Sale Contracts.


A breach of the sellers’ warranties regarding any tenancy agreement may entitle the buyer to claim compensation from the seller. This is the buyer’s only remedy for a breach of these obligations, and the buyer may not delay settlement or withhold any part of the purchase price because of any related compensation claim.

 

The consequences of failing to deliver the required evidence at settlement may be more severe for a seller, as this obligation is an essential term of the contract. This means that failing to provide the required evidence at settlement may entitle the buyer to terminate the contract.


Key Takeaways:


Sellers and agents should be aware of these updates and ensure that sellers under any updated REIQ residential contract comply with their obligations relating to residential tenancies to avoid possible claims for compensation from or termination of the contract by the buyer at the 11th hour.

 

Please contact a member of our property team if you have any queries about how the updated REIQ sale contracts may impact you or your clients, or if you would like advice on whether special conditions can address any particular concerns you may have relating to these updates.


Richard Waring, Director 

(07) 3307 4545


Matthew Shannon, Director

(07) 3307 4506


(07) 3307 4542


Vicky Stott, Senior Associate

(07) 3307 4509




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