Moving into a new rental property is expensive. Upfront costs typically include two weeks’ rent in advance and a bond, usually equal to four weeks’ rent.

Who holds the bond?

The bond is viewed with scepticism by many, being perceived as an extra income for the landlord. This is incorrect: the bond is to help cover costs of damage, additional cleaning that may be required, or rent arrears, at the end of a tenancy. Furthermore, the rent is not held by the landlord or property manager, but must immediately be forwarded to Tenancy Services, who hold the money until the tenancy ends. On the termination of a tenancy, tenants sign a bond refund form in order to have the bond money refunded to them.

Refunding the bond.

BUT, and this is the critical point, Tenancy Services will not release a bond if the names and signatures on the bond refund form do not correspond with the names they have on their records as current tenants.

Signing a bond lodgement form.

At the start of a tenancy, the tenants who pay the bond must sign a bond lodgement form. Where there is no damage, the property is left clean and tidy, all rubbish is removed, and no outstanding rent is owed, the bond will be reimbursed in full to the tenants.

Signing a change of tenant form.

When there is a change of tenant during a continuing tenancy, ALL tenants, that is, continuing tenants, departing tenants and new tenants, must complete a change of tenant form. Bond refunds for their share of the bond should be between the departing and new tenants.

It is essential that the change of tenant form is signed by all relevant parties each time there is a change of tenant. The signatures on the bond refund form MUST be the same as the signatures on the bond lodgement form or the latest change of tenant form. Failure to do so will result in a potentially long delay in the bond, often the money required to pay the bond for the next rental property, being refunded. As property managers, we try to keep on top of changes of flatmates in flats. But unless the tenants advise us of flatmate changes, it is extremely difficult for us to keep accurate records. We rely on tenants to tell us when there are changes within a flat under a continuing tenancy.

For more information on bonds and bond refunds, refer to the Tenancy Services website here.