Tenant left shocked by $4,300 bill due to little-known rental rule

A tenant in Australia was left shocked after finding out that they would have to fork out thousands of dollars due to a little-known rule.

Renting a home is no picnic, and unfortunately increasing numbers of people are finding themselves trapped in a cycle due to the eye-watering costs it often incurs.

There's a bitter irony in being rejected for a mortgage with monthly payments less than what you pay in rent, all because the bank doesn't think you can afford it.

That is, of course, assuming that you can scrape together enough money for a deposit, and given how much this tenant had to pay just to begin renting a home, that seems like a pipe dream.

In renting, it's not only the eye-watering monthly cost of rent which sets back tenants, but also the insecurity of rented housing means that if you rent you're going to be moving a lot more frequently.

And of course, moving comes with its own raft of expenses which further strain tenants' finances.

We all know about the costs of losing a rental deposit due to 'cleaning fees' despite leaving a property spotless, but this tenant fell foul of something else.

This was a 'bond', effectively a form of holding fee, for the property.

But unlike a holding fee elsewhere, which can be hundreds, the rules around bonds in Queensland, Australia mean that they can reach thousands of dollars.

Real Estate Institute of Queensland CEO Antonia Mercorella told Yahoo Finance: "The maximum bond amount for general tenancies is set at four weeks rent - however, if the weekly rent is above [AU]$700, the parties may negotiate the bond."

This might sound beneficial in theory, but in practice it means that landlords effectively charge whatever they want if the rent is above AU $700 a week.

Tenant Erin and her partner found this to their shock when they were searching for a property in the range of AU$3,200, or AU $800 a week, around US $533 a week or $2,133 a month.

"There was an amount owing of [AU]$6,500," Erin said.

This was more than double the bond if it had been set at four weeks' rent.

Erin added: "You wonder why we have a rental f**king crisis hun, woah."

There is now a political campaign to change the law around bonds in Queensland.

Mercorella said: "The $700 threshold was set many years ago at a time when weekly rent values were vastly different to those we are seeing in today’s market."

Until that changes however, it's yet another expense keeping renters trapped in a highly exploitative market.