What’s a Fair Rent Increase in the Current Market?

What’s a Fair Rent Increase in the Current Market?

What is a Fair Rent Increase in the Current Market?

As cost-of-living pressures continue and the property market fluctuates, the topic of rent increases is front of mind for many Victorian landlords and tenants alike. Whether you're a Rental Provider looking to review your rental income, or a tenant trying to make sense of a new notice, understanding what constitutes a fair rent increase is key to maintaining a positive and compliant tenancy.

So, what exactly is considered fair – and how do the current conditions affect that?

📅 How Often Can Rent Be Increased?

Under Victorian rental laws, rent can only be increased once every 12 months for ongoing rental agreements (both fixed-term and periodic), provided it's allowed under the terms of the lease. If a fixed-term lease of less than five years is in place, the lease must specify that rent increases are permitted. For longer fixed-term leases (5+ years), different rules may apply.

Tenants must be given at least 60 days’ written notice before any rent increase takes effect.

💸 What Determines a Fair Rent Increase?

A rent increase should always reflect current market conditions and be reasonable in comparison to similar properties in the area. Several factors can influence what’s considered fair:

  • Market rent comparisons: Check recent listings or rental appraisals for similar properties nearby.

  • Property improvements: Has the property recently been upgraded with new appliances, heating/cooling, or energy efficiency improvements?

  • Demand and vacancy rates: In high-demand suburbs like Frankston, Carrum Downs or Seaford, rents may trend higher due to increased competition.

  • Inflation and economic conditions: Cost-of-living changes and CPI movements may impact expectations.

📊 Current Market Trends in the Frankston Region

In the City of Frankston and surrounding suburbs, we are seeing a mix of stable and upward trends in weekly rents. Despite seasonal slowdowns in winter, rental demand remains strong in coastal suburbs due to lifestyle appeal, proximity to public transport, schools, and beachside amenities.

On average, many properties are seeing increases between $10–$30 per week, depending on location, features, and condition. However, this must still align with fair market value – landlords cannot raise rent simply to match rising interest rates or cover additional costs.

✉️ How Tenants Can Respond to a Rent Increase

If a tenant receives a rent increase and believes it is excessive, they have the right to:

  • Request a rental valuation by Consumer Affairs Victoria

  • Apply to VCAT (within 30 days of the increase notice) to challenge the proposed amount

We always recommend that tenants raise any concerns with their agent first, as many issues can be resolved through open communication.

🤝 Landlord & Tenant Communication is Key

Fairness goes both ways. We encourage Rental Providers to:

  • Be transparent about why an increase is proposed

  • Provide market evidence or a formal rental appraisal

  • Consider the tenant’s payment history and maintenance of the property

And for tenants:

  • Be honest about affordability concerns

  • Understand that some increases are market-driven, not personal

  • Be proactive in raising questions or requesting comparisons

🚫 Rent Increases That May Be Unlawful

A rent increase may be deemed unlawful or unreasonable if:

  • It does not follow the correct notice period (60 days)

  • The amount is significantly above market rate

  • The lease does not allow for an increase

  • It targets a tenant for making a complaint or exercising their rights

It’s always best to seek advice before issuing or challenging a rent increase.

🛎️ Speak to a Local Expert

At Us Real Estate, our Property Management team is committed to balancing the needs of both Rental Providers and tenants. We stay informed of local trends, market data, and compliance changes so you don’t have to navigate it alone.

Whether you're considering a rent review or have received an increase notice and want a second opinion, we’re here to help with honest, experienced advice.

Contact Our Property Management Team:

📞 Tamika Thurgood – 0401 431 484
✉️ [email protected]

📞 Monique Robins – 03 8762 0128
✉️ [email protected]

Let’s make rental living fair, informed, and stress-free – together.