If there is only going to be one tenant on a lease, it is important to first note that any additional tenants or occupants must first be approved by the lessor in accordance with Clause 72(3) of the Standard Residential Tenancy Terms or the Residential Tenancies Act 1997.
If approved, and there is only one person on a residential tenancy agreement, it’s up to him or her to ensure rent is paid on time and in full. Unfortunately, this is often a point of contention as head tenants don’t set clear expectations around money with their flatmates.
With a firm, proactive approach, however, most issues around rent and utilities can be avoided. Here’s how to go about it.
Have a documented plan for rent and utilities
Before sub-tenants move in, make sure you’re completely transparent about any money handling, including bond, rent payments, utilities and other fees.
A face to face conversation is often most effective, but you should also draft a written occupancy agreement for both parties to sign.
Occupancy agreements often set expectations around house rules, notice to leave, eviction and other areas, as well as rent and fees. An occupancy agreement offers protection for tenants and sub-tenants if one party fails to meet the expectations outlined in the document.
What information should be included in an occupancy agreement?
In terms of rent and fees, an occupancy agreement should describe:
- Rental rate;
- When rent is to be paid;
- How rent should be paid (ie. a bank transfer);
- Utilities contributions expected from sub-tenants;
- How long sub-tenant will be responsible for rent if he or she moves out.
Every household will handle money differently. For example, some might prefer to pay all utilities from one account whereas other households opt to have every member responsible for a single bill.
Whatever you decide to do, however, it’s important to make sure you document your plans and make sure everyone is one the same page.