A water leak causing mushrooms and mold to grow through Stephanie Valla’s rental began a two-year court wait that left her and her children homeless, living in a caravan in her friend’s yard.
The issue started in 2020 when water from the bathroom in her rental in south-east Melbourne began leaking into her living room, causing mold to grow throughout the house.
She said when the usual channels of asking her property manager to rectify the issue failed, she sought legal aid and breached the manager through the Victorian Civil and Administrative Tribunal (VCAT).
“I got tired of messaging or emailing [the property manager] and not actually getting a decent reply or anyone coming to look at the house,” she said.
Ms Valla told a receptionist told her the owner intended to sell the house because they could not afford the necessary repairs.
And even if the owners repaired the home, it was up to the court to decide if she could stay while repairs were ongoing.
“I spoke to the legal aid and she said ‘I don’t see why you need to be out. Why would a family, especially a mother with three children, need to be out of the house, especially in this rental crisis when they could be fixing that?’,” Ms Valla said.
A two-year delay due to COVID backlog, exacerbated by a shortage of tribunal members, meant its matter was only finalized in January this year. Despite searching for a new home for six months, she has ended up homeless.
“I had a different member at VCAT [for the final hearing] and she said unfortunately we have too many people staying in the house while works are being done,” Ms Valla said.
Thousands of cases are lodged in the state tribunals and relevant courts every year.
Case delays during the COVID-19 period have seen some states deal with thousands of cases in backlog on top of the new cases, as shown in data provided to the ABC from each state’s relevant court or tribunal.
It has coincided with a spike in the median cost of rentals during the past four years, as data from CoreLogic shows.
Rental advocate Christopher, who asked for his surname not to be used due to legal proceedings he is currently involved with, says this has forced tenants to become more educated about their rights.
Christopher’s role involves liaising with real estate agents on tenant disputes as an advocate for the tenant to help them navigate what can be a complex legal system.
“It’s so naturally accepted that landlords have a natural advocate [in property managers]and I find that disparity, from a procedural view or just from a natural justice point of view, to be a really stark imbalance,” he said.
“You’re dealing with people who are just doing a job as opposed to people who are trying to save their home — so the power imbalance is already huge.”
Since 2020, he has helped a growing number of tenants in Victoria, New South Wales and Queensland with their tenancy disputes.
He says the most common disputes he has been involved in include bond claims, compensation for open houses and unreasonable fees on lease changes.
In Victoria, the backlog of cases and the number of members hearing cases decreasing from 222 to 194 has caused delays in hearings, with the 80th percentile waiting upward of 26 weeks to have their matters finalized according to VCAT’s annual report.
Comparatively, in New South Wales, 73 per cent of non-termination tenancy cases were heard within eight weeks.
New cases are being initiated faster than current cases are being heard, leaving a growing number of people waiting in line each year.
VCAT has appointed 20 new members who started in January this year. They have also given special treatment to bond claims more than two years old to help push through newer bond claims faster.
A VCAT spokesperson said the current caseload numbers between July 1, 2023, and March 12, 2024, had decreased by 48 per cent, with 33,000 new applications submitted in the same period.
The current pending case load is about 17,600 matters.
“This year, with our focus on removing the backlog, overall VCAT has cleared approximately 36,000 matters. VCAT is aiming to manage a caseload rate of 6,000 matters per year,” the spokesperson said.
VCAT president Justice Ted Woodward told ABC Radio Melbourne the tribunal hoped to clear all the older cases by the end of this year.
‘She didn’t break lease, she passed away’
In Canberra, when Hannah Weichard started to have issues with a real estate agent, taking them to the Australian Capital Territory Civil and Administrative Tribunal (ACAT) was a no-brainer. Having previously won a bond dispute in 2014, she had confidence she could win again — but this time it was about honoring her family.
Ms Weichard’s mother-in-law Donna passed away in June 2023 at the apartment she was renting. She said she tried to work with the real estate agent when what she described as “odd things” began to occur.
She said the agent claimed Donna was behind on rent but would not provide a ledger when requested, they contacted a bond cleaner recommended by the agent who charged more than $800 for two hours of cleaning, and was not flexible when arranging an exit inspection.
Finally, when the agent tried to take the entire bond, Ms Weichard immediately claimed against the agent, who sent them straight to court.
“It got very heated because it was so personal for us,” she said.
“We were just so frustrated with the way that they had behaved and they were saying things like, ‘we did this in good faith.’
“She didn’t break the lease. She passed away very unexpectedly. This wasn’t something that she’s done to be difficult.”
She was able to settle the case through mediation and had some of the bond returned in October the same year. To Ms Weichard, she considered this a win.
Cost not always worth it
Solicitor Jessica Townsend has represented multiple people in tenancy disputes in Queensland.
She says while some tenants have become more educated, particularly through social media groups, the court system can still be hard to navigate on your own.
“A lot of people I’ve seen turn up to QCAT, they don’t even know what to do, they don’t have a brief with them, they don’t have evidence,” Ms Townsend said.
“They think that if they go in there and just speak the truth, then you know, they’ll get justice — it doesn’t really work like that.”
She says while most courts have either no fee or a small fee to make a claim, other costs such as hiring a lawyer — which in Australia ranges from $200 to $600 an hour — time and mental toll can deter some tenants from fighting for their rights .
“It’s really difficult because usually the cost of hiring [a lawyer] outweighs any benefit the tenant would get financially, which makes things difficult because we want to help,” she said.
“I think that will change in the future because people now have to pay what would be the equivalent of a mortgage deposit just to obtain a rental because they’re in such demand.”
She said one of the most common issues she had seen in court was landlords trying to claim more than the rental bond.
An example she gave was a glass door needing to be replaced where the quote given by the property manager was double the price of a quote Ms Townsend found for the same door.
“It was a dodgy quote. The extra money went above and beyond what the tenant had in a bond they were trying to sue for extra funds,” she said.
“I think the biggest issue for tenants is landlords creating situations to keep the bond.”
She added that sometimes even when an order is made, they are not always followed through.
“I’ve seen tenants be granted rent reductions for not being able to use certain rooms in the house and the landlord will reduce the rate for a while and then the rent increase will go back up in, say, six months and they haven’t” “t repaired the area.”
Bond claims to blame?
Real Estate Institute of Australia president Leanne Pilkington said a rule allowing tenants to claim their bonds back before the final inspection was to blame for an arise in tribunal cases.
“That means people are claiming the bond to the agent will go through and there’ll be stuff that needs to be done,” Ms Pilkington said.
In the ACAT, bond disputes top the list of types of tenancy disputes followed by terminations/possessions and lessor access to inspection.
When asked about real estate agents attempting to claim beyond properties’ bonds she said it was up to the tribunal to decide.
“I certainly don’t condone agents pushing the envelope. If that’s what they are doing,” she said.
“But often tenants will leave a property without unfortunately, you know, repairing damage or cleaning effectively.”
However, she said she didn’t believe this was a huge problem.
“Real estate agents, the property managers know what the rules are,” she said.
“Property managers don’t want to have to go to court so they know what they are allowed to claim and what they’re not.
“So I don’t see it being a major problem.”
She said ultimately if tenants had ongoing issues with property managers they could complain to Fair Trading, but she believed that any real estate business owner would take action if they had a property manager who continued to lose in court.
Calls for regulation
Ms Pilkington said the problem with the rental market comes down to a supply issue.
“The only thing we can do to improve the situation is to get more supply. We need more properties in the private rental market,” she said.
In the meantime, both Ms Townsend and Christopher are calling for more regulation in the industry to better protect tenants.
“[Real estate] agents are legally obligated to ensure that laws are upheld and I don’t think enough regulation of that industry is done,” Christopher said.
“The amount of agents that plainly disregard law is unbelievable and I think more needs to be done.”
Ms Townsend’s greatest concern lies with what happens when the National Rental Affordability Scheme ends in 2026.
“We’re really just going to have an epidemic of homeless people who are working,” Ms Townsend said.
“It’s already happening now, and it’s just going to get worse.”
