As landlords in Western Australia, one of our most important responsibilities is ensuring rental bonds are managed correctly. A rental bond is more than a financial deposit. It is a safeguard that helps us protect our investment while giving tenants confidence that their money is being held securely. The rental bond system in WA is designed to be fair, transparent, and legally enforceable. By following the correct process, we can avoid disputes, ensure compliance with the law, and create professional relationships with our tenants. In this extended guide, we will explain what rental bonds are, the rules you must follow in Western Australia, how to use the online system to lodge bonds, how to handle claims at the end of tenancy, and practical tips for protecting your position as a landlord.
Click To View Our Rental PackagesWhat is a Rental Bond?
A rental bond is a deposit that tenants pay at the beginning of a tenancy. Its purpose is to protect landlords if tenants fail to meet their obligations. Examples include unpaid rent, property damage, or failure to clean the property when they move out. The bond is not extra income for you as a landlord, and it is not money that you can use during the tenancy. Instead, it is securely held by the Bond Administrator until the tenancy ends. If the tenant meets their obligations, they receive their bond back in full. If they do not, you can make a claim for the amount required to cover your losses.
In Western Australia, rental bonds are managed by the Bond Administrator within the Department of Mines, Industry Regulation and Safety (DMIRS). This independent body ensures that bonds are held fairly and securely. This system benefits both parties, giving tenants confidence that their money is safe while protecting landlords by providing a legal framework for making claims if necessary.
Rules for Rental Bonds in WA
The Residential Tenancies Act 1987 outlines the rules for rental bonds in Western Australia. As landlords, we must comply with these requirements. Here are the key points:
1. The maximum rental bond is typically four weeks’ rent. This applies to most properties in WA and is the standard across the state.
2. If the rent is more than $1200 per week, there is no maximum bond. You can negotiate a higher amount with your tenant, but it must still be fair and justifiable.
3. Once you receive the bond, you must lodge it with the Bond Administrator within 14 days. Keeping the bond yourself is illegal and can result in penalties.
4. Both you and your tenant must sign a bond lodgement form, whether submitted online or on paper. This ensures both parties acknowledge the amount lodged.
5. At the end of the tenancy, the bond can only be released when both parties agree on how it should be distributed or when the Magistrates’ Court makes an order if there is a dispute.
By following these rules, you protect yourself against legal issues and show tenants that you are managing the tenancy fairly and professionally.
Lodging Bonds Online
The Bond Administrator provides an online bond lodgement system, which is the most efficient and secure way to lodge bonds. As landlords, we benefit from reduced paperwork, faster processing, and clear confirmation that the bond has been lodged correctly. Tenants also benefit because they can access confirmation of their bond, which builds trust in the rental process.
Here is how the online system works:
– You and your tenant complete a bond lodgement form together.
– You submit the form and payment electronically via the online system.
– The Bond Administrator issues a receipt and holds the bond until the tenancy ends.
– Both you and the tenant have access to records showing the bond has been lodged properly.
To lodge a bond online now, you can use the official system here: Lodge a Rental Bond Online.
Managing the Bond During Tenancy
Once the bond is lodged, it remains with the Bond Administrator for the duration of the tenancy. Neither you nor the tenant can access the funds during this time. The money is held as security, available to be claimed only at the end of the tenancy or with mutual agreement for an earlier adjustment.
During the tenancy, it is your responsibility to keep accurate records. This includes:
– Entry and exit condition reports with photographs.
– Records of rent payments.
– Regular inspection reports.
– Receipts for repairs and maintenance.
These documents are vital if you need to make a claim later. They provide clear evidence to support your case if there is a dispute.
Bond Claims at the End of Tenancy
When the tenancy ends, the bond must be finalised. If the tenant has fulfilled their obligations, the bond is returned to them in full. If not, you can claim part or all of it. The process works like this:
– You and the tenant complete a bond disposal form stating how the bond should be distributed.
– If you both agree, the Bond Administrator releases the funds accordingly.
– If you cannot agree, either party can apply to the Magistrates’ Court. The Court will make a decision based onthe evidence provided by both sides.
This ensures fairness. You cannot simply keep the bond; you must justify your claim with evidence such as photos, invoices, or inspection reports.
Examples of Bond Claims
To give you practical context, here are some common examples of how bonds are used:
– A tenant fails to pay the final two weeks of rent. You can claim that amount from the bond.
– Carpets are heavily stained and require professional cleaning beyond normal wear and tear. You can claim cleaning costs.
– Damage such as broken windows or holes in walls caused by negligence can justify a claim for repair costs.
– The tenant leaves rubbish or garden maintenance undone, requiring removal or professional services. You can claim these costs from the bond.
In each case, your claim must be reasonable and supported by evidence. Ordinary wear and tear cannot be claimed.
Tips for Protecting Your Position as a Landlord
To make sure you are well protected, we recommend the following practices:
1. Always complete detailed condition reports at the beginning and end of each tenancy. Include photographs and clear descriptions.
2. Conduct regular property inspections and communicate with tenants about any issues promptly.
3. Keep written records of rent payments and all correspondence with tenants.
4. Retain receipts and invoices for repairs, maintenance, and professional cleaning.
5. Use the online bond system for security, transparency, and compliance.
Frequently Asked Questions
How much bond can I charge in WA?
You can charge up to four weeks’ rent for most properties. If weekly rent is over $1200, there is no maximum bond.
Who holds the bond?
The Bond Administrator, part of DMIRS, holds all rental bonds in WA. The bond cannot be kept by you directly.
Can I lodge bonds online?
Yes. The Bond Administrator provides a secure online system for bond lodgement. It is the fastest and most reliable method available.
How do I claim the bond?
At the end of the tenancy, you complete a bond disposal form. If the tenant agrees, the bond is released quickly. If not, the Magistrates’ Court decides.
What happens if I do not lodge the bond?
If you fail to lodge the bond within 14 days, you are breaching the law and may face penalties. Tenants can also take action against you.
Final Thoughts
As landlords in Western Australia, rental bonds are one of the most important aspects of tenancy management. By following the rules, lodging bonds through the Bond Administrator, and keeping accurate records, you can protect your investment and remain compliant with the law. The bond system is designed to be transparent and fair, giving tenants confidence and giving you as a landlord a secure way to recover costs if tenants breach their obligations. By using the online system, you can save time, reduce disputes, and manage your tenancies more efficiently. With the right approach, rental bonds are a valuable tool for maintaining a professional, secure, and fair rental arrangement.
