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Published March 25, 2024

What Is A Rental Bond?

Beyond weekly payments, one of the largest costs associated with renting is likely your rental bond.

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A rental bond, also known as a rental/security deposit, is a refundable deposit that a tenant pays to a real estate agency or landlord. It provides financial protection to the landlord against damage to the property or breaking the terms of the rental contract. 

» MORE: Should you buy or rent a property? 

How does a rental bond work? 

When you move into a rental property, your landlord or property manager will ask you for a bond. In theory, you will get this money back when you move out, as long as you have paid the rent and not damaged the property. 

For the landlord, this money acts as a security. If, for whatever reason, you can’t pay the rent or there is damage, they will deduct this cost from the deposit. In this instance, you may get back a portion of your bond at the end of the lease minus what is deducted. 

When you move into your rental property, you will need to pay this money through an online government website such as Rental Bonds Online in NSW or RTBA in Victoria. The process will vary from state to state, so check where to pay your bond safely. 

Furthermore, your landlord or real estate agent is legally required to provide you with a bond receipt confirming payment. 

🤓 Nerdy Tip

Be cautious of rental property scams — even if you think you’re renting a well-known property. These fraudsters pretend to rent properties so they can ask for bonds in cash, credit card and direct bank transfers. 

» MORE: How exactly do thieves use stolen credit card numbers?

How much is a rental bond? 

A rental bond is usually equal to 2-4 weeks of rent. For example, if the rent for an apartment is $400 per week, the bond may be between $800-$1600. 

However, that’s just a generalisation. Rental bonds vary depending on where you live and the quality of the property. For example, if you move into a very expensive property, the bond will likely increase along with the expected rent. Meaning it may be closer to equally four weeks’ rent than two weeks’. 

It’s also important to note that the bond is calculated based on the entire property, not each tenant. So, if you move into a shared property, the bond is typically split evenly between the tenants. 

When applying to rent a property, it’s essential to factor in the expected cost of the bond, as it is a significant expense when moving. 

» MORE: How much do you need for a deposit on a home loan?

Getting help paying the bond

Freeing up the cash to pay your bond can be a barrier for many renters, particularly when moving from rental to rental if your landlord is holding your previous bond. 

Government and independent initiatives do exist to help you pay your bond, such as: 

There are other initiatives as well. So, be sure to research what is available in your region. 

Rental bond maximums per state

Rental bonds are expensive, but they can’t rise to costly extremes. To keep bonds affordable, landlords must stay within the maximum amount set by the state or territory they operate within. 

Generally, the maximum rental bond in Australia is equal to four weeks’ rent.

However, some states allow exceptions to this rule. Here’s when a rental bond can exceed four weeks’ rent: 

State/TerritoryExceptions for higher rental bond
Australian Capital TerritoryNone.
New South WalesNone.
Northern TerritoryNone.
QueenslandIf weekly rent exceeds $700.
South AustraliaIf weekly rent exceeds $800.
VictoriaIf weekly rent exceeds $900.
Western AustraliaIf weekly rent exceeds $1200.

» MORE: How to handle a rent increase

Tips on getting your bond back

Carefully inspect your rental when you move in

Before you move in your furniture and belongings, inspect the property’s current condition. Note and take pictures of any existing damage, such as broken appliances, stains, or holes in the wall. Consider filming a video walkthrough you can refer to in the future. You can file these digital records with your property manager before you move in. Then, if you find yourself accused of causing damage when you move out, you can use those photos and videos as proof.

Be transparent with your landlord

Communicate with your landlord if you break or damage something or require maintenance, rather than waiting until you move out. 

Pay rent on time

Paying rent on time will prevent you from going into arrears and risk having your landlord deduct the rent from your deposit. 

Give proper notice

Give your landlord notice that you will not be staying if you plan to move at the end of your lease. That way, they have time to advertise the property. 

Thoroughly clean before you leave

When moving out, leave yourself enough time to move your furniture and clean the entire property. You may opt to hire professionals to perform a bond clean, which could improve your chances of getting your entire bond back. 


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