Baltov v Casaceli [2021] NSWCATCD 91

Civil and Administrative Tribunal New South Wales Medium Neutral Citation: Baltov v Casaceli [2021] NSWCATCD 91 Hearing dates: 10 August 2021 Date of orders: 22 September 2021 Decision date: 22 September 2021 Jurisdiction: Consumer and Commercial Division Before: J Alder, General Member Decision: 1 The rent shall not exceed the sum of $1,650 per week as from 01-Oct-2021 to 01-Oct-2022. Catchwords: LEASES AND TENANCIES — Residential Tenancies Act 2010 (NSW) — Rent — Excessive rent — Rent increases Legislation Cited: Residential Tenancies Act 2010 (NSW) Residential Tenancies Regulations 2019 (NSW) Cases Cited: Nil Texts Cited: Nil Category: Principal judgment Parties: Jason Baltov (First Applicant) Renee Baltov (Second Applicant) Ronald Casaceli (Respondent) Representation: Applicants (self-represented) Sydney Cove Property (Respondent) File Number(s): RT 21/27716 Publication restriction: Nil

REASONS FOR DECISION

Application 1. This is an application by Mr and Mrs Baltov (tenant), filed under the Residential Tenancies Act 2010 (RTA) seeking an order pursuant to s 44(1)(a) that a 17% rent increase under an existing tenancy agreement is excessive. 2. It is determined by the Tribunal that the rent increase from $1,500 per week to $1,750 per week is excessive for the following reasons.

Facts 1. The tenancy agreement commenced 3 July 2020 at a rent of $6,517.86 per month/$1,500 per week. 2. The premises are located at Millers Point/The Rocks and were built in 1996. The unit is unfurnished with two bedrooms, a study, two bathroom and two car spaces, being about 164 m2 (including the balcony). The tenant resides there with his wife and two young children. The unit is located 110 metres high in a high rise building, in the front row of units facing the harbour, with impressive views to the Opera House and the Harbour Bridge and beyond to the Blue Mountains and the heads. 3. The unchallenged evidence of the tenant was that the unit appears to have its original fixtures and fittings and has not been refurbished since being built about 25 years previously. The tenant gave unchallenged evidence that the parquetry flooring is lifting up and faded, the stove knobs are broken, bathroom tiles are cracked and the light switches are cracked. 4. On 3 June 2021 the landlord respondent gave the tenant written notice of a rent increase of $250 per week/$1086.30 per month to $1,750 per week/$7,604.16 per month commencing on 3 August 2021, which is about 17%. This is the first rent increase since the tenant occupied the premises, being some 12 months. 5. On 10 June 2021, the tenant offered a 10% increase to $1,650 per week so as to obtain some long term security for his family, but which he thought was "too generous". The offer was declined. 6. The Consumer Price Index (CPI) published on the Reserve Bank of Australia website shows the CPI for June 2020 at -1.9 % and June 2021 at 0.8%. 7. The tenant's evidence of a current rental range for a similar size unit, view and car space was $1,200 to $1,400 per week, with those at the higher range renovated or furnished. 8. The tenant contends that the increase is excessive for the following reasons (in summary). 1. In 2020, rental prices for house and units fell in a number of Sydney suburbs. The rental market in Millers Point fell by 16% in 2020, which was the third biggest price decline in houses nationally. 2. There is an apartment supply glut in Millers Point with 192 apartments for rent. 3. Landlords are having trouble maintaining (let alone increasing) rents due to the Covid pandemic. There is only 50% commercial occupancy in the nearby CBD due to the effects of Covid. 4. The tenant did not ask for a rent reduction during Covid and continued to pay full rent in a timely manner. 5. The landlord erroneously relies on price comparisons for neighbouring three bedroom units, when the tenant's unit is two bedrooms with a study. The study does not have windows and cannot fit a standard single sized bed, so it should not be classified as a bedroom. The marketing material reflects a two bedroom unit. 6. The state of repair and general condition of the premises with its original fixtures and fittings is showing significant signs of wear and tear. 7. Any rent increase for the residential premises should be fair to both parties. 1. The landlord contends that the increase is reasonable. During 2021, the rental market has been improving, albeit slowly. His evidence based on raw data of size/square metres demonstrates that $1,750 per week is the appropriate rent. 2. The landlord's evidence of a current rental range for a similar size unit, view and car space was $1,500 to $2,600 per week, with those at the higher range renovated or bigger and those at the lower range smaller. The landlord has also added an extra $100 to account for the second car space the tenant has.