What is a house share agreement

If you live in a share house you might be a co-renter, a sub-renter or a licensee. There can be confusion about which of these applies to your circumstances.

Work out what rental arrangement you have, especially if you are not on the rental agreement, as not all arrangements fall under Victoria’s rental laws, the Residential Tenancies Act 1997.

Co-renting is the most common type of share-house arrangement. This occurs when 2 or more renters enter into a rental agreement (lease) with the rental provider (landlord), and everyone’s name is on the agreement.

Co-renters who are named on a rental agreement are ‘jointly liable’ under that agreement. This means that if the rental provider suffers loss or damage, and wants to claim money from the renters, they can pursue all of the co-renters for their claim.

The rental agreement is covered by the Residential Tenancies Act 1997, which sets out the rights and responsibilities of renters and rental providers. Any disputes between the renters and the rental provider that they cannot resolve themselves can be decided by the Victorian Civil and Administrative Tribunal (VCAT).

However, the Residential Tenancies Act 1997 does not cover the rights and responsibilities of co-renters in relation to each other. See the heading ‘Disputes between renters’ on this page.

If you are a co-renter, make sure the names of all the renters are on the rental agreement (lease).

If there has been a transfer, such as a renter leaving and being replaced by another renter, the name of the renter who is leaving should be taken off the agreement and replaced with the name of the new renter. This is also known as ‘assignment’.

The rental provider’s written consent, or a VCAT order, is needed before a transfer between renters can occur. You should also make arrangements to transfer the bond. For more information see our page Lease transfers and subletting.

A co-renting agreement does not end until all co-renters leave the premises and return the keys. If you move out of a shared household before the end of an agreement and your name is still on the rental agreement, you will continue to be responsible under that agreement. This could include continuing to be held responsible for the rent, or for any loss or damage that occurs after you leave.

This is one of the most difficult aspects of sharing a household. Renters should make an agreement about how they will deal with these issues at the start of the tenancy. Important issues to agree on include how much notice a renter who wants to leave must give to the other renter/s, how much notice renters should give when they ask a co-renter to leave, and arrangements for transferring the rental agreement and bond.

The Residential Tenancies Act 1997 does not cover co-renters in these situations. See the heading ‘Disputes between renters’ on this page.

For more information on transfers of the agreement and bond see our page Lease transfers and subletting.

If a person is sharing part of a rental property with another person, without a rental agreement with the rental provider, they may be subletting, but not in all circumstances. If they are not subletting, they may not have the renter protections of the Residential Tenancies Act 1997.

Legally speaking, to be a renter who is subletting you must have ‘exclusive possession’ of all or part of the rented property.

Examples of ‘exclusive possession’ include:

• Renting a room in a rental property for your exclusive use
• Renting a separate part of a rental property, such as an outside studio, when you are the only person who accesses and uses that space

If you have ‘exclusive possession’ of a property, or part of it, that you are renting from another renter, who is the ‘head-renter’, rather than from the rental provider, you are a renter under the law. You have all the rights, responsibilities and protections of the Residential Tenancies Act 1997.

Other circumstances that may indicate a subletting arrangement include:

• One renter signed a written rental agreement with the rental provider and the second renter did not
• One renter moved in first, and registered the bond in their name, while the second renter paid their share of the bond to the first renter
• One renter collects the rent from the second renter and pays it to the rental provider
• One renter is responsible for all dealings with the rental provider, such as reporting repairs or giving notices

However, none of these circumstances alone will prove that there is a subletting arrangement, as the legal situation depends on the facts in each individual case.

If you are subletting, disputes between you and the head-renter that cannot be resolved can be decided by VCAT under its Residential Tenancies List.

Consent to sublet

A renter must not sublet all or part of the rented premises without the rental provider’s written consent. Without that consent, the sub-lease is not valid.

However, the rental provider must not unreasonably refuse consent. A renter can apply to VCAT for an order that the premises can be sublet if they believe that the rental provider is being unreasonable in refusing consent. For more information see our page Lease transfers and subletting.

You may be considered to be a ‘licensee’ if you do not have a rental agreement with the rental provider and you are not subletting – you do not have ‘exclusive possession’ of the property you are renting, or part of that property.

If you share a house with the rental provider, the law presumes you are a licensee, unless you can show you are subletting – that you have ‘exclusive possession’ over the part of the property you are renting.

Licensee arrangements are not covered by the Residential Tenancies Act 1997, so you will not have the rights, responsibilities and protections renters usually have under those laws.

Any disputes between you and the person you rent from could be decided by VCAT under the Australian Consumer Law and Fair Trading Act 2012 (Vic) in its Civil Claims List. You would not have the same rights that renters have under the Residential Tenancies Act 1997. 

Shared households need a system for paying rent and bills. Often one person in a shared household will take responsibility for the payments. Problems can arise when that person fails to make a payment after collecting money from others in the house, or other householders fail to pay their share.

If you have paid your share of the rent but someone else has not, the rental provider can start proceedings to have everyone evicted if the rent is more than 14 days overdue. The rental provider will not take action only against the individual who has not paid.

Tenants Victoria is unable to give advice on disputes between co-renters as we do not take sides between renters.

VCAT cannot deal with disputes between co-renters. However, it can decide disputes between sub-renters and head-renters.

Another way of resolving disputes is by mediation through the Dispute Settlement Centre of Victoria. However, all renters in the dispute must agree to go to mediation. Call the Dispute Settlement Centre on 1300 372 888 or visit its website for more information.

If you need legal advice the Federation of Community Legal Centres (FCLC) can refer you to a legal centre in your area. Community legal centres provide free legal advice to people who are eligible to use their services. Not all of them are able to advise on rental matters or disputes between co-renters. Call the FCLC on 9652 1500 or visit its website for more information.