Property Management - Preventing Bond Disputes

Property Management

By Jonathan Clover


Almost every tenant has paid their bond with the full expectation that ‘nothing will happen’ and they’ll get all of their money refunded when they vacate the property.

This is not always the case, however, and tenants are sometimes left perplexed as to why their bond or a portion of it was retained. Knowing your rights and understanding your obligations under a lease is extremely important for exactly this reason.

Take responsibility for the condition report


The first and most important step in any lease is to review your condition report accurately and diligently when you first move into the property. In the case of a dispute arising – especially if a different property manager (who may be more meticulous that the previous one was) does the departure inspection – you can simply refer back to the condition report to determine whether the issue was there prior to your tenancy or not. To really reinforce the importance of a condition report, let’s go over the basics.


For those new to the rental property market, a bond is a fixed amount of money – usually the equivalent of 4 to 6 weeks rent – that is paid to a specific authority (it varies from state to state) to cover any damage to the property while you live there. Damage attributed to you will be defined by the difference between the ingoing condition report, which is approved by both the property manager and the yourself, and the outgoing condition report when you vacate.


When you are given the keys to a property, you will be given a ‘condition report’ that documents all rooms, fittings and fixtures in the property and their existing condition, as of the date you were given the keys. It’s the tenant’s responsibility to review the report, confirm they agree with the property manager’s assessment, and make notes if there is something you disagree with. Most condition reports will have photos that accompany the report, which you should also review and submit your own if the photos in question do not represent the reality. An example might be a wide shot of a bedroom wall and a note in the report stating ‘walls in good condition’; your note in response might be ‘large black scuff mark on lower section of bedroom wall’ which you would then also supply a photo of.


It’s really important to take the condition report seriously, not only because it’s the thing that will determine what will happen to your bond when you vacate, but also because it may come down to ‘your word’ against that which was recorded at the beginning of your tenancy – especially if your property manager changes during your tenancy.


Rental property managers see hundreds of properties every year and though it’s their job to document things precisely, brevity can take priority sometimes and for a tenant waiting on their bond to be refunded, the devil is in the detail. That scuff mark could turn into a dispute over whether the wall needs to be repainted or not, which could mean your whole bond would be retained to cover the costs of the painter - all because neither you, nor the property manager at the time, paid enough attention to the condition report.