Ask LH: What Happens To The Bond When The House I Rent Is Sold?

Dear Lifehacker, We don’t have a lease on the hour we are renting. Our landlord is now going to sell the house that we are in. What happens with the bond once she sells the house? Does she keep it or return it? Thanks, Bond, Claims Bond

Image: Michael Coghlan

Dear BCB,

You’ve stated that you don’t have a lease on the house that you’re renting, but not whether or not you originally had a lease, and that’s quite important when it comes to bond money.

If you did originally sign a legitimate lease that’s now expired, in every Australian state except the Northern Territory, it’s a legal requirement that bonds lodged against rental property go not to the landlord to keep in their own pocket, but instead to the state bond board. As noted, the NT appears to be an exception to this rule.

As such, if you’re not in the NT, then your bond should have gone to the relevant state authority when/if the lease was signed, and there are processes that you can undertake to release your bond money back to you.

However, if you’ve entered into a non-standard leasing agreement and have handed money directly over to your landlord, you should still be entitled to that cash when the property is sold. Remember that a bond is a security deposit against any tenant damage to a property, not a payment of rent upfront. Subject to condition, of course, you should get that money back from your landlord, although your legal avenues depending on how and when you handed the money over do get complicated; you should at the very least have a receipt from them showing when the money was paid and what it was for.

This does open the possibility that you may have to get the bond money back from your old landlord only to hand it over to your new landlord presuming they’re happy to continue having you as a tenant. I’d advise going down the lease route there, however, as amongst other matters it does secure your bond money against a landlord absconding with it.


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