South Australia Holding Deposits
In SA, Holding Deposits are known as Options or Option Fees. The landlord and prospective tenant agree on the amount of the Option Fee and the period the premises is held for. The Option Fee is credited towards the first rent payment when the tenancy starts.
This guide covers landlords (or head-tenants) and tenants (or sub-tenants) in a Residential Tenancy. This applies to the majority of share accommodation and residential property rental situations. To confirm it covers your situation visit What is my share accommodation situation?
What is an Option Fee?
Holding Deposits are known as ‘options’ or ‘option fees’ in South Australia. Paying an Option Fee grants the prospective tenant an option period where the rental premises is held for them while they make a final decision to enter a tenancy agreement.
What is the Option Period and the maximum Option Fee?
The landlord and tenant agree on amount of the Option Fee. There is no maximum Option Fee. However, it is common practice for the Option Fee to be the equivalent of 1-2 weeks rent.
The landlord and prospective tenant can agree on an Option Period of any length.
What happens to the Option Fee?
When the landlord keeps the Option Fee:
- Tenant chooses not to enter the agreement, or
- Tenant chooses to enter the agreement.
If the tenant does enter the agreement, then the landlord must put the Option Fee towards the rent payable under the agreement.
When the tenant is refunded the Option Fee:
- Landlord refuses to enter the agreement with the tenant, or
- Landlord enters an agreement with another tenant.
Transferring money safely
When paying your deposit, bond or rent by cash make sure you get a receipt. With modern phones this can be as simple as an SMS or email confirming the amount, date and what it is for. Keep a copy of this incase you need it later.
Never ever transfer money to a bank account outside of Australia or use a untraceable money transfer system such as WESTERN UNION. If anyone asks you to do this on any website it is likely to be a scam and you are almost guaranteed to lose your money.
If this ever happens on Flatmates.com.au report the member immediately so we can investigate and take the appropriate action.
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These legal guides provide a brief summary and introduction of the laws and regulations affecting share accommodation. They do not cover all cases in all legal jurisdictions and might not apply in your specific share accommodation situation. It is important that you use this information as a guide only and seek independent Legal Advice or consult the Relevant Acts. We do not accept any liability that may arise from the use of this information.