What is a Security Deposit?

What is a Security Deposit?

In Australia, a Security Deposit is a common requirement when renting properties. It serves as a financial guarantee for the landlord or property manager against potential damages or breaches of the rental agreement by the Occupant.

Purpose of a Security Deposit

A Security Deposit, similar to a Bond, is a lump sum payment made by the Occupant to the Landlord or Agent before moving into a rental property. Its primary purpose is to protect the Landlord against financial losses caused by:
  1. Damage to the property beyond normal wear and tear
  2. Unpaid rent, utilities or invoices
  3. Cleaning expenses if the property is not returned in a clean condition
  4. Breach of agreement terms, such as unauthorised pets

Amount and Payment

The amount of the security deposit is typically equivalent to a specified number of weeks' rent (e.g. 4 weeks' rent). It must be paid in full before or upon commencement of the agreement. Payment methods include:
  1. Electronic funds transfer (EFT)
  2. Card (surcharges apply)
  3. Cash (all cash payments will be deposited into our Trust account)

Holding the Security Deposit

Once received, the Security Deposit is held in a regulated statutory Trust account, which is audited on an annual basis by Fair Trading. The Security Deposit will be held until you move out of your property. Your Security Deposit will be processed within 14 days of the stated, agreed departure date.


Security Deposit Processing

Once you have vacated your property, your Security Deposit will be refunded in full providing that:
  1. The property is returned in the same condition as at the start of your agreement, except for fair wear and tear.
  2. All rent, utility and invoice payments (if applicable) are up to date.
  3. There are no breaches of your agreement or outstanding obligations.


Dispute Resolution

If there is a disagreement regarding the refund of your Security Deposit, each state and territory has specific dispute resolution processes through the relevant tenancy authority. This process ensures fair treatment and resolution of disputes.

Importance of Documentation

It is essential that you complete the ingoing condition report sent by ShareSorted upon moving in, as this documentation serves as critical evidence in any disputes regarding the property's condition at the end of the tenancy.


For more detailed information or specific inquiries regarding security deposits in your state or territory, please consult your local tenancy authority or contact our customer support team.