Holdover Tenant Laws Australia 2025: Rights, Risks & Financial Impact

Holdover tenants—renters who remain in a property after their lease has expired—are an increasingly common scenario in Australia’s rental market. With rental supply tightening in 2025 and fresh state legislation coming into effect, both landlords and tenants need to understand the rules, risks, and financial implications of a holdover situation.

What Is a Holdover Tenant?

In Australia, a holdover tenant is someone who continues to occupy a property after the fixed-term lease has ended, without signing a new agreement. This can happen for a range of reasons—from delays in finding a new place, to misunderstandings about notice periods, or even strategic choices in a tight market. Legally, this often converts the tenancy to a periodic (month-to-month) arrangement, but the specifics depend on state and territory law.

• NSW & VIC (2025 update): New regulations clarify that once a fixed-term lease expires, tenants automatically become periodic tenants unless a new agreement is signed or proper notice is served.

• QLD: Landlords must provide at least two months’ notice to end a periodic agreement, while tenants need to give two weeks.

• WA & SA: Holdover tenants may face additional fees if they remain without landlord consent, as per recent amendments to Residential Tenancies Acts.

Financial and Legal Implications

The presence of a holdover tenant can have significant financial and legal consequences for both parties. For landlords, the main risks are delays in securing new tenants, potential loss of rental income, or legal costs if eviction is necessary. For tenants, overstaying without agreement can result in:

• Increased rent: Some landlords impose higher periodic rates as a deterrent.

• Legal action: If a landlord issues a termination notice and the tenant refuses to leave, they can apply to the relevant tribunal for eviction.

• Impact on rental history: Being listed on a tenancy database (like TICA) for breaching lease terms can harm future rental prospects.

In 2025, the tightening rental market in cities like Sydney and Melbourne has seen more landlords enforcing holdover penalties, while some tenants use periodic tenancies to retain flexibility in a market with few affordable options.

Best Practices for Landlords and Tenants

With new rules in place and a dynamic rental environment, both sides can take steps to minimise conflict and financial risk:

For landlords:

  - Clearly communicate lease end dates and renewal options well in advance.

  - Document all correspondence and keep records of notice periods served.

  - Familiarise yourself with state-specific rules on holdover penalties and termination procedures for 2025.

For tenants:

  - Understand your rights to periodic tenancy and your obligations for giving notice.

  - If you need to stay past your lease, negotiate with the landlord early to avoid disputes.

  - Be aware that overstaying without agreement can affect your rental record and finances.

With increased focus on rental reform, many states are also rolling out digital tools to streamline notice periods and dispute resolution. For instance, Victoria’s new Online Tenancy Management Portal (launched January 2025) automates reminders for lease expiry and enables e-lodgement of notices, making it easier for both parties to stay compliant.

Case Study: Navigating Holdover in a Tight Market

Consider the case of Emma in Brisbane, who in March 2025 found herself unable to secure a new rental before her fixed-term lease ended. By communicating proactively with her landlord and moving to a periodic tenancy, she avoided penalty fees and maintained a positive rental history, ultimately securing a new lease two months later. Her experience highlights the importance of open dialogue and understanding the updated legal framework.

Whether you’re a landlord or a tenant, being aware of your rights and responsibilities in a holdover situation is crucial in 2025’s competitive rental market. Early planning and clear communication are your best safeguards against unexpected costs or legal headaches.