Calculating rent due 

People are often confused about the calculation of rent payments; this is because it is not as straightforward as you might think. Let us help explain, or better still use our handy calculator below!

People are often confused about the calculation of rent payments; this is because it is not as straightforward as you might think.

Agents and landlords may use any number of different methods to calculate their rent, there is no formula set in the legislation.

However, it must be noted that if you pay what you determine is the correct rent and it does not equal what they determine is the full amount, it can be viewed as rent arrears and they can issue a Notice to Remedy and then even a Notice to Vacate. Ultimately if you need clarification, you should arrange an appointment with your agent or Landlord rather than paying a shortfall in order to avoid this reflecting on your rental history.

$200 per week does not equal $800 per month

It is important to remember that while rent may be quoted at the weekly rate in the first instance, the calculation for monthly payments is not simply to multiply by four. This is because the disparity in the length of different months must be considered. Remember, there are not an equal number of days in every month, not exactly 4 weeks in each month and not precisely 52 weeks in a year.

Avoid confusion by establishing how rent is calculated

Below are just some examples of different calculations based on rent advertised at $200 per week.

If a monthly amount is calculated by multiplying the weekly rent by 4 to determine an annual figure, you will multiply the result by 12. This results in 12 x 4 weeks in a year (i.e. only 48 weeks). Based on $200 /week, the result is $800/month and $9,600 per year. This calculation is flawed and cannot be relied on.

At the most simple level, your monthly rent may be calculated in the following way:

Annual rent = Weekly rent x 52

$200 x 52 = $10 400

Monthly rent payment = Annual rent/months per year

$10 400/12 = 866.67

If a tenant makes 12 payments of $866.67, the total rent is $10 400. This is the same as 52 payments of $200.

However, this method does not reflect that there are 52.14, not 52, weeks in a year, and sometimes a tenancy agreement does not run for exactly 52 weeks, depending on the start and end date. (Based on 365 days in a year, 7 days in a week: 365 divided by 7 = 52.14). This figure can be used as a basis for calculations, resulting in slightly different amounts.

As a general rule, the following formulas are used to determine the daily rate based on how rent is quoted or paid (weekly, fortnightly, monthly). Once you have a daily amount, you can determine the other amounts:

Weekly rent payments:

Divide by 7 (eg $200pw ÷ 7 = $28.57per day);

Fortnightly rent payments:

Divide by 14 (eg $400pfn ÷ 14 = $28.57 per day);

Monthly rent payments:

Multiply by 12 and divide by 365 (eg ($867pm x 12) /365 = $28.50per day).

Once you have the daily amount, you can multiply by 365 (or 366 for a leap year) for an annual amount; divide by 12 for monthly rent.

Rent Calculator

If you need to calculate the rent for a defined period, you can calculate it below on our handy rent calculator.