When you apply for a residential tenancy, you can agree to pay a holding deposit, which gives you an ‘exclusive option’ to enter into the agreement.
The holding deposit includes an “option period” during which time you must notify the lessor or agent whether or not you wish to rent the property. You can only be asked to pay a holding deposit if you have been given a copy of the proposed tenancy agreement.
Holding deposits do not apply to rooming accommodation. When you pay a holding deposit, you must be given a receipt. The receipt should state the agreed “option period”; if this is not stated, it is taken to be 48 hours.
During the option period the lessor or agent must not accept a holding deposit from any other prospective tenant. During the agreed option period, you must notify the lessor or agent whether or not you wish to go ahead with the proposed tenancy.
If you decide to go ahead with the tenancy, the lessor or agent must take all reasonable steps to enter into the agreement, and your holding deposit must be used for rent or bond.
If you decide not to go ahead, your holding deposit must be refunded to you in full, within three days. If the lessor does not refund your deposit, you can apply to the RTA Dispute Resolution Service to recover this money. You will forfeit (lose) your holding deposit if you fail to notify the lessor or agent of your intentions during the option period, or if you agree to the tenancy but then fail to move in.