NSW Passes Historic Rental Reforms: What it Means for Renters and Landlords

Posted on 25 Oct 2024

The Minns Labor Government in New South Wales has passed the Residential Tenancies Amendment Bill 2024, marking one of the most extensive updates to rental legislation in over a decade. The legislation aims to address long-standing issues in the rental sector, including no-grounds evictions, frequency of rent increases, and additional fees. This reform is aligned with commitments made during the recent state election, aiming to establish clearer standards for both renters and property owners in NSW.

Key Changes Impacting Renters

Under the new legislation, NSW renters will experience a series of updates affecting rental processes and costs:

Ban on No-Grounds Evictions: This adjustment prohibits landlords from terminating leases without providing a specified reason, standardizing grounds for eviction to enhance renters’ housing stability.
One Rent Increase Per Year: The legislation caps rent increases to once per year, eliminating existing provisions that allowed multiple increases within a 12-month period if lease types changed.
Process for Pet Ownership: Renters seeking to have pets in rental properties may now apply with specific criteria for approval or rejection, allowing tenants and landlords a clear structure for pet requests.
Fee-Free Rent Payment Methods: The new regulations require property managers to offer cost-free payment options, such as bank transfers or Commonwealth Centrepay, eliminating additional fees associated with certain payment methods.
Background Check Fees: Renters will no longer be required to pay for background checks, thereby reducing the upfront costs associated with rental applications.

Certain aspects of the legislation, including the ban on no-grounds evictions and pet accommodations, will be implemented following amendments to the Residential Tenancies Regulation 2019, set to take effect in early 2025.

Initiatives Supporting the New Reforms

In addition to the legislative updates, the NSW Government has introduced several initiatives to further regulate and support the rental market:

Portable Bond Scheme: With $6.6 million in funding, this scheme will allow renters to transfer their existing bond when moving to a new rental, alleviating financial burdens during transitions.
Rent Check Tool: A new free tool will be available to renters, enabling them to compare requested rent rates with market standards.
Rental Taskforce: Supported by an $8.4 million investment, this taskforce within NSW Fair Trading will address serious violations of rental law, providing enforcement measures to back the new regulations.

NSW Premier Chris Minns described the reforms as a significant adjustment for renters in the state, emphasizing the aim of ensuring a balanced rental environment. Minister for Better Regulation and Fair Trading Anoulack Chanthivong commented that the reforms establish a standardized approach intended to provide both landlords and tenants with predictability and structure in rental agreements.

Following a public consultation that included over 16,000 submissions from renters, industry stakeholders, and tenancy experts, NSW Rental Commissioner Trina Jones noted that the changes address conditions in a rental market characterized by low vacancy rates and rising rental prices.

The new legislation reflects a shift toward structured standards across the rental sector in NSW, with intended effects on security, affordability, and transparency for both renters and property owners.

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