NSW Rental Reforms Passed: Ban on No-Grounds Evictions and Cap on Rent Increases
The peak real estate body in the state has advised caution in imposing overly burdensome conditions on landlords, pointing to the situations in New Zealand and Victoria as examples.
The Minns Labor government in New South Wales has recently implemented a series of rental reforms to enhance housing conditions for tenants.
These reforms include a prohibition on no-grounds evictions, limitations on annual rent increases, and new regulations facilitating pet ownership for tenants.
The legislation also mandates fee-free methods for rent payment and prohibits landlords from charging tenants for background checks during the application process.
The bill was approved by the NSW parliament on Oct. 24.
“Renters in NSW have been overlooked for too long, and that ends now. Prohibiting no-grounds evictions will provide housing stability for renters, enabling them to establish a home,” stated Premier Chris Minns.
No-Grounds Evictions Banned
According to the new laws, landlords are no longer allowed to terminate leases without specifying a reason. This change aims to offer greater long-term security for tenants.
Premier Minns highlighted that the reforms also offer benefits to landlords.
Limits on Increasing Rent
Under the new regulations, rent can only be increased once annually.
Minister for Fair Trading Anoulack Chanthivong emphasized that restricting rent increases to once a year makes renting more affordable and provides tenants with increased financial security.
More Accessible Pet Ownership
The reforms also simplify the process for tenants to have pets in rental properties. Tenants can now request to keep a pet, and landlords can only reject the request based on specific grounds.
Fee-Free Rent Payments
Property owners and agents must now offer tenants fee-free payment options, such as bank transfers and Commonwealth Centrepay, to eliminate hidden costs.
The reforms are part of a broader initiative to ensure renters are not burdened by unnecessary financial pressures.
Ban on Paying for Background Checks
Under the new laws, tenants are no longer required to pay for background checks.
These protections and other reforms will take effect immediately upon receiving royal assent.
The NSW government confirmed that these reforms were the result of extensive discussions with renter advocates and tenancy experts, as well as a public consultation process that received over 16,000 submissions.
Real Estate Body Warns NSW Could Repeat Previous Mistakes
The Real Estate Institute of NSW (REINSW) previously cautioned that the NSW government might repeat the errors of other jurisdictions, such as Victoria and New Zealand, by diminishing landlords’ rights, leading to a deterioration in rental conditions for tenants.
In Victoria, recent data from the Department of Families, Fairness and Housing indicates a significant decrease in rental properties, with nearly 22,000 fewer available this year due to investors leaving in response to new taxes.
Similarly, New Zealand’s 2021 ban on “no grounds” evictions resulted in a drastic reduction in rental supply, prompting the introduction of a new Bill this year to restore landlords’ rights.
REINSW CEO Tim McKibbin stressed that increasing supply is the most effective solution for the rental crisis through new development, eliminating planning delays, and making residential property investment more appealing to investors.
