New Residential Tenancy Laws

The NSW Parliament has passed the Residential Tenancies Amendment (Review) Bill 2018.

Parliament has passed a series of amendments to the Residential Tenancies Act 2010, which are designed to increase protection and certainty for renters, while ensuring that landlords can protect their investment and effectively manage their properties.

With more than 30 percent of the NSW population now renting, the amendments are both timely and critical as demand for quality rental properties continues to grow.

What are the reforms?

The reforms further improve protections for victims of domestic violence, and improve tenants’ renting experience by making it easier for tenants to make a rental property a home and reducing disputes over repairs and maintenance.

Protections for domestic violence victims

Tenants who need to escape a violent partner will be able to terminate their tenancy immediately and without penalty in circumstances of domestic violence.

Tenants who are victims or a co-tenant who is not the perpetrator will not be held accountable for property damage that occurred during a domestic violence incident.

Landlords and their agents will also be prohibited from listing a victim of domestic violence on a tenancy database if they terminated their tenancy in circumstances of domestic violence.

Minimum standards

Rented properties will have to meet 7 minimum standards at the start of a tenancy to be fit for habitation. These are baseline standards and are not an exhaustive list of whether a property is fit for habitation.

These are:

1. Structurally sound property
2. Adequate natural or artificial lighting in each room, except storage rooms or garages
3. Adequate ventilation
4. Supplied with electricity or gas and have adequate electricity or gas outlets for lighting, heating and appliances
5. Adequate plumbing and drainage
6. Connected to a water supply service or infrastructure for the supply of hot and cold water for drinking, washing and cleaning
7. Contains bathroom facilities, including toilet and washing facilities, which allows user privacy.

These standards must be maintained throughout the tenancy (by way of repairs).

Rectification orders

NSW Fair Trading will have new powers to resolve disputes between tenants and landlords over repairs and maintenance and property damage caused by tenants. This will include the ability to issue rectification orders.

Rent increases

The reforms will help reduce tenants’ fear of retaliatory rent increases by limiting them to once every 12 months for periodic leases.

Other changes

• introducing mandatory set fees for breaking a fixed-term lease early. The break fee will apply to all new fixed-term leases that are 3 years or less that are entered into after the new laws start. The break fees are:
  • 4 weeks’ rent if 75% or more of the lease remains
  • 3 weeks’ rent if between 50% and 75% of the lease remains
  • 2 weeks’ rent if between 25% and 50% of the lease remains
  • 1 week’s rent if 25% or less of the lease remains
• making it easier for tenants to get repair orders from the NSW Civil and Administrative Tribunal
• providing  that only landlords can carry out repairs to smoke alarms, except for certain kinds of smoke alarms and repairs. A penalty will apply for landlords who fail to repair a smoke alarm
• a new definition for separately metered premises to reduce disputes between tenants and landlords about who pays for electricity, gas or water usage charges
• clarifying the rules around taking photos and videos during inspections and publishing them to advertise the property for sale or re-lease, especially where the tenant’s possessions are visible
• stopping tenancy database operators from charging tenants to access their own personal information held on the database
• introducing a penalty to the landlord or agent if they do not provide a tenant with a property condition report at the start of the tenancy.

When will the new laws start?

The Government will consult widely with all affected stakeholders and the community during the development of the regulations, including an appropriate start date for the reforms.

The start date will consider the time landlords, tenants and agents need to comply with the new requirements.

Source: NSW Fair Trading