New Rental Rules Shake Up NSW Property Market
Q: What’s happening with rental laws in NSW?
A: New rental laws have just started in NSW. They bring big changes for landlords and real estate agents, and they’re already affecting the rental market.
Q: What are the main changes?
A:
- Landlords must now give a valid reason to end a lease.
- Rent can only go up once a year, even on fixed-term leases.
- Tenants must be given a free way to pay rent (like a bank transfer).
- Tenants can’t be charged for background checks.
- Agents and landlords face big fines for breaking these rules—up to $11,000 per offence, or $71,500 for agencies.
Q: What about pets in rentals?
A: Tenants are now allowed to have up to four pets, and landlords can only refuse based on specific reasons, like no proper fencing or likely property damage. If a landlord doesn’t respond to a pet request within 21 days, the pet is automatically allowed.
Q: Are renters doing anything unusual because of the new pet rules?
A: Yes. Some tenants are offering to give up their right to have pets—this is called “pet bidding.” It’s a way to make their rental application more attractive to landlords who may prefer tenants without animals.
Q: Why are investors leaving the market?
A: Many landlords feel the new rules make it harder and riskier to own rental properties. They’re choosing to sell their properties or move them to holiday rentals instead. This reduces the number of homes available to rent.
Q: Is this a problem?
A: Yes. Less investor interest means fewer rental homes. Vacancy rates are dropping Sydney’s is now just 1.6%, but a healthy market should have 3% to 6%. There are also fewer new investor loans and fewer rental bonds being recorded.
Q: What do experts say about this?
A: Tim McKibbin, head of the Real Estate Institute of NSW, says these new rules may hurt renters in the long run. He believes the government needs to balance tenant rights with investor needs to fix the rental crisis.
Q: Are there any new tools or schemes to help renters?
A: Yes. The government plans to launch:
- A portable bond scheme, so tenants can transfer bonds between properties.
- A "rent check" website to help renters compare rental prices in their area.
Q: What’s the main concern moving forward?
A: The fear is that with fewer investors, rental supply will keep shrinking, making it harder for people to find affordable homes. Experts say reforms should support both renters and landlords to prevent things from getting worse.
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