Improving NSW renting laws — survey guide
Improving NSW renting laws — survey guide
The NSW Government has now opened a consultation on Improving NSW renting laws. Now’s your chance to have your say on the changes needed to make renting fair!
You can have your say through completing the consultation survey, or sending in your renting experience and views as a written submission. We have developed resources to help you contribute in both of these ways. Information about our recommendations is set out below to help you as you are completing the survey; click here for our submission template.
The consultation survey is broken up into 6 sections:
- Reasons for a landlord to end a lease (evictions)
- Pets and renting
- Renters’ personal information
- Portable bond scheme
- Excessive rent increases & rental affordability
- Other issues: embedded networks, free ways to pay rent, and strata schemes
You can choose which sections you want to answer, and skip over others.
Here is our guidance on the issues covered in the consultation survey:
- Reasonable grounds for ending a tenancy
A valid reason for eviction for all renters
All renters should be provided with a valid reason for ending a tenancy.
Landlords should be required to provide a reason to end a rolling (periodic) lease, and a fixed term lease after the end date.
Renters in fixed term leases and those in rolling leases deserve valid reasons for ending a tenancy.
Reasonable grounds for ending a tenancy (fixed or periodic) include:
- The property will be renovated or repaired
- Landlord wants to use property differently and will change use of property (e.g. from a home to a shop or office)
- The property will be demolished
- The landlord will move into the property, or a member of their immediate family will move in
‘The property will soon be sold’ is not a reasonable ground
‘The property will soon be sold’ should not be added as a ground for eviction.
Where the property is sold to an investor, the tenancy should continue. Where the property is sold to an owner occupier, either the existing ground of the property being sold with vacant possession can be used or the new owner can use the proposed ground that the landlord will move into the property.
In other jurisdictions where this is a grounds for eviction, we are aware landlords have used this as a grounds for evicting a renter, and then changed their mind and brought in new tenants. We have even seen renters evicted from their home, made homeless and then move back into the exact same property with the new landlord.
Making sure landlords comply and rules are enforced
Written evidence should be provided to renters when being evicted for all reasonable grounds being considered.
Where the landlord or an immediate family member will be moving in a statutory declaration should be required.
Appropriate compliance protections are required to ensure landlords do not misuse newly introduced ‘reasonable grounds’ for eviction.
This should include stopping the landlord from renting out the property following an eviction for any of the reasonable grounds being considered. The period of time before the landlord can rent the property again should be sufficient to ensure the rule works to prevent landlords misusing newly introduced reasonable grounds.
Providing renters with reasonable notice
Finding a new home for yourself, your family or household can take some time and planning. This is whether you are on a fixed term lease or a periodic (rolling) lease.
Appropriate notice periods may vary depending on the ground provided. For any ‘no fault’ eviction (ie where a renter is not in breach of the agreement) no less than 90 days notice (possibly more) should be given. Some grounds may require a longer notice period (more than 90 days).
Renter able to move out at any time once termination notice served
If you are evicted during a periodic (rolling) lease you are able to move out and stop paying rent at any time before the termination date listed on the notice. This is not the case at the moment for renters on a fixed term lease. They should also be able to move out and stop paying rent before the termination date listed on the notice.
This would help to minimise the costs associated with moving so that a renter is not required to pay double rent once they have secured alternative accommodation.
- A new model for keeping pets
Landlords wishing to refuse permission for a pet
Landlords should always be required to go to Tribunal if refusing a pet request.
The Tribunal should not be able to give the landlord the ongoing right to say no to animals at the property, each pet request should be assessed on its own merits.
There should not be a list of valid reasons for a landlord to say no to a pet. The landlord should go to the Tribunal for all reasons where the tenant does not agree.
Other rules for landlords to accept pets
The landlord should not be allowed to put other conditions on keeping a pet in the property.
Current renting laws already require that any changes made to the property require written notification and consent and must be paid for by the renter (this would include, for example, installing a dog door). Renters already pay bonds to cover potential damage to the property, whether this damage is from a pet or human.
There is also recourse for landlords to recoup any potential costs above the bond amount. It is already a term of the tenancy agreement that a renter abides by applicable strata by-laws.
Other legislation such as the Companion Animals Act already provides rules based on welfare concerns for keeping pets. Renters should not be subject to additional rules that others in the community are not required to follow.
Time for landlords to respond to a pet request
Landlords should be required to respond in a timely manner to a request for a pet. In the ACT, for example, landlords are provided 14 days once a request has been received to respond and must apply to the Tribunal within this time if they are seeking to refuse the request for a pet.
21 days is too much time.
Note: The survey questions on pets don't address issues people with pets face when applying for properties. You might consider making a submission if you would like to raise this issue!
- Renters' personal information
Protections must be put into law
Limits on the information that can be collected must be put into law, including through the introduction of a standard rental application form.
Strong limits on the information that can be collected can help to reduce discrimination against renters when they apply for a property.
Strong protections that provide specific guidance on how renters’ information can be used and shared are required. These should apply not only to real estate agents, but also landlords, and property technology companies.
Renters information should be kept (or stored) securely, and there should be appropriate time limits on how long information about a renter can be kept. Renters should be able to request access to the information a landlord or real estate agent holds about them.
Use of AI or computer programs in the rental application process
While new technology can help streamline the application process for both renters and landlords or their agents, certain protections must be in place to ensure equity and transparency as their use becomes more widespread.
- Renters must be provided with the option to apply with a paper form and paper applications must be accepted and considered equally alongside online applications.
- Any information that can be used to unlawfully discriminate against a renter (renter’s age or suburb) should not be allowed to be used by computer programs for decision making.
- Full transparency regarding how a computer program will make recommendations or decisions about renters’ applications should be required. Information about this should be made publicly available by those relying on the program.
- Portable bond scheme
Moving house can be very expensive for renters. The proposed portable bond scheme will allow renters to directly transfer their bond to another property when they move so they are not out of pocket in the immediate term.
If there is a difference between the bond required, renters should be given flexibility and an appropriate amount of time to pay the difference in bond between properties.
At a minimum this should be 14 days. More time – 30 days, or more than 30 days – would provide renters greater flexibility and help minimise the financial disruption moving often causes.
If a renter is not able to pay the difference on time, the new landlord’s bond should be guaranteed in some way, with the money to be recovered from the renter. The renter should not be barred from the portable bond scheme in future, and landlords should not be able to end the lease.
The portable bond scheme should be optional for renters to use.
- Rent increases
Fair limits on rent increases needed
The current protections for rent increases are not working well
Rents have been increasing sharply for many renters in NSW. The limited protections currently available are not adequate for renters who face an excessive increase during a tenancy.
A landlord should not be able to increase the rent more than once in 12 months for a rolling (periodic) lease and a fixed term lease
At present a landlord cannot increase the rent more than once in 12 months for a rolling (periodic) lease. This is a useful and appropriate, though limited, protection. There should also be a limit introduced to ensure rent cannot be increased more than once in 12 months for those in short fixed term leases (less than 2 years).
For short leases, renters should know about rent increases before they sign an agreement
For short leases, renters should know about rent increases before they sign an agreement. This is an existing and appropriate protection for renters on fixed term leases less than 2 years - the agreement must either specify the increased rent or provide the method of calculating the increase.
There should be protections to prevent a landlord from increasing the rent when changing between lease types
Some landlords are taking advantage of the current loophole in protections to increase rents more than once in a 12 month period by swapping renters between lease types. To help close this loophole, there should be protections to prevent a landlord from increasing the rent when changing between lease types.
Renters do not often feel confident in challenging rent increases that are excessive
It can be hard to know when a rent increase is excessive
Currently the onus is on the renter to challenge a rent increase, and the only basis to do this is if they believe it is excessive. Many renters do not feel confident challenging an excessive rent increase, and they may worry the landlord may retaliate in response.
Landlords should need to show that a rent increase is not excessive
For renters it can be very hard to access and provide the information and evidence required to demonstrate a rent increase is excessive to the Tribunal. This kind of information is more easily available to real estate agents and landlords.
Landlords should be required to justify a rent increase if it is over a reasonable threshold (such as CPI). The onus should be with the landlord to show a rent increase is not excessive.
Other factors must be considered along the market rent when determining whether a rent increase is excessive
A rent increase is excessive if it is well above the previous rent
Currently the failure of the rental housing system - with tight supply and little to no regulation of rents - has resulted in a situation in which market rents for residential properties are not generally in line with what the community considers ‘fair market value’. ‘Fair market value’ is generally considered to be a price both parties are willing to enter into, where both are acting in their own best interests and are free of undue pressure. Rents are being set at a price that the consumer is 'willing to pay', that is - they accept the rent increase and may not move out. But this is only because they feel forced to. They are facing undue pressure given the current housing crisis.
The market sets a self referential value on rents, it pushes rents as far as it is able whatever market conditions prevail - even if those market conditions are causing serious harm. To ensure fairer rents and access to housing market rents should not be relied on as the primary indicator of whether a rent increase is excessive.
- Other changes to improve rental laws
Landlords and agents should be required to tell renters that the property uses an embedded network in rental advertisements.
Free ways to pay rent
The law should require a landlord or real estate agent to also offer an electronic way to pay rent that is free to use.
You can also contribute through sending in a written submission. Click here to see our submission template.