NSW Tenancy Reforms Commencing 23 March 2020

Real Property Manager is focused on providing an improved residential tenancy system. The reform package that was fought for by the community under "cabinet in confidence" will not meet everyone's expectations. These things never do. Tenancy lobbyists consulted the government over the past four years to bring about changes which will affect the way tenancies are created and managed. Following countless meetings and numerous submissions to NSW Fair Trading, the government listened to some, but not all of the lobbying efforts. Rest assured that the final outcome is as balanced as it could have been made thanks to the tireless effort and volunteering of those involved in the consultation process.

Some of the reforms include:

  • Rent increases must be limited to once per year during a periodic agreement when the fixed term has passed.
  • Landlords must obtain tenants’ prior written consent to publish photographs or video recordings of premises, including property interiors for advertising purposes which may show tenants’ possessions.
  • Tenants may make minor alterations, fixtures, additions and renovations with the landlord’s consent, but the landlord cannot unreasonably withhold consent if the alteration, fixture or addition is one from a prescribed list in the 2019 Regulation.
  • Repairs and replacements of hardwired smoke alarms must be carried out by an authorised electrician
  • In an effort to reduce disputes over repairs and maintenance, NSW Fair Trading will have the power to issue rectification orders if tenants require urgent repairs or maintenance.
  • Tenants may give a termination notice if they enter into an agreement by misleading statements that are proven to be concealing certain facts.
  • This will include non disclosure of strata plan sell off due to a developers interest in buying and developing existing strata blocks
  • Non-payment of water usage or utility charges may now result in tenancy termination (in addition to non-payment of rent)
  • Tenants have the right to break their lease if it is signed after 23 March 2020. Tenants will pay a break fee of:
    • 4 weeks rent if less than 25% of the fixed term has expired
    • 3 weeks rent if 25% or more but less than 50% of the fixed term has expired
    • 2 weeks rent if 50% or more but less than 75% of the fixed term has expired
    • 1 week’s rent if 75% or more of the fixed term has expired
  • Victims of domestic violence will be able to terminate their tenancy without penalty

There will be public workshops and seminars throughout 2020 to educate property investors and tenants in getting a better understanding of the practical side of these changes. We will alert you to these as they become available.

For now you can read up about the tenancy changes that are occurring and download the new legislation here.

You can read my previous article about the path of tenancy reforms here.