The Residential Tenancies Amendment Act 2024 has introduced significant reforms to rental laws in New South Wales. The changes, passed in October 2024, aim to strengthen tenants' rights and improve rental standards across the state.
The main updates focus on:
- Termination notices
- Rent increases
- Pet permissions
These reforms align NSW tenancy laws with those in Victoria, Queensland, South Australia, Tasmania, and the ACT. The changes are expected to take effect in early 2025, pending Governor approval.
Let's break down the key amendments and what they mean for landlords and tenants.
1. Termination Notices: No More 'No Grounds' Evictions
Previously, landlords could issue a 'no grounds' termination notice, allowing them to end a tenancy without stating a reason. Under the new laws, this is no longer permitted.
Valid reasons for ending a tenancy now include:
- Breach of lease – If a tenant fails to meet their obligations (e.g., unpaid rent, property damage).
- Sale of the property – If the home has been sold and the new owner requires vacant possession.
- Owner or family moving in – A landlord (or a close family member) can move into the property, but they must live there for at least six months.
- Extensive renovations or demolition – If major renovations make it impractical for tenants to stay, landlords can terminate the lease.
- End of an affordable housing scheme – If the property was part of a government affordable housing program that has ended.
Stronger Evidence Requirements & Restrictions on Re-Leasing
- Landlords must provide evidence for most termination notices.
- Re-letting restrictions: If a landlord evicts a tenant citing renovations, they cannot re-lease the property for at least six months unless approved by authorities.
- Failure to comply could result in penalties of up to 650 penalty units.
What This Means for Landlords & Tenants
Landlords: Need to be prepared for stricter requirements when terminating tenancies.
Tenants: Have stronger security of tenure, preventing unfair evictions.
2. Rent Increases: Capped at Once Per Year
The new rules cap rent increases to once every 12 months, regardless of whether the tenancy is fixed-term or periodic.
Key changes:
- Rent cannot be raised more than once per year, even if the lease expires and is renewed.
- Applies to all tenancies, whether existing or new.
Impact on Landlords & Tenants
- Landlords: No more mid-lease rent hikes or multiple increases within a year.
- Tenants: Greater predictability and protection from excessive rent rises.
3. Pets in Rental Properties: Landlords Must Provide a Valid Reason for Refusal
Tenants now have a legal right to request permission to keep a pet. Landlords cannot refuse unless they have a valid reason, which must comply with legislated grounds.
New Pet Rules:
- Tenants must submit a formal request to keep a pet.
- Landlords must respond within 21 days.
If a landlord refuses, they must provide valid reasons such as:
- The property is unsuitable for the pet (e.g., no fencing, insufficient space).
- Keeping the pet would breach by-laws (e.g., strata restrictions).
- The pet would cause unreasonable damage beyond the rental bond.
- The landlord lives on the property and has personal objections.
- Landlords cannot increase rent or demand extra bonds because of pets.
What Happens If a Landlord Doesn't Respond?
If no response is given within 21 days, the pet request is automatically approved.
Tenants Can Challenge Refusals
If a tenant believes the refusal is unfair, they can apply to the NSW Civil and Administrative Tribunal (NCAT) for a review.
What This Means for Landlords & Tenants:
- Landlords: Need to provide clear, lawful reasons if rejecting a pet.
- Tenants: Have a stronger ability to keep pets, with a clear process to challenge refusals.
4. Other Notable Changes
Tenants Must Have a Free & Convenient Way to Pay Rent
- Landlords must offer a free and convenient rent payment method (e.g., bank transfer, Centrepay).
- No extra fees for using electronic payments.
Better Transparency for Tenancy Applications
- Tenants cannot be charged for background checks or application processing.
- Landlords must clearly disclose any conditions attached to rental agreements.
Government Monitoring of Evictions
- The NSW Government will now collect data on evictions, tracking the reasons landlords provide for terminating tenancies.
- This aims to prevent misuse of termination laws and ensure tenants aren't unfairly displaced.
When Do These Changes Take Effect?
Most changes are expected to roll out in early 2025, pending official approval.
- Some provisions, like data collection on evictions, will start from July 2025.
- Further guidelines on required evidence for evictions will be published by the NSW Government.
What Should Landlords and Tenants Do Now?
For Landlords
- Review lease agreements and ensure compliance with new termination rules.
- Keep detailed records of any rent increases or eviction notices.
- If considering rejecting a pet, make sure the reason is legally valid and properly documented.
For Tenants
- Be aware of your rights regarding evictions and rent increases.
- If you want to get a pet, submit a formal request and follow the correct process.
- If facing an unfair eviction, seek advice from NSW Fair Trading or a tenancy advocate.
Final Thoughts
The Residential Tenancies Amendment Act 2024 is a game changer for the NSW rental market. While it strengthens tenant protections, it also introduces clear rules for landlords, helping to create a fairer, more transparent rental system.
If you're a property owner, investor, or tenant, it's crucial to understand these new laws and how they impact your rental agreements.
Unlock Your Property's Potential!
If you're seeking expert property management in Newcastle and Lake Macquarie, our dedicated team at Century 21 Newcastle is here to help you maximise your rental returns. For personalised, tailored advice from our investor consultants, click here to book an investment consultation via Calendly.
EMAIL | newcastle.com.au">hello@c21newcastle.com.au
PHONE | 02 4943 6333
ADDRESS | 155 Pacific Highway, Charlestown NSW 2290
SPEAK WITH A INVESTOR CONSULTANT | Click here to book in