Initially introduced to Parliament on Tuesday,15 October 2024, the Residential Tenancies Amendment Bill 2024 has received Royal Assent on Thursday, 31 October.
Consequently, the Residential Tenancies Amendment Act 2024 No 75 (NSW) (hereafter, ‘RTAA’) has been enacted to amend the Residential Tenancies Act 2010 No 42 (NSW), with various beneficial consequences for renters.
Key changes include the abolition of ‘no grounds’ evictions, more pet-friendly renting laws, stricter rent increase regulations and bolstered payment protections for tenants.
The Abolition of ‘No Grounds’ Evictions:
Prior to these reforms, landlords possessed the legal capacity to evict tenants at the end of a fixed-term lease or during an ongoing lease without being providing any reason (‘no grounds’ evictions).
However, under the new laws, landlords must now provide a valid legal reason to terminate a tenancy regardless of the agreement type (whether fixed-term or ongoing).
The RTAA has defined ‘reasonable grounds’ for evictions, including:
- Significant renovations/repairs to the property;
- Property demolition;
- The landlord proposing to sell the property; and
- Changes to the property’s use outside of rental purposes.
However, existing grounds including ‘breach by the tenant’ and the ‘sale of the premises necessitating vacant possession’ remain valid.
If a landlord’s ground for termination is deemed not genuine, following Section 86 of the RTAA they may experience substantial penalties of up to $11,000, for an individual, or $71,500 otherwise.
Changes to Rental Laws Regarding Pets:
Under the new reforms, pets may be kept in rental properties with the landlord’s consent, provided the approved consent form is used, although assistance animals may be kept irrespective (per Section 73B of the RTAA).
Significantly, landlords must respond to appropriate consent applications within 21 days of their provision (Section 73D of the RTAA), whereupon they must specify whether consent is given or refused. If a response is not provided, consent will be automatically granted.
The landlord may set ‘reasonable conditions’ upon which consent is contingent, per Section 73E of the RTAA, including end-of-lease professional carpet cleaning, professional fumigation or other conditions reasonable to the type of animal and premises.
Conversely, Section 73F of the RTAA sets out the only grounds for the landlord to refuse consent, including, but not limited to, ‘inappropriate fencing, insufficient open space and the landlord residing at the premises.’
Disputes over consent (including the landlord’s reason for refusing consent) may be brought before the National Civil and Administrative Tribunal (NCAT) following the filing of an application.
Rent Increase Limits and Tenant Payment Protections:
The reforms ensure that rent may now only be increased once every 12 months irrespective of the lease type (whether fixed-term or periodic).
Subsequently, tenants may no longer be charged a fee for background checks or lease preparation.
Significantly, landlords must provide a fee-free and accessible option for rent payment, including options such as bank transfers and Centrepay, to ensure tenants may pay rent without incurring extra charges.
Consequently, these reforms aim to alleviate the financial pressure on renters while increasing the predictability of rent payments.
Please note: Different laws apply to those in living arrangements outside the scope of the Residential Tenancies Act 2010 (NSW) including student accommodations, renters without a formal tenancy agreement and people residing in a boarding house.
If you or someone you know wish to discuss this issue further, then please do not hesitate to contact us on 02 8999 9809.