NSW tenants and landlords may benefit from changes to residential tenancy laws
NSW tenants and landlords need to be aware of the legal implications of new residential tenancy laws which started in March 2020.
The changes are aimed at improving tenants’ rights while also ensuring landlords have better control over managing their properties.
These aims would appear to be at odds with each other, but the changes to the Residential Tenancies Amendment (Review) Act 2018 do set out more clearly the rights and obligations of both tenant and landlord. (Please see also Residential Tenancies Regulation 2019.)
Property must be fit for habitation
Landlords are required to provide rental property that is fit for habitation. The changes set seven minimum standards to clarify the meaning of the term “fit for habitation”.
They include that the property must be structurally sound, provide privacy in the toilet and bathrooms, supply hot and cold water and adequate lighting, ventilation, power and plumbing.
Smoke alarms must be installed and maintained in working order by the landlord.
Under the changes, landlords must meet these standards throughout the tenancy, and undertake repairs as required.
Water use costs can only be passed on to the tenant if they are separately metered. All leaks must be fixed and water efficiency devices installed.
NSW tenants can make minor alterations to property
One of the changes that has the potential to create tension is that NSW tenants are now explicitly entitled to make “minor” alterations to the property, which the landlord cannot refuse if the alteration is reasonable.
Examples of such alterations are childproof latches and gates, fly screens and security cameras; and hooks, nails and screws for hanging pictures and connecting phone lines or computer cables.
There are all sorts of conditions applied to these “minor” alterations, and NSW tenants are still responsible for any damage they cause to the property. When tenants leave, they are still required to leave the property as they found it, except for fair wear and tear.
Increasing rents and breaking fixed-term agreements
Rent increases must be limited to one per year once the fixed term has passed.
In addition, mandatory fees now apply to all fixed-term lease agreements of three years or less, in cases where tenants end the lease agreement early. This applies to agreements that were entered into from 23 March 2020 onwards.
The changes set fees which vary according to what proportion of the lease has expired. For example, the fee is four weeks’ rent if less than a quarter of the lease has run its course.
Changes affect real estate agents and property managers in NSW
The changes to residential tenancy laws also affect real estate agents and property managers.
Property managers must now have separate rental and sales trust accounts. Only the licensee in charge can approve trust account transactions.
NSW tenants living in rented properties with domestic violence
Since 28 February 2019, victims of domestic violence have been able to end their tenancy immediately without penalty. (See Tenancy laws for victims of domestic violence have started, 1 March 2019, NSW Fair Trading.)
Agents are prohibited from listing such a person on a tenancy database and must maintain their privacy.
In July 2020, NSW Fair Trading updated its advice to tenants living in a property where there is domestic violence. (See Domestic violence in a rented property, 23 July 2020.)
Access by NSW tenants to tenancy database information
Information disclosure rules were tightened with the introduction of the new residential tenancy laws. Tenancy database operators cannot charge tenants to access their own personal information and landlords must give tenants copies of strata scheme bylaws.
For more information about residential tenancy laws, please see our recent articles How does coronavirus affect your retail, residential or commercial lease? and “I lost my job and can’t pay my rent!” – Covid-19 creates anxiety for tenants and landlords.