NSW - New Residential Tenancy Laws
Author: Small Myers Hughes
Date: March,2011
The recent changes (31 January 2011) to the NSW
Residential Tenancies Act 2010
and its associated Regulations contain a comprehensive review of the existing tenancy
laws, including rent arrears, arrangements for rent payments, early termination
by tenants, ‘no‑grounds’ evictions, alterations by tenants, sub-letting, shared
housing, security and tenancy databases.
Below is a brief overview. For a full account of
the new Residential Tenancies Regulation 2010 please go to
NSW Department
of Fair Trading.
Benefit for Landlords
The good news for landlords with the introduction of the new laws is:-
Ø
guaranteed possession once a lease
has ended (if notice to terminate is given correctly);
Ø
an improved faster rental arrears eviction
process;
Ø
the ability to claim accumulated unpaid
water charges from the bond;
Ø
holding fee of up to 1 week’s rent
- if tenant decides not to go ahead they forfeit the entire holding fee.
Disadvantage for Landlords
Ø
The changes have extended
notice periods for tenants to vacate – now 30 days (previously 14 days) at the end
of a fixed term lease, and 90 days (previously 60 days) where the fixed term lease
has expired;
Ø
The tenant
needs only to pay a maximum of 2 weeks rent in advance and 4 weeks rent as a bond
whether the premises is furnished or not;
Ø
Tenants
cannot be charged for the cost of preparing the lease or for the initial supply
of keys and security devices to each tenant named on the lease;
Ø
If there
is a separate water meter and the lease states the tenant is to pay for water usage,
the landlord must ensure the premises has water efficiency measures in place prior
to any new tenant taking possession.
With an existing tenant, the landlord has 12 months from the start of these new
laws to install water efficiency measures.
There are new time limits (3 months) for landlords to seek payment from tenants
on receipt of water bills and the tenant then has 21 days to pay.
What Landlords Now Need to Do
Ø
Landlords will have
to disclose to prospective tenants if there is a sale contract on the property,
or a financial institution has commenced court action, and also any known material
facts about the premises. This includes
such things as violent crime or fires, health or safety issues in the last 5 years.
Ø
The bond must be lodged within 10 days.
Ø
Landlords
or agents
must provide
tenants with a copy of the
New Tenant Checklist before they sign a residential tenancy agreement.
Fines can be imposed if this is not
done.
Ø
The landlord
must now also offer to provide the tenant with at least one means
to pay
rent for which the tenant does not incur a cost (other than bank fees or other account
fees usually payable for the tenant’s transactions) and that is reasonably available
to the tenant. The landlord can pass
on any bank charges incurred for any rent payment dishonoured to the tenant.