The NSW Office of Fair Trading has announced sweeping changes to the Residential Tenancies Amendment (Review) Act 2018 [NSW] and the Residential Tenancies Regulation 2019 [NSW] which iwll come into effect on 23 March 2020.

REINSW CEO Tim McKibbin told WILLIAMS MEDIA that the changes are significant and will affect property managers, landlords and tenants alike.

"We are not sure of what the impact will be but with these laws will provide tenants with added legal rights at the expense of landlords," said Mr McKibbin.

"The concern is for tenants, if investors go elsewhere with their investment dollars, we already have a shortage in NSW of rental properties and as a consequence rent is very high.

"The landlord is an investor and they expect their asset to not get damaged, they expect capital growth and they expect an annual return."

Mr McKibbin said there hadn't been enough thought into some of the changes to be introduced, including the definition of minor alterations.

"There are certain things tenants can do with minor alternations but this needs to be tested," said Mr McKibbin.

"Not enough thought has been given to strata arrangements, which are predominantly rentals."

Mr McKibbin said body corporates needed to be included in decisions when a tenant may want to put a picture up in a common wall.

"We are interested in having a good relationship between our members who represent landlords, landlords and tenants," said Mr McKibbin.

"We don't want to see investors go elsewhere when we need them."

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
• 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

More details on the changes can be found here.

Changes to the laws that govern agents in the real estate and property industry in NSW will also start on 23 March 2020.

Agents working in the industry must understand how these apply to them, before the new laws start.

The changes include:

• Restructured licensing system
• Restricted functions for different licences
• Appointing a single licensee in charge for the entire business
• Increased qualification and Continuing Professional Development (CPD) requirements
• Disclosing specific prescribed material facts
• Extended rules of conduct

You can find out more regarding the changes for real estate agents here

Similar to this:

• Changes on November 1 to Residential Tenancies Act are cause for concern, according to REIACT
• REINSW responds to recommendations for changes to Residential Tenancy Act
• New Victorian rental laws "will result in an unfair, unworkable and impractical system" says CEO of REIV