New tenancy laws in NSW - what Landlord’s need to do?

/ Acumen Property/

The onus is now on NSW landlords to get their property and property management house in order.

From 23 March 2020, significant amendments to the Residential Tenancies Act 2010 (NSW) and the new Residential Tenancies Regulation 2019 (NSW) come into force. Targeting increased protection and certainty for tenants (NSW Department of Fair Trading, 2020a), the once simple process of renting out your property, has evolved into a highly regulated business with inherent complexity, cost and risks.

There are established responsibilities of landlords under common law, to provide habitable premises and civil obligations to disclose known latent defects. The trend towards regulating established good practice sounds reasonable and should help to reduce disputes between landlords and tenants by better clarifying rights and obligations of both parties (NSW Department of Fair Trading, 2020a).  

Landlords and their agents now have more explicit obligations with considerable penalties for non-compliance. While tenants may rejoice, it does mean, renting out a residential property for landlords comes with greater complexity, procedural costs and risks. For investors, the laws of economics may ultimately dictate that higher compensation for these costs and risks in the form of higher rent is required. The alternative for some, may be to remove properties form the rental market altogether.  Agents could find they have to jettison some properties if the property cannot to meet the minimum standards of habitation or if landlord complacency poses an unacceptable economic risk.

To assist landlords, the new tenancy reforms are complimented with requirements for real estate agents to attain higher qualifications (NSW Department of Fair Trading, 2020b). Whilst transitional and grandfathering provisions are in place, agents have time to meet the new minimum standards or be deemed to meet these standards due to experience. Either way, it would be prudent for landlords to pay attention to the new reforms and ensure their property management arrangements meet the new requirements, as the burden of risk has shifted.

For landlords with properties under management with Acumen Property, rest assured that our systems and procedures have been updated and we will be guiding you through the transition.

References

NSW Department of Fair Trading, 2020a. Changes to the residential tenancy laws. [Online]
Available at: https://www.fairtrading.nsw.gov.au/housing-and-property/renting/new-residential-tenancy-laws
[Accessed 13 March 2020].

——— 2020b. Real estate and property industry reforms start on 23 March 2020 - Increased qualification and Continuing Professional Development (CPD) requirements. [Online]
Available at: https://www.fairtrading.nsw.gov.au/housing-and-property/property-professionals/recent-law-reforms
[Accessed 13 March 2020].