The NSW Parliament recently passed a number of amendments to the Residential Tenancies Act 2010. With over 30% of the NSW population renting, these changes are designed to make it easier for tenants to make a rental property feel like home.

For landlords, it creates an opportunity to attract and retain high quality, long term tenants – providing greater income certainty on their investments.

The new laws also improve protections for victims of domestic violence.

The implementation date for the Residential Tenancies Amendment (Review) Bill 2018, is expected to begin in the first half of 2020 so it’s important all landlords start planning now.

The Reforms in summary

A. Minimum standards identified

At the beginning of any tenancy, all properties will need to meet 7 minimum standards to be deemed fit for habitation. These standards will also need to be maintained throughout the tenancy (by way of repairs). While not an exhaustive list, these standards are considered the minimum baseline.

The 7 minimum standards are:

1. The property must be structurally sound
2. Each room must have adequate natural or artificial lighting (the exceptions are storage rooms or garages)
3. There must be adequate ventilation throughout the property
4. It must have an electricity and/or gas supply with adequate electricity and gas outlets for lighting, heating and appliances
5. The property must have bathroom facilities (including toilet and bathing facilities) which provide user privacy
6. The property must be connected to water supply infrastructure for the supply of hot and cold water for drinking, washing and cleaning
7. The plumbing and drainage must be satisfactory

B. New resolution powers & rectification orders

The property management industry is plagued by disputes over repairs and maintenance issues along with claims of property damage caused by tenants. The new legislation is designed to reduce these problems by providing NSW Fair Trading with greater powers – including the ability to issue rectification orders.

C. Rent increases limited for periodic leases

Rent increases for periodic leases (that is, where the tenancy has no specified time limit) will be restricted to once every 12 months under the new laws.

D. Protections for victims of domestic violence

Tenants who need to escape a violent partner will be able to terminate their tenancy immediately and without penalty. In addition:

• The victim/s will not be held accountable for any property damage that occurred during a domestic violence incident
• The same is true if they are a co-tenant who is not the perpetrator
• If a tenant terminates a lease because they are a victim of domestic violence, the landlord or their agent are prohibited from adding their name to the tenancy database

E. Separate meters for granny flats etc.

With the rise of dual occupancies, granny flats and the like, the Residential Tenancy Amendments include a new definition for “separately metered premises”. The purpose of this amendment is to reduce the number of disputes between landlords and tenants over who pays for water, electricity and gas.

F. Other changes

The amendments are quite comprehensive and include a number of other changes including:

• The introduction of penalties for landlords or agents if they fail to provide the tenant with a property condition report at the beginning of the tenancy
• Mandatory set fees for breaking a fixed-term lease
• Penalties for landlords who fail to repair smoke alarms
• Clarification on taking photos and videos during inspections and publishing them to advertise the property for re-lease or sale
• Stopping database operators charging tenants to access their own information

Take care of your tenants and they’ll take care of your property

Your investment property is a valuable asset so it’s only natural you want to ensure it’s providing a great return on investment, with tenants that will take care of it.

This new legislation is designed to help you do that by providing tighter guidelines on what’s acceptable from both a landlord’s and tenant’s point of view.

For an informed and conscientious property manager to look after your investment needs, call Brigitte Stills on 1300 091 638 or email propertymanager@stillsproperties.com.au She’s been looking after landlords and their properties for over 30 years.