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How renters can save thousands from 23 March

Woman in pink on colorful square background with australian money
Tenants will have more certainty and protection from March. (Image: Getty)

New residential tenancy rules starting 23 March will see increased "protection and certainty" for tenants in Australia's most populous state.

NSW now has 30 per cent of its population renting, and the expensive purchase prices and decreasing rents in Sydney continue to push that rate upwards.

The headline changes include fixed fees for breaking a fixed-term lease and actually defining what "fit for habitation" means with seven explicit criteria.

Currently a landlord can pursue a lease-breaking tenant for compensation to cover loss of rent, advertising and letting fee. That amount is determined on a case-by-case basis.

The new regime will see a set formula to determine how much penalty a tenant would pay (provided the term is three years or less):

  • Four weeks' rent if less than 25 per cent of the lease had expired

  • Three weeks' rent if 25 to less than 50 per cent of the lease had expired

  • Two weeks' rent if 50 to less than 75 per cent of the lease had expired

  • One week's rent if 75 per cent or more of the lease had expired

Fit for habitation

Incredibly, the landlord's obligation to provide a "fit for habitation" dwelling had never been explicitly defined until now.

From 23 March, according to Fair Trading, that fitness means meeting these seven criteria:

  1. Structurally sound property

  2. Adequate natural or artificial lighting in each room, except storage rooms or garages

  3. Adequate ventilation

  4. Supplied with electricity or gas – and has adequate electricity or gas outlets for lighting, heating and appliances

  5. Adequate plumbing and drainage

  6. Connected to a water supply service or infrastructure for the supply of hot and cold water for drinking, washing and cleaning

  7. Contains bathroom facilities, including toilet and washing facilities, which allow user privacy.

Call for more reforms

The Tenants' Union of NSW executive officer Julie Foreman welcomed the reforms but called for further changes.

"Refinement of provisions for domestic violence victims is a positive step," she said.

"We welcome changes such as clarifying and improving how break fees are charged and creation of standards for premises. Clarification of maintenance of smoke alarms, tenant access fees for database listings being abolished and changes to disclosure requirements for landlords are also improvements."

Foreman said one major item tenants had been requesting still has not been enacted.

"The absence of removal of ability to terminate a tenancy for no reason continues to undermine all other rights of tenants."

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