NSW rental law reforms: key changes for landlords and tenants

The Residential Tenancies Amendment Act 2024 and associated Regulation 2025 have now taken effect, marking a significant overhaul of residential tenancy laws in New South Wales. While some changes commenced on 31 October 2024, the majority of reforms commenced earlier this year on 19 May 2025, with enforcement by NSW Fair Trading, including via a newly established Rental Taskforce.

These legislative amendments represent the NSW Government’s stated commitment to increasing stability and transparency in the rental sector, and have implications for existing and future leases. Now that these reforms are in swing, it is a good time to review what the changes mean practically for both Landlords and Tenants.

1. Abolition of ‘no grounds’ termination

Landlords are no longer permitted to terminate tenancies without providing a prescribed ground. Termination must now be supported by one of the specific statutory reasons, including:

• Breach of agreement by the tenant (e.g. unpaid rent, property damage);
• Sale of the property with vacant possession;
• Substantial renovations or demolition;
• Cessation of use as a rental property;
• Landlord or immediate family moving into the premises.

Landlords must issue a termination notice accompanied by a statutory information statement, and in some cases, supporting evidence. Significant penalties apply for false or misleading statements or notices issued without lawful grounds.

2. Statutory re-letting restrictions

In circumstances where a tenancy is terminated for specific reasons (e.g. sale, renovations, occupation by landlord), a re-letting restriction is imposed. This prohibits entering into a new residential tenancy agreement for the premises within a prescribed period (ranging from 4 weeks to 12 months) unless Fair Trading approval is obtained.

3. Rent increase limitation

From 31 October 2024, rent increases are limited to once every 12 months, applying to all lease types, including fixed-term agreements of less than two years. This limit is retrospective, subject to transitional provisions for leases entered into before 13 December 2024.

Exemptions apply for rent adjustments under social housing tenancy agreements where the increase results solely from a change in rent rebate eligibility.

4. Regulation of pet ownership in tenancies

Tenants may now request to keep a pet, and landlords must respond in writing within 21 days, citing a lawful basis for refusal. Valid grounds include the suitability of the property, excessive animal numbers, or conflicts with by-laws or council regulations. Failure to respond results in deemed approval.

Landlords cannot impose higher rent or bond due to pet ownership, and general prohibitions on pets in lease agreements or advertising are no longer enforceable, except in exempt housing (e.g. purpose-built student accommodation).

Consent, once given, endures for the life of the animal even if the managing agent or landlord changes.

5. Prohibition on upfront application fees

From 31 October 2024, it is unlawful to charge tenants or prospective tenants any additional fees at the commencement of a tenancy, including for background checks or the preparation of tenancy agreements.

6. Mandatory bank transfer rent payment option

Landlords and agents are required to provide bank transfer as a rent payment method without charging any associated fees. Tenants cannot be compelled to use third-party payment platforms or specific applications. In the near future, landlords will also be required to offer Centrepay as an option, with implementation details to follow.

7. Extended notice periods for termination

Amended notice periods for landlords now apply:

• Periodic lease: Minimum 90 days;
• Fixed-term lease ≤6 months: 60 days, with termination no earlier than lease expiry;
• Fixed-term lease >6 months: 90 days, also not before lease expiry.

Shorter periods may still apply for termination due to tenant breach or other statutory grounds.

Implications for landlords and agents

These reforms impose new procedural obligations and compliance risks, including documentary requirements, timing restrictions, and enforcement powers for NSW Fair Trading. Landlords and agents should:

• Avoid unlawful conduct in relation to pets, rent increases, or upfront fees.
• Review existing lease templates and tenancy processes;
• Ensure notices and correspondence comply with the amended Act;
• Maintain adequate records and evidence when relying on grounds for termination;
• Avoid unlawful conduct in relation to pets, rent increases, or upfront fees.

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