NSW Rental Law Reforms: What You Need to Know

In one of the most significant updates to rental legislation in over a decade, the NSW Government has introduced a sweeping set of reforms to make renting fairer, more affordable, and more transparent for both tenants and landlords.

If you are an investor, a tenant, or considering entering the property market, these changes matter. Here is a breakdown of what is changing, why it is important, and what you should be doing now.

What Has Changed in NSW Rental Laws?

The Residential Tenancies Amendment Act 2024 was passed in October last year, with reforms rolled out in two key phases—October 2024 and May 2025. These reforms are aimed at levelling the playing field in the rental market, giving tenants more security while helping landlords navigate clearer, more structured rules.

  • No More Surprise Fees on Rental Applications

From October 2024, landlords and agents are no longer allowed to charge tenants for things like lease preparation or third-party background checks. This makes applying for a rental more affordable and consistent across the board.

  • Rent Increases Limited to Once a Year

It does not matter whether a tenant is on a fixed or periodic lease—rent can now only be increased once every 12 months. This change gives tenants more financial certainty and helps landlords implement fair and predictable rental pricing.

  • “No-Grounds” Evictions Are Gone

As of 19 May 2025, landlords can no longer terminate tenancies without a valid reason. This puts an end to “no-grounds” evictions, which previously left tenants vulnerable to losing their homes with little explanation.

Now, landlords must provide a lawful reason, such as selling the property or needing it for personal use, and adhere to set notice periods—60 days for leases under 6 months, and 90 days for longer leases.

  • Tenants Can Now Request Pets – And Silence Means Yes

One of the most talked-about changes is the new pet rule. Tenants can now formally request to keep a pet. If the landlord does not respond within 21 days, the request is automatically approved. While landlords can still say no, they must now provide a valid reason.

  • Rent Payments Must Include a Fee-Free Option

Renters must be offered a free, accessible way to pay rent—such as bank transfer or BPay. While agents can still offer third-party payment platforms, these cannot be the only method available, nor can they include mandatory processing fees.

Why These Changes Matter

These reforms offer much-needed balance in the rental market. For tenants, it means greater stability, more transparency, and lower upfront costs. For landlords, it means clearer rules and expectations—and better processes to support long-term tenant relationships.

It is no secret the rental market has been under pressure. These changes aim to cool rental inflation, reduce disputes, and make renting a more sustainable option—whether you are living in a property or leasing it out.

In fact, early signs show the impact is already being felt. Since rent increase limits came into effect in October 2024, some areas in Sydney have seen a softening in rental price growth.

What Should Landlords and Investors Do Now?

If you own an investment property in NSW, now is the time to review your rental processes, lease agreements, and tenant communications.

Here are some practical steps:

  • Update your lease templates to reflect the new rules, especially termination clauses and pet policies.
  • Offer fee-free rent payment methods and make sure they are clearly listed in your agreements.
  • Educate your property manager or team about the changes to ensure compliance and avoid penalties.
  • Consider the long-term benefits of stable, happy tenants—reduced vacancy, less turnover, and better relationships.

For Tenants: Know Your Rights

As a renter, these reforms give you more control over your living situation. You are no longer required to pay unnecessary application fees, your rent will not unexpectedly rise multiple times a year, and if you want to keep a pet, you have a clear and enforceable process.

Importantly, you can no longer be asked to leave your home without a valid reason.

Final Thoughts

These reforms are not just policy updates—they are a signal that NSW is moving toward a more mature and balanced rental market. Whether you are leasing out a property or renting one, understanding your rights and responsibilities is now more important than ever.

At Simplify Finance, we believe in empowering our clients—homeowners and investors alike—to make informed, confident decisions. If you would like to chat about how these changes might affect your investment strategy, or if you are planning to enter the property market, we are here to help.

Get in touch today—finance, simplified.

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