Landlord Rights and Obligations (NSW)

Landlord rights and obligations in New South Wales are governed by the Residential Tenancies Act 2010. This article describes the rules for landlords during each stage of a tenancy.

Beginning of tenancy

If the landlord employs a real estate agent, the landlord must ensure the agent is licensed and understands their obligations. The two parties should have a formal agreement in place, governed by the Property and Stock Agents Act 2002.

A landlord must not enter into a residential tenancy agreement unless they have signed an acknowledgement on the agreement that they have read and understood the contents of a “rights and obligations statement”.

A prospective tenant can pay a holding deposit, to reserve the property for 7 days. If a prospective tenant decides to rent the property, the holding deposit becomes a payment towards rent. If they choose not to rent, and notify the landlord within 7 days, the holding deposit must be refunded.

The landlord must take all reasonable steps to ensure there is no legal impediment to the tenant occupying the premises, and that the tenant has vacant possession from the first day of the lease.

The rented property should be vacant, clean and in good repair. All floors should be clean and all rubbish should be removed from the premises.

The premises must be fit to live in. Under the Act, the premises must:

• be structurally sound;
• have adequate natural or artificial light;
• have adequate ventilation;
• be supplied with electricity or gas and have sufficient sockets to use this;
• have adequate plumbing and drainage;
• be connected to a water supply;
• have bathroom facilities that allow privacy for the user.

All locks must work properly and a key supplied for each lock. All appliances and equipment need to function and work as they should.

The premises must comply with any health and safety regulations of the local council, and state and federal governments. This includes having smoke alarms in the premises.

A landlord cannot increase rent before the rental term ends unless they give a tenant at least 60 days’ notice of it. If an agreement is for less than 2 years, rent cannot be increased unless the agreement provides for this, and cannot be increased more than once a year. A tenant can apply to the NSW Civil and Administrative Tribunal (NCAT) for an order that an increase is excessive.

The landlord must pay all charges, levies, premiums, rates and taxes for the property.

If the landlord plans to place the property on the market, they must give the tenant at least 14 days’ notice before it is made available for inspection by prospective buyers. If the property sells, the tenant can stay until the end of the fixed term agreement.

Documents

The tenant must be given:

• a signed copy of the tenancy agreement;
• 2 copies of a signed condition report (if the bond has been paid);
• a copy of any body corporate rules or by-laws;
• the landlord or agent’s name, address and phone number;
• a contact list for emergency repairs.

The landlord or agent must keep a ledger of rent paid.

During tenancy

The tenant is entitled to the quiet enjoyment of the property for the term of the lease, and the landlord must not interfere with the reasonable peace, comfort or privacy of the tenant.

The landlord or agent can enter the property at a time agreed with the tenant, between 8am and 8pm, if the tenant has been given at least 7 days’ written notice, for purposes such as:

• to show the property to a potential buyer or tenant;
• to carry out repairs or maintenance;
• to allow a valuation;
• to take photos or video to advertise the property;
• for a regular inspection permitted under the lease.

The landlord or agent can enter the property at any time without notice:

• if there is an emergency;
• to carry out urgent repairs;
• if they believe the property has been abandoned;
• under an NCAT order.

Repairs are considered urgent in situations such as when there is a gas leak, flooding, or the failure or breakdown of an essential service such as hot water.

A landlord cannot charge for water usage unless the property is individually metered. The full cost of water consumption can be passed on to the tenant if the premises is individually metered or has water delivered, is water-efficient, and the lease states the tenant must pay for water consumption.

End of tenancy

A tenancy ends:

• when a fixed term agreement has ended;
• by mutual agreement;
• when there is a serious unremedied breach of the tenancy agreement;
• when the tenant has abandoned the property;
• when a mortgagee is to take possession of the property;
• when a sole tenant dies;
• when NCAT orders the agreement is ended, for reasons including:
  • a tenant threatening, abusing, intimidating or harassing a landlord or agent;
  • non-payment of rent;
  • a tenant causing damage to property or injury to the landlord, agent or neighbour;
  • the property being used for an illegal purpose.

An exit condition report must be completed by the tenant on or about handover day. The report is compared to the entry condition report to determine whether the condition of the property is different to when the tenant moved in, considering fair wear and tear. If there are no issues, the bond is refunded. If there is disagreement, NCAT can be engaged to resolve the dispute.

For advice or representation in any legal matter, please contact Armstrong Legal.