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Recommendations released for updating RTA

11 July 2016

A number of recommendations have been made to improve the Residential Tenancies Act 2010, including allowing domestic violence victims to end their tenancy immediately.

Following public consultation, the NSW Government has released the findings and recommendations from its review of the Residential Tenancies Act 2010 (RTA).

A total of 210 submissions were made on the initial Discussion Paper. REINSW made its submission in January 2016.

Domestic violence

One of the most widely reported recommendations is on the tenancies of victims of domestic violence.

The proposed change will allow victims to end their tenancy immediately by providing evidence of domestic violence through a provisional, interim or final apprehended violence order (AVO), or court order.

A landlord or tenant would be able to apply to the NSW Civil and Administrative Tribunal to resolve a dispute over whether a termination notice with the appropriate evidence was provided.

Further amends around this issue include:

removing the automatic liability of a tenant who is the victim of domestic violence for the damage caused by others who are on the premises
prohibiting landlords and agents from listing a tenant on a tenancy database where they are aware the tenant is a victim of domestic violence.

REINSW President John Cunningham said: “Anything that supports victims of domestic violence has to be supported because we need to ensure the safety of tenants.

“The issues will be about the time is takes to re-let the property and who pays for any damage. We also need to look at the implications and impact it could have on insurance claims.

“However if we have provisions to avoid these issues adversely impacting landlords, then I don’t think there will be any issues from the industry at all.

“Ultimately the devil will be in the detail, but we expect to go into further consultation with the NSW Government to make sure that landlords won’t lose out.”

The new laws are expected to be introduced to Parliament in the first half of 2017 based on the recommendations of the review. The NSW Government says that stakeholders will be consulted, where appropriate, over the drafting of the amendments.

Rights and obligations of landlords and tenants

The review made a number of recommendations for changes, including:

Repairs

The Commissioner for Fair Trading currently issue guidelines suggesting reasonable timeframes for the carrying out of different types of repairs.

The review recommends that the ‘reasonable diligence’ defence is removed on a claim for an order that the landlord carry out specified repairs, and a tenant’s ability to terminate a tenancy on the grounds that the landlord has not carried out repairs.

Instead the Act should provide that NCAT consider the timeframes in the Commissioner’s guidelines, the effect of the failure to carry out repairs, and whether the landlord has acted with reasonable diligence in the circumstances.

Condition report

The condition report provides a page that can contain photos of the property if the tenant or landlord wants to use them.

However, the recommendation is that the landlord/agent must:

consult with the tenant before taking photos to be used in advertising, and provide them with an opportunity to move any possessions that can reasonably be moved
obtain the tenant’s written permission to use photos containing their possessions in advertising
prohibit tenants from unreasonably withholding consent to the use of photos in advertising.

The condition report must be completed by the tenant and provided to the landlord or agent up to seven days after they obtain possession of the rented premises.

Electronic notifications and signatures

Notices can be served electronically by email or other agreed electronic methods (excluding SMS) if the parties agree
The standard form tenancy agreement should allow the parties to opt in to receiving and sending electronic notices
Parties should notify the other of any change to their email address within seven days, and can only opt out of receiving notices electronically by written notice to the other party
The tenancy agreement should include a note stating that section 9 of the Electronic Transactions Act applies to enable the agreement to be approved by electronic means.

Information statements for tenants and landlords

The Tenant’s Checklist includes information about statutory safety requirements relating to smoke alarms, electrical safety switches and child safety window locks.

Landlords must sign a statement that they have obtained, read and understood an information statement which set out their rights and obligations under the Act.

This is to make landlords more aware of their responsibilities, and to help reduce disputes over routine repairs and maintenance.

Rent increases

The requirement to provide 60 days’ written notice of a rent increase be removed because it is unnecessary when the date and amount of the increase is clearly specified in a fixed term tenancy agreement.

Bonds

The payment of interest to tenants on rental bonds is abolished, and the purposes for which Rental Bond Interest Account money can be spent should be widened to include consumer protection more generally.

Landlords and agents must register with Rental Bonds Online and provide tenants with an invitation to use this before the bond lodgement.

Disclosure requirements

A term is to be inserted in the residential tenancy agreement standard form to provide that landlords are to:

disclose matters required under section 26 of the Act. This includes any proposal to sell the premises and persuading a tenant to enter a tenancy by making any false, misleading or deceptive statements
not conceal any material facts set out in clause 7 of the Residential Tenancies Regulation.

This includes the existence of an easement, that the property has been the scene of a serious violent crime within the last five years, or that the premises have been subject to significant health or safety risks not obvious on inspection.

For properties in strata schemes, a landlord must provide the strata by-laws to the tenant before or at the same time that the tenant enters into a tenancy agreement.