NSW Fair Trading data shows no evidence of rental market disruption from the 2024 tenancy law reforms, with only 30 termination matters found in breach in the first year.
The Property Desk is a contributing writer covering property and public affairs for The Sydney Times.
The NSW Government's tenancy law reforms, which took effect in stages from October 2024, have produced no evidence of negative impact on the rental market after one full year of operation, according to NSW Fair Trading analysis released in July 2026. The report found that active tenancies had risen to nearly one million by March 2026, up 1.1 percent year-on-year, and that bond lodgements and refunds tracked consistent seasonal patterns.
The centrepiece of the reforms, the ban on no-grounds evictions, took effect on 19 May 2025. The amendment to the Residential Tenancies Act 2010 removed the ability of landlords to terminate a periodic tenancy without cause, replacing it with a restricted set of grounds including serious breach, non-payment of rent, and the requirement to return vacant possession for specified circumstances. In the first 12 months of operation, NSW Fair Trading identified only 30 termination matters that appeared to breach the new provisions, with total fines of $65,450 issued against non-compliant landlords and agents.
The second major reform, the Smart Rental Bonds scheme, launched on 10 August 2026 in three pilot local government areas: Parramatta, Penrith, and the Central Coast. The scheme allows renters to pay their bond in monthly instalments rather than as a lump sum, with a $25 application fee and no interest charged on the outstanding balance. NSW Fair Trading estimates the scheme could save renters up to $4,000 per move by reducing the need for multiple bond payments across successive tenancies.
The trial runs for 12 months, after which the Government will assess uptake, default rates, and impact on tenancy commencement times. The scheme is optional for landlords and agents, who retain the right to require a traditional lump-sum bond. Critics have argued that the $25 application fee represents a regressive cost for the lowest-income renters, while tenant advocacy groups have welcomed the flexibility as a meaningful reduction in the upfront cost of renting.
From 31 October 2024, rent increases were capped at once per year for all lease types, ending the practice of bi-annual increases that were common in tight rental markets. The restriction applies to both fixed-term and periodic agreements, and landlords who seek to increase rent more than once in a 12-month period must apply to NCAT for approval. The change has produced a modest decline in the frequency of rent increases, according to NSW Fair Trading, though the overall rate of increase remains driven by market conditions rather than regulatory constraint.
From 21 September 2026, additional protections for tenants experiencing domestic violence came into force. The amendments allow tenants to terminate a tenancy with seven days' notice without financial penalty, provided they supply a signed declaration from a support worker or a domestic violence order. The provisions also prohibit landlords from including clauses in tenancy agreements that penalise tenants for leaving due to domestic violence, and require agents to handle such matters with confidentiality.
NSW Fair Trading established a dedicated Rental Taskforce in 2025 to monitor compliance with the new laws. The taskforce conducted 1,200 random audits of rental properties in its first year, with a focus on bond handling, rent increase frequency, and grounds for termination. The audit program identified 30 instances of non-compliance, resulting in 22 warning letters, six infringement notices, and two prosecutions. The total value of fines issued was $65,450.
The taskforce also received 380 complaints from tenants, of which 290 were resolved through conciliation. The most common complaint categories were bond refund delays, unauthorised entry by landlords or agents, and rent increases that tenants believed were excessive. The taskforce noted that the complaint volume was consistent with historical patterns and that the introduction of the new laws had not triggered a surge in tenancy disputes.
The NSW Government commissioned an independent analysis of the reforms' impact on rental investment activity, published in July 2026. The report, prepared by a team of housing economists at the University of NSW, found no statistically significant change in the rate of landlord exits from the rental market following the introduction of the no-grounds eviction ban. The number of rental properties advertised for sale in Sydney remained within the normal seasonal range, and the rental vacancy rate held at 1.2 percent in June 2026, compared with 1.1 percent in June 2025.
The research also examined whether the reforms had accelerated the shift from long-term leasing to short-term accommodation platforms such as Airbnb. The analysis found no evidence of such a shift, with short-term rental registrations in Sydney remaining flat over the 12-month period. The authors concluded that the reforms had achieved their intended purpose of improving tenant security without unintended consequences for market supply.
The NSW Government has indicated it will review the Smart Rental Bonds trial after 12 months and consider expanding the scheme statewide if uptake and repayment performance meet expectations. The review will also examine whether to extend the no-grounds eviction ban to rooming house and boarding house tenants, a cohort currently excluded from the main reforms. Tenancy advocates are pushing for additional changes, including a mandatory cooling-off period for bond claims and increased penalties for retaliatory evictions.
For the full NSW Fair Trading analysis, see the NSW Rental Market Analysis report. Details of the Residential Tenancies Amendment Act 2024 are available at NSW Legislation. Information about the Smart Rental Bonds trial is published at Smart Rental Bonds NSW.
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