Tenancy reforms to spark surge in rental disputes, warns REINSW
Ahead of upcoming rental reforms in NSW, the state’s peak body has called for a major increase in funding and resources to prepare for the coming “onslaught” of rental disputes.
Upcoming changes to the Residential Tenancies Amendment Act 2024 will mean that NSW property owners, starting from 19 May 2025, will not be permitted to evict tenants or deny pets in their properties without a valid reason.
CEO of the Real Estate Institute of NSW, Tim McKibbin, has now called on the government to increase funding of the NSW Civil and Administrative Tribunal (NCAT) due to the “inevitable spike in disputes” that the new rental reforms will create.
“The NSW government has knowingly and willingly introduced reforms which will cause many more disputes to arise,” McKibbin said.
“Now the damage is done, a major increase in funding and resources is urgently needed for NCAT to prepare for the coming onslaught of disputes,” he added.
McKibbin said the recent slate of rental reforms in Victoria, which came into effect last month, provided a “clear precedent” for what tenants and landlords in NSW could expect in May, when the state’s reforms go live.
Following the introduction of similar tenancy reforms in Victoria, which also banned no-fault evictions, McKibbin said that the Victorian Civil and Administrative Tribunal (VCAT) faced a significantly increased case load.
“We know from direct, recent experience that restricting property owners’ rights, such as restricting their rights to recover possession of their property and say no to pets, leads to a major increase in disputes between tenants and landlords,” he said.
McKibbin said that the expanded backlog of tenancy disputes in Victoria had necessitated the creation of the VCAT Backlog Recovery Program, to counter the residential tenancies list backlog disputes which almost all involved bond, compensation, and pet issues.
“The backlog, which initially comprised ‘approximately 21,500’ cases, saw Victorian residential tenancy dispute median wait times peak at 42 weeks in July 2023,” he explained.
McKibbin said the peak body is anticipating a similar onslaught of disputes in NSW following the new tenancy reforms, which would ultimately overwhelm the NCAT.
“It’s an inevitable consequence of government targeting a specific cohort in the housing market,”
McKibbin said.
“The writing is on the wall for NCAT. The rental reforms will create more disputes and the least the NSW government can do is ensure NCAT has the capacity to deal with them,” McKibbin concluded.