Laws around rent bidding were strengthened in August 2023 in a move to help alleviate pressure on renters when looking for a new rental property.
At the time the Minister for Fair Trading and Better Regulation Anoulack Chanthivong said, “With a rental crisis in NSW, we need to provide relief as soon as possible. Being an Australian-first reform, we understand there are questions about how a ban on secret rent bidding will be implemented. We can’t let that put a handbrake on areas where there is broad agreement.”
Rent bidding is when an agent or landlord openly encourages or solicits rents higher than the advertised price – whether that’s spoken or written. The practice was outlawed for agents in December 2022 and was recently expanded to include any person such as a landlord or a third-party platform.
“Anyone including a real estate agent, assistant real estate agent, landlord or digital rental application provider, cannot solicit or invite an offer of rent that is higher than the advertised price for a residential rental property,” states the Fair Trading website.
“A landlord or agent must also include a fixed price on advertisements for residential rental properties. They can no longer be advertised within a price range, or with text such as ‘offers from’ or ‘by negotiation’.”
While agents can’t ask for a higher price or advertise a price range, renters are still welcome to make a higher offer than the advertised price. The difference is that agents can’t prompt or suggest the action – it must be offered voluntarily and freely by the renter.
Fair Trading provides a legally-acceptable response if a prospective tenant asks the agent about offering a higher price than what’s advertised.
“Under NSW tenancy laws, agents and landlords are not permitted to solicit or invite a person to offer more than the advertised rent. I encourage you to make your own decision about the value of the property and the rent you wish to pay for it. Applications are judged on multiple factors and rent offered is not the only criteria used when evaluating an application.”
There are fines for those found to be involved in rent bidding. The fine is $550 for an individual or otherwise $1,100. The maximum penalty that a court can award for non-compliance is $5,500 for an individual or $11,000 in any other case.
If you have any questions around the rules and regulations around renting a strata property, please contact your Strata Agent at Netstrata.
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