Property management

Requirements when managing property

Before a tenancy agreement is signed, a managing agent must:

• tell the prospective tenant if the property is:
  • planned to be sold – if the landlord has prepared a contract for sale
  • if a mortgagee (i.e. bank or other lender) is taking court action to take possession of the property.
• not encourage the prospective tenant to enter the tenancy agreement if the agent knows of a prescribed material fact about the rental property. It is an offence to knowingly hide a prescribed material fact to induce a tenant to sign a tenancy agreement
• give the prospective tenant the tenant information statement
• if the rental property is in a strata scheme:
  • give a copy of the strata scheme’s by-laws
  • tell the tenant if a strata renewal committee is currently established for the scheme
• ensure that the landlord has read and understood the landlord information statement, and sign an acknowledgment of this on the tenancy agreement.

Before or at the time the tenant signs the tenancy agreement, the managing agent must:

• give the tenant a copy of the tenancy agreement, filled out in the spaces provided
• give two hard copies or one electronic copy of the condition report the landlord or agent has completed for the property
• ensure that the landlord’s name, the landlord’s telephone number or other contact details and the agent’s name, the agent’s telephone number and business address has been provided to the tenant

When the tenant signs the tenancy agreement, the managing agent must give:

• the option to use Rental Bonds Online (RBO) for lodgement of their bond. Visit the RBO page for more information on NSW Fair Trading’s secure online service to manage and refund bond money easily.
• a valid certificate of compliance or valid occupation certificate, issued in the past 3 years, if the property has a swimming or spa pool. This does not apply if the property is in a strata or community scheme with more than 2 lots. Visit the swimming pool page for further information.

After the tenant signs the tenancy agreement, the managing agent must give:

• a copy of the tenancy agreement signed by the landlord and tenant as soon as practicable (if the copy of the tenancy agreement previously given to the tenant was not signed by the landlord).
• Penalties apply if these requirements are not met.

Short term rental accommodation

Some real estate agents manage short-term rental accommodation arrangements for a holiday, business trip or other purpose. Short-term stays last up to 3 months and are not covered by the residential tenancy laws.

When managing short-term rental accommodation, agents must ensure that:

• there is a written agency agreement to ensure proper arrangements are in place for the payment of commissions and costs – see the agency agreements page for more information
• the property owner is aware of the requirements   and has provided clear instructions about the management of the property in the agency agreement
• prospective guests know about any deposit requirements and refund arrangements and procedures
• the property owner provides clear, written instructions about how payments made to the agent are to be disbursed
• money received is paid into the agent’s trust account as soon as practicable
• a trust account receipt is issued to the guest for any money received
• the short-term rental accommodation arrangement does not breach the by-laws of the strata or community scheme where the property is located, and
• you are aware of   the obligations imposed on letting agents under the Code of Conduct for the Short-term Rental Accommodation Industry.

Agents need to remember that payments for a short-term rental accommodation arrangement, including any deposits, are regarded as trust money and must be handled in accordance with the Property and Stock Agents Act 2002.

The Public Health Order affects holiday rentals and holiday homes by imposing limitations on the number of persons who can be on the premises. Short-term rental accommodation providers are required to ensure the maximum number does not exceed 20 persons.

The NSW Government encourages businesses and organisations to complete a COVID-19 Safety Plan where appropriate, even if there is no requirement under the Public Health Order to do so.

Loose-fill asbestos

For real estate agents (in sales, leasing and/or property management) strata managers and auctioneers

A real estate agent acting for the sale, purchase, leasing or management of a property has important obligations in relation to asbestos, which include:

• a duty of care to the client and workers engaged to carry out any work on the property
• a commitment to act honestly, fairly and professionally
• disclosing to prospective buyers and tenants if the property is listed on the register of residential premises that contain loose-fill asbestos insulation. From 23 March 2020 onwards, this is prescribed as a ‘material fact’ under the Property and Stock Agents Regulation 2014. As such, an agent will be committing an offence if they fail to disclose that the property is on the loose-fill asbestos insulation public register.

It is reasonable to assume that properties constructed before 1980 may contain loose-fill asbestos insulation.

What should real estate agents do?

Agents should inform their clients that properties constructed before 1980 may contain loose-fill asbestos insulation.

At the time of conducting their initial inspection, agents should ask their client to complete a questionnaire which includes the following questions:

• What date was the property originally constructed?
• Has the property been renovated since it was originally built? If so, obtain details.
• Is the client aware of the presence of any loose-fill asbestos insulation in the property?
• If yes, the client should specify all locations where they believe loose-fill asbestos insulation is present.
• Has a Licensed Asbestos Assessor inspected the property for loose-fill asbestos insulation? If yes, is a copy of the report available?

If, based on the instructions received from the client, the agent becomes aware of the presence of loose-fill asbestos or suspects that loose-fill asbestos may be present on the property built prior to 1980, the agent should consider practical measures to ensure the health and safety of their workers, clients and others. The agent should take the following steps:

• Request the owner of the premises arrange ceiling testing through a licensed asbestos assessor.
• Request the owner provide any test results to the agent.
• Request the owner informs the residents of the test result.
• If the likelihood of exposure to airborne asbestos fibres is high, the agent should exclude their workers and clients from approaching the site.
• If the owner declines to cooperate, the agent should contact Service NSW on 13 77 88 and seek further guidance.

Agents should also take the following precautions:

• Do not access or direct a person to access the ceiling space or sub floor areas.
• Do not drill or direct a person to drill into walls.
• Provide the owner with information about loose-fill asbestos insulation and recommendation for testing by a Licensed Asbestos Assessor.

Agents should be aware that the existence of loose-fill asbestos is a 'material fact' that needs to be disclosed to any persons considering buying or leasing the affected property. The law has significant penalties for agents who fail to disclose information that could influence decisions on whether to buy, sell or rent a property.

Loose-fill asbestos insulation ('Mr Fluffy')

Throughout the 1960s and 1970s, pure loose-fill asbestos was sold as ceiling insulation for residential and commercial premises.

A Canberra-based company known as 'Mr Fluffy' installed insulation in around 1,000 houses in the ACT and in NSW.

This insulation is particularly problematic because it is raw asbestos which is easy to disturb and fibres can be inhaled.

The NSW Government response to loose-fill asbestos insulation

The NSW Government, under the guidance of the Heads of Asbestos Coordination Authorities, has addressed the issue of loose-fill asbestos in NSW by:

• Receiving updated advice from NSW Health.
• Announcing an independent investigation in August 2014 to establish the number of residential properties with ceiling insulation that may contain loose-fill asbestos material.
• Launching a Voluntary Purchase and Demolition Program  for affected properties and establishing the Loose-Fill Asbestos Insulation Taskforce.
• Establishing a register of residential premises that contain loose-fill asbestos insulation under the Home Building Act 1989.

Further information

Residential tenancy and real estate complaint service

NSW tenants, landlords and agents can use Fair Trading’s tenancy and real estate complaint service for help with tenancy complaints or disputes.

Retail and commercial leases

Visit the Office of the Small Business Commissioner website for information on retail and commercial tenancies.

NBN, fire and lift services

The migration of fixed line and internet services to the NBN network may affect monitored fire alarms and lift phones. Read our overview on how you can assist the migration process for these critical safety services.