Since 17 December 2022, licensed agents have been prohibited from soliciting rent bidding. From 3 August 2023, any person (such as landlords) are also prohibited from soliciting rent bidding.
On this page
- What are the changes - common questions
- Scenarios on how an agent or landlord should respond to questions from prospective tenants
- Scenarios on rent advertisements
- Scenarios on digital rental application forms
What are the changes?
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.
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'.
Who do the changes apply to?
The changes apply to any person including:
- licensed real estate agents who undertake leasing functions in relation to residential premises,
- landlords, and
- third-party digital rental application providers.
What is the purpose of the changes?
The changes aim to clarify acceptable practices for agents, landlords and third parties and increase transparency as a fixed price will need to be advertised, giving prospective tenants a clear idea of the rent payable and whether they can afford the property.
Can agents or landlords advertise rent as a range?
No – advertisements must include a fixed price.
Can rental advertisements include text like ‘offers from’, 'contact agent', ‘by negotiation’ or 'price available soon'?
No – advertisements must include a fixed price.
Does a fixed price need to be included on signs placed on or near the property?
No - signs used on or near the property which advertise that the property is available for rent are not required to list a price.
Will tenants be prohibited from offering higher rents?
No – prospective tenants are able to offer higher rents for a rental premises if they do it voluntarily and freely.
How should an agent or landlord respond to prospective tenants asking if they should offer a higher rent or asking what other applicants have offered?
Agents or landlords should advise that they are not permitted to solicit or invite a person to offer more than the advertised rent.
Agents or landlords can advise that the tenant should make their own decision about the rent they wish to offer.
What is the fine for non-compliance?
A fine (Penalty Infringement Notice) may be issued - $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.
Scenarios on how an agent or landlord should respond to questions from prospective tenants
Scenario 1
A prospective tenant asks if anyone else has offered more than the advertised price of $650 per week.
The agent or landlord states, "Under NSW residential 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."
The response is clear and specific and complies with the rent bidding laws. By not providing a specific answer to whether there have been higher bids, the agent or landlord has not suggested that the prospective tenant should offer more than the advertised amount.
Scenario 2
A prospective tenant approaches the real estate agent or landlord and asks "Can I offer you $100 above the advertised fixed price for the property?"
The real estate agent responds, "Yes, you can. I will let the landlord know", or the landlord responds, “Yes, you can. I will consider your offer.”
This complies with the rent bidding laws because the prospective tenant offered a higher rent amount without any prompting or suggestion from the agent or landlord. The offer is made voluntarily and freely.
Scenario 3
A prospective tenant asks a real estate agent or landlord, "If I offer more rent, would I have a higher chance of securing the property?"
The agent or landlord responds, "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."
This response complies with the rent bidding laws.
Scenarios on rent advertisements
Scenario 1
A real estate agent or landlord is working with a copywriter to develop an advertisement for a rental property. The copywriter suggests advertising the rent within a price range of $800-$880 per week, or 'open to offers', to draw in better offers.
The agent or landlord responds that this is illegal under NSW's rent bidding laws as properties must be advertised at a fixed price. The copywriter understands and the property is advertised at $850 per week.
This complies with NSW's rent advertisement laws.
Scenario 2
A real estate agent or landlord is offering a property for a 12-month fixed tenancy at $500 per week for the first six months and $550 per week afterward.
The advertisement for the rental property can refer to both amounts as they are both the fixed rent payable for the property. For example, the property could be advertised at ‘$500 per week ($550p/w after 6 months)’.
The price in the advertisement should not appear as a price range.
NSW tenancy laws also require that increases to rental amounts in fixed-term tenancies of under two years must be clearly outlined in the tenancy agreement.
Scenario 3
No applications were received for a property, so the agent or landlord decides to lower the rental price on the advertisement ahead of the next inspection.
The agent, or landlord, changes the advertisement to reflect the lower fixed price. This complies with NSW’s rent advertisement laws.
Scenario 4
The online listing for a rental property includes an icon that says ‘make an application.’
This complies with NSW’s rent bidding laws.
An icon that says ‘make an offer’ would not comply with NSW’s rent bidding laws.
Scenario 5
The online listing for a rental property says ‘$800 per week, deposit taken’.
This complies with NSW’s rent bidding laws.
A fixed price must be included as part of the advertisement. If a fixed price is included in the heading, then other terminology that describes the status of the property can be used.
Scenario 6
The online listing for a rental property says the property is ‘leased’ and does not have an advertised price.
This complies with NSW’s rent bidding laws.
When an advertisement lists a property as ‘leased’, the property is considered to no longer be available for rent and does not need to have an advertised fixed price.
Scenarios on digital rental application forms
Scenario 1
A prospective tenant is completing a digital rental application form. During the process, the application asks ‘do you want to offer more rent than the advertised rent?’
This does not comply with NSW’s rent bidding laws because it is inviting prospective tenants to offer a higher rent price.