The NSW Government announced this week they would put an end to ‘rent bidding’ – a practice used to drive up rent prices among potential tenants.
It will come into effect in NSW from Saturday.
What is rent bidding?
Rent bidding can happen while a property is being advertised for rent.
In this situation, a property owner or agent would encourage or ask prospective tenants to raise their rent offer to make their application more attractive.
Rent bidding can intensify housing stress, and some say it creates an unfair playing field among prospective tenants.
Prospective tenants in NSW will still be able to offer a higher rent price than what’s advertised, it will just have to be offered “voluntarily” by the tenant.
It’s expected the proposed changes will be sent to the NSW Governor on Friday, who is expected to formalise the new restrictions.
Protections against rent bidding are already in place in Victoria, Queensland, and Tasmania.
Like NSW, some of these states allow prospective tenants to offer more rent than what is advertised, as long as this isn’t initiated by the landlord or agent.
Legislation placing restrictions on rent bidding was tabled in the ACT last month, while a crackdown on the practice is under review in South Australia.