Mr ANOULACK CHANTHIVONG (Macquarie Fields—Minister for Better Regulation and Fair Trading, Minister for Industry and Trade, Minister for Innovation, Science and Technology, Minister for Building, and Minister for Corrections) (18:37): In reply: Firstly, I thank all members that contributed to the debate on the Residential Tenancies Amendment (Rental Fairness) Bill 2023: the members representing the electorates of Willoughby, The Entrance, Prospect, Albury, Granville, Newtown, Gosford, Davidson, Mount Druitt, Sydney, Cessnock, Canterbury, South Coast, Kiama and Newcastle. The Government understands the pressures that people are feeling in the renting and housing market at this stage. It understands the financial and emotional pressures that people are feeling in this difficult time.
The Government knows how important renting and housing is and the impact it has on people as they make other big decisions in their lives, like where they work, where they want to live and other personal family decisions. These are very difficult times. That is why this bill is so important, along with other reforms that the Government wants to do in this space. The bill delivers on the Government's election commitment to improve rental laws for the people of New South Wales. It does so by extending the ban on solicited rent bidding to landlords and third parties and supporting the implementation of a portable bond scheme. It is the Government's first step in making systemic changes to the New South Wales rental market to ensure that renters are provided with meaningful protections when looking for a home and to make it easier for them to balance financial burdens as they move from place to place. The ban on solicited rent bidding will align rental laws in New South Wales with those in Victoria, Queensland, Tasmania and the Australian Capital Territory. It will ensure that landlords and third parties, in addition to real estate agents, will not be able to invite tenants to make offers of rent higher than the advertised price for a rental property.
While we have now removed the proposed ban on secret rent bidding from the bill, our Government remains committed to improving transparency. We will charge the incoming Rental Commissioner with the important task of working with stakeholders to look at ways to improve transparency in the market. I am proud that we have moved quickly to introduce the enabling provisions for the Government's portable bond scheme. I have heard firsthand from renters how expensive it is to move between rental properties. The Government wants to make it easier for renters by allowing them to transfer their existing bond to their next property without having two bonds operating concurrently. There is more work to be done to make this a seamless customer experience, and the Government will work closely with industry and community stakeholders to roll out a portable bond scheme that works for renters and owners.
Today's debate has shown the importance of fair rental laws to all members. I respond briefly to the points made. It is easy for Opposition members to criticise the Government for not supporting renters, but they had 12 years to take action and lacked any sense of urgency or focus on making the required changes. This is a very difficult situation that I fairly say is the result of 12 years of inaction. Suddenly the Opposition wants us to care about renters who were ignored for so long. The measure of members' commitment to any reform agenda should be measured by their past actions in government, not their criticisms in opposition. I always respect any argument that can be substantiated by analysis, research and evidence, rather than the parroting of other people's opinions. We should never be comforted by other people's opinions or be discomforted by our own thoughts. The intended postponement of clause 22B is not a broken promise. We have rescheduled our commitment to increasing transparency in the rental market.
I find it odd that the Liberal Party, which always says it believes in better-informed markets and transparency of information that empowers individual decision-making, stands against the very initiatives of clause 22B. Such is its political opportunism over the policy objective. Clause 22B was and is a transparency measure, not a price‑influencing mechanism. It was intended to make an opaque situation in the rental market more transparent. I trust individuals and I give them credit for making decisions that best suit their circumstances. But I acknowledge that delaying other important aspects of the bill because of hypothetical debates about the repercussions of clause 22B is not in renters' interests. Every piece of economic analysis that I have read says that rental prices are influenced by factors like location, number of bedrooms, house type, cost of financing, whether the property is close to schools and jobs, access to transport, and the fundamental factors of supply and demand. We have also noted that since COVID, household size in Australia has reduced and this has created demand for over 100,000 dwellings on existing stock. Supply and demand is what is actually causing a lot of the price pressures in the market.
I am happy to be proven wrong on whether there is economic literature that says that a notification mechanism is more statistically significant than the factors I have outlined. I acknowledge that the economic equation does not always equal the political equation. I do not want to delay important aspects of the bill and, on top of that, go through some haggling process in the upper House. Delay does not suit renters and it does not suit the rental market. The Government will charge the Rental Commissioner with continuing this work in close consultation with advocates and the sector to make the market more transparent. I note the comments from the member for Davidson. It was encouraging to hear the Opposition's support for our other rental reform commitments, and its calls for bipartisanship. I look forward to its support when we introduce our next tranche of legislation to improve fairness in the rental market.
I recognise the calls from the member for Newtown for a complete ban on rent bidding. However, there is a risk that banning properties from being rented above the advertised price may lead to higher initial asking prices. If there is no room for owners or agents to negotiate on rental prices, then some landlords may try to price as high as possible so they can charge an inflated market price, which I think could be well over and above the normal market price. This would not be productive for renters who are already facing increasing rents. The Government wants an approach that allows parties to work together and ensures renters have the information they need to make an informed decision on a rental property that best suits their personal situation. As I have said, the incoming Rental Commissioner will consider the issue of increasing transparency in the rental market. The process for recruiting the commissioner is well underway. I look forward to them being appointed so they can get to work straightaway on the reform agenda that we are beginning to put in place tonight and will continue to action in the coming weeks and months.
We thank the stakeholders and members of the crossbench who have engaged constructively on the bill. This is merely the start of the Government's rental reform agenda. The bill is just the first step in implementing the Government's commitments to improve tenancy laws and make renting fairer. We are already working on the next lot of important reforms, which include our policy commitments to amend laws on no-grounds evictions so that tenancies will not be able to end without a reason, to make it easier for renters to have pets, and to better protect the personal information collected from renters during the application process. I thank the select committee for their constructive engagement on the bill and the recommendations they have made. Our work on the next phase of reforms includes examining options for ways we can improve the tenancy application process so that it both protects renters from unnecessary invasions of privacy and provides real estate agents and landlords with the information they need to make a decision about a rental candidate. A standardised application form will be one of the options considered. The Government will consult with stakeholders on the options to ensure it develops an effective and workable solution.
The Government is aware that there are acute difficulties faced by disadvantaged people when they try to find rental accommodation that is both affordable and appropriate for their needs. The witnesses at the select committee inquiry noted in particular the difficulties faced by people on lower incomes or receiving rental support payments, people with disabilities, older Australians, Aboriginal and Torres Strait Islander people, people displaced by natural disasters and those experiencing homelessness. The Government agrees with the committee's recommendation that further consultation is needed to consider how to address discrimination in the rental application process. This work will fall within the purview of the Rental Commissioner, who has already been tasked with examining current gaps in the law and practices that work to erode renters' rights, including those of marginalised and disadvantaged groups.
We will work closely with industry, tenancy advocates and the public as the next stage of our rental reform agenda takes shape. The State's first Rental Commissioner will drive this important work. We expect to consult on our proposed reforms in the very near future. As I have said, the recruitment process for the commissioner is well underway. The Rental Commissioner will be appointed as a voice for renters and the market. They will work with renters, owners, agents and the community to address longstanding rental issues such as rent increases. The Government looks forward to the conclusion of the recruitment process and will work with the commissioner as soon as he or she is appointed.
The Government is also progressing work separately to design and develop an efficient and customer‑focused portable bond scheme that will allow renters to transfer their bond between properties. We will ensure that the supporting regulations are consistent with the Residential Tenancies Act. We will consult closely with renter advocates, industry and the community to ensure the scheme is workable for all parties and as easy to use as possible. The Opposition claims it would have implemented a portable bond scheme by the end of the year. I must say that is a bit difficult to believe when such a scheme could have been implemented anytime in the past 12 years of its time in government, but it was not.
With the bill, the Government is taking the first steps of many to respond to calls for action from renters who are experiencing the difficult rental market. But we also understand that the best way to address rental affordability is to address rental supply. While placing a ceiling on rents in the short term may appear attractive, rent freezes do nothing to address a lack of housing supply and, in the long run, will worsen supply. The first goal in anything we do is to add no more pressure to what is a tight housing and rental market. We will not implement any rental reforms that will restrict rental housing supply. That is the principle that underpins all our reforms. We must be careful in applying simplified universal rules and assuming that somehow there would be no adverse impact on the rental market or any added pressure on renters. We could end up hurting the very people we are trying to help.
My view is that a rent freeze or rent cap would exacerbate supply problems by reducing the price signals that guide development and investment, right at the time when the community needs more housing to be built; fail to recognise the individual circumstances that apply to a particular property—these are micro transactions between millions of Australians in different situations; reduce incentives for owners to enter the market and to carry out repairs, renovations and upgrades; contribute to higher up-front rents if owners seek to set initial rents as high as possible because they will be unable to increase them later; and have the potential to increase the number of mortgage defaults if mums and dads and other property owners were unable to recoup the cost of their financial commitments. We need to be careful. I believe that the reforms we want to make are responsible, measured and balanced for both property owners and renters. This is not an adversarial situation or relationship we want to have. We want to work with property owners and renters. Renters need good property owners and property owners need good renters. That is a mutually beneficial equation and a balance we want to focus on.
We will be focusing on tackling the State's rental crisis through long-term supply solutions that work. The Minns Labor Government has a comprehensive strategy to deliver more homes for residents of New South Wales, including creating Homes NSW to deliver more social and affordable housing; delivering denser development around key transport hubs such as the Sydney metro; streamlining planning approval processes; abolishing stamp duty for first home buyers buying a home worth up to $800,000 and offering a concessional rate to first home buyers purchasing a property valued between $800,000 and $1 million; creating a building commission to ensure that new homes in New South Wales are of high quality, safe and resilient for owners and renters; and auditing surplus public land that could be rezoned for housing, further increasing the supply and further putting downward pressure on prices.
The bill demonstrates this Government's commitment to rebalancing rental laws so that they better protect renters and support both owners and renters to work constructively. The reforms take New South Wales forward, supporting renters to secure homes. I am proud that this is the first piece of legislation that I have introduced as a Minister, because these changes matter. Creating comprehensive law reform does not just happen; it is the product of the united commitment of industry and community stakeholders working with the Government.
I acknowledge the contributions of all members here today and the stakeholders who worked with the Government to finalise the bill before the House. Again, I particularly thank the select committee for its constructive engagement and input on the bill. I thank members of NSW Fair Trading who supported the development of the bill, including by working closely with our stakeholders. I thank Diana Holy, Jasmin Chin, Cassandra Jacobs, Sabah Fahad, Julia Dabrowski, Melissa Pinto and Katerina Pavlidis for their work on the bill and the Government's work to ensure that rental laws in New South Wales are fair, well balanced and support renters and owners. I commend the bill to the House.
The ASSISTANT SPEAKER (Mr Jason Li): The question is that this bill be now read a second time.
Motion agreed to.
Consideration in detail requested by Mr Anoulack Chanthivong.
Consideration in Detail
The ASSISTANT SPEAKER (Mr Jason Li): By leave: I will deal with the bill in groups of clauses and schedules. The question is that clauses 1 and 2 and schedules 1 to 3 be agreed to.
Mr ANOULACK CHANTHIVONG (Macquarie Fields—Minister for Better Regulation and Fair Trading, Minister for Industry and Trade, Minister for Innovation, Science and Technology, Minister for Building, and Minister for Corrections) (18:55): By leave: I move Government amendments Nos 1 to 6 on sheet c2023-036A in globo:
No. 1Notice about higher offers of rent
Page 3, Schedule 1[1], line 3. Omit "Sections 22A and 22B". Insert instead "Section 22A".
No. 2Notice about higher offers of rent
Page 3, Schedule 1[1], proposed section 22A(2), lines 13—17. Omit all words on the lines. Insert instead—
(2)A person does not contravene subsection (1) merely by placing a sign on or near the residential premises for rent without stating the amount of rent for the premises on the sign.
No. 3Notice about higher offers of rent
Page 3, Schedule 1[1], proposed section 22A(4), lines 24 and 25. Omit all words on the lines.
No. 4Notice about higher offers of rent
Page 3, Schedule 1[1], proposed section 22A(5), lines 28 and 29. Omit "and section 22B".
No. 5Notice about higher offers of rent
Pages 3 and 4, Schedule 1[1], line 30 on page 3 to line 23 on page 4. Omit all words on the lines.
No. 6Notice about higher offers of rent
Page 6, Schedule 3, proposed entry for "Section 22B(2)". Omit the entry.
I thank members of the House for granting leave. The amendments remove proposed section 22B of the bill and makes consequential amendments. Proposed section 22B aims to implement a ban on secret rent bidding and require real estate agents and landlords to notify rental applicants of higher offers of rent made by other acceptable applicants. Being an Australian-first reform, the Government understands why there are questions about the proposed ban on secret rent bidding. This Government has constructively engaged with renter advocates and crossbench members of Parliament and the Opposition on the issue of secret rent bidding, and it will continue to do so. We thank them for their interest in this issue and cooperative approach to the bill.
We remain committed to increasing transparency for renters in the rental application process. But, due to the difficult rental market, we want to accelerate the passage of other practical reforms to ease the pressure on renters wherever possible as fast as we can. We propose to amend the bill to remove the provisions about banning secret rent bidding at this point in time. That will allow us to move forward with other elements of the bill, which will close the existing loopholes relating to solicited rent bidding by extending the ban on such practices to landlords and third parties, support the implementation of a portable bond scheme to alleviate financial pressure on renters who are moving house, empower the incoming rental commissioner to gather pricing data from agents about the rent-bidding reforms so that the commissioner can advocate for renters and provide high-quality advice to the Government, and clarify that rental bonds are held on trust by the New South Wales Rental Bonds Board.
The Government will also charge the rental commissioner with working with renters' advocates and industry to consider how to improve transparency in the rental market. The rental commissioner is in the process of being recruited and will assist in implementing the next stage of our reforms. The bill is only the first step of our big rental reform agenda, and the beginning of the journey to better renting laws in New South Wales. Work is already underway on the next stage of rental reforms, including ending no-grounds evictions, making it easier for renters to have pets, and better protecting renters' personal information. I look forward to continuing to engage constructively with the Opposition, the crossbench, renters' advocates, industry and the community as we work toward fairer and more balanced rental laws for the benefit of everyone in New South Wales. I commend the amendments to the House.
Ms JENNY LEONG (Newtown) (18:58): I speak briefly in support of the amendments moved by the Minister relating to the Residential Tenancies Amendment (Rental Fairness) Bill 2023. The Greens are pleased to see that this element of the bill has been removed, recognising that serious concerns were raised by many stakeholders that this would have the consequence of introducing and formalising rental auctions in New South Wales. If we look at good ways for New South Wales to lead the way in rental reforms, I do not think being the country's only jurisdiction that sanctioned rental auctions is the way. So we are pleased to see that that has been removed.
We also recognise another small change—different to the removal of new section 22B—that ensures that placing a sign on or near residential premises for rent without stating the amount of rent for the premises on the sign is not in contravention. We recognise and support that amendment. I acknowledge the Minister, everyone on the committee and those who made submissions to the inquiry for getting us to this point. It is a good sign that we are working collaboratively to ensure that legislation is passed, and that the Government is willing to recognise that amending and shaping laws by listening to the community's interests and concerns is a good way to pass laws in this State.
Mr ALEX GREENWICH (Sydney) (19:00): I echo the comments of the member for Newtown and commend the Minister and the Government for the process that has been undertaken to improve the bill. I was glad to be a member of the committee, along with a number of members in the Chamber. The process was a good opportunity for us to hear from stakeholders. It was clear from all those who made submissions that there was a respect for the Government's intention to improve transparency in the rental process and a great deal of appreciation that the Government is leading with long-overdue rental reforms, which are reflected in the bill. These are really good amendments and I welcome them. I thank the Government and the Minister for their approach.
The ASSISTANT SPEAKER (Mr Jason Li): The question is that Government amendments Nos 1 to 6 on sheet c2023‑036A be agreed to.
Amendments agreed to.
The ASSISTANT SPEAKER (Mr Jason Li): The question is that clauses 1 and 2 and schedules 1 to 3 as amended be agreed to.
Clauses 1 and 2 and schedules 1 to 3 as amended agreed to.
Third Reading
Mr ANOULACK CHANTHIVONG: I move:
That this bill be now read a third time.
Motion agreed to.
