Advertising and rent bidding on rental properties

Landlords' and agents' responsibilities

Landlords or agents cannot solicit or invite an offer of rent that is higher than the advertised price for a residential rental property. This applies 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.

A landlord or agent must include a fixed price on advertisements for residential rental properties.

This means properties cannot be advertised with a price range (for example: $500 - $550), or with text like 'offers from' or 'by negotiation'.

Signs used on or near the property may advertise that it is available for rent without listing a price.

Agents or landlords can still accept a higher rental offer if it is made freely and voluntarily by a prospective tenant. In the case where a prospective tenant asks if they should offer a higher rent or about 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.
• 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.

Tenants' rights

Tenants are able to offer higher rents for a rental premises if they do it voluntarily and freely.

Scenarios - agent or landlord responses to questions from prospective tenants

Scenario 1

A prospective tenant asks if anyone else has offered more than the advertised rent 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 $30 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 - 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 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 rent advertisement laws.

Scenario 2

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 rent advertisement laws.

Scenario 3

The online listing for a rental property includes an icon that says ‘make an application.’

This complies with NSW rent bidding laws.

An icon that says ‘make an offer’ would not comply with NSW rent bidding laws.

Scenario 4

The online listing for a rental property says ‘$800 per week, deposit taken’.

This complies with NSW 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 5

The online listing for a rental property says the property is ‘leased’ and does not have an advertised price.

This complies with NSW 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.

Scenario - 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 rent bidding laws because it is inviting prospective tenants to offer a higher rent price.