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Fears key NSW rental reform could spark 'bidding war'



New South Wales' peak social services body has welcomed the state government's proposed rental reforms, but warned that one policy could worsen the issue it's trying to address.

Speaking a day after the new Labor government introduced its rental bill to parliament, the acting boss of the NSW Council of Social Service said the attempt to outlaw secret bidding on properties listed for lease could backfire.

The proposed reform would require real estate agents to notify all applicants for a property if someone has submitted a bid higher than the listed price.

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Aged apartment buildings are seen for lease

"While we understand the intention of this measure, we hold great concern around the potential unintended consequences," acting NCOSS CEO Ben McAlpine said.

"Having to disclose a higher offer to every applicant may result in a bidding war that knocks out candidates who otherwise would have had a chance.

"Silent rental auctions may result in unfair rental outcomes. We urge the NSW parliament to closely consider the implications of this as it debates the bill."

McAlpine welcomed the other major aspect of the bill, which seeks to make rental bonds transferable between properties, saving tenants who are moving houses from having to pay for a new bond while waiting for the return of their old one.

READ MORE: NSW to outlaw 'secret' rent loophole, make life easier for tenants

NSW Premier Chris Minns (right) and Minister for Better Regulation and Fair Trading Anoulack Chanthivong (left)

"The situation where you need to fork out a bond for the next rental while waiting for a refund from your existing one is simply untenable for low-income households," he said.

"It acts as a financial barrier to moving to a more suitable house, and adds to the significant financial pressure of moving house.

"A portable bond scheme will reduce stress and strain on renters, so we are pleased to see this sensible measure included in the bill."

NCOSS has also called on the state government to bolster social housing supply.

"We are encouraged by NSW Labor's swift progress to commence rental reform, but we need to make sure we get the detail right and that we protect the most vulnerable," McAlpine said.

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