Background-check fees banned in reform for renters

The cost of background checks will not be borne by prospective tenants under reforms planned for Australia’s most expensive rental market.

The NSW government says renters are increasingly being asked to fork out for background checks to apply for a property, paying up to $30 through some online application portals.

Fair Trading Minister Anoulack Chanthivong said some prospective tenants were being lured with the promise that paying for the optional background check would increase their chance of securing a property.

But people should not have to pay for that privilege, he said.

“We need a more modern and fairer rental market in NSW because renters are being punished by a system that hasn’t kept up with change,” Mr Chanthivong said.

Premier Chris Minns said the change “gets the balance right between renters and homeowners” and was part of a broader plan to build a fairer rental market in NSW.

Only specific charges for deposits, bonds, rent and fees for registering longer leases will be able to be passed on to renters in the state.

Landlords will still be able to check and make reports to third-party tenancy databases under strict existing rules.

Tenants who have left a property owing money or have had their lease agreement terminated by the state’s Civil and Administrative Tribunal for doing something wrong can be listed on the databases.

The change is part of reforms to renting in NSW, including legislation to end no-grounds evictions the government plans to introduce to parliament in September.

A scheme allowing tenants to digitally transfer their bond from one property to another, rather than shelling out for their new home’s security deposit before their old one is returned, is also planned to be introduced in 2025.

Sydney has consistently been Australia’s most expensive rental market, with houses costing $100 a week more than the combined-capital median, according to recent figures from property site Domain.

Meanwhile, Victoria’s renting task force targeting dodgy behavior by landlords and agents launched inspections at the weekend to investigate whether offered rentals meet mandatory minimum standards.