New South Wales Draft Lease Agreement
The Residential Tenancies Act 1987 governs the majority of Residential Tenancy in NSW. The act applies to both written and verbal agreements and covers most residential tenancies including some caravan parks.
However, there are some exceptions. These include tenants who are living in hotels and motels, holidays homes, aged care facilities and residential parks. For a more extensive list of exemptions and rules, please refer to Residential Tenancies Act 1987.
Prior to entering the agreement or the premises, there are several documents the tenant must receive from the Landlord or the Landlord's Agent. Thes include a written copy of the lease, a list of costs that they will need to pay when they sign the lease, and a booklet called The Renting Guide. This booklet is freely available from the NSW Office of Fair Trading and outlines and explains the rights and responsibilities of the Landlord and those of the tenant.
The Lease Agreement
The lease or rental agreement is a binding contract between the tenant and the landlord. The draft lease agreement is made up in two parts .
- The first part defines the rights and obligations of the parties as prescribed under the act.
- The second part is the property condition report. The tenant must be given time to read and understand the terms of the tenancy agreement before being asked to sign it.
Condition Report
At the commencement of the lease, the Landlord is required to fill out and sign three (3) copies of what's called the 'condition report'. Two of these copies must be given to the tenant. The tenant then has the right to agree or disagree, and can indicate this by placing a tick or comment in the corresponding space. If the tenant disagrees with the report, then this is the time to state this. The tenant must sign and return one copy of the completed condition report to the Landlord or Landlord's agent within five (5) business days and is to keep the second copy as their own.
Bond
The maximum allowable bond for a premises differs according to the weekly rent and furnishings. For unfurnished premises, the maximum rent is 4 weeks rent (one calender month). Whereas, for a fully furnished premises the maximum bond is 6 weeks rent, with a rent of less then $250 or less per week. Bond is unlimited for fully furnished premises with a weekly rent of more then $250 per week.
Rent in Advance
It is usual for 2 weeks rent to be payed in advance from the first day of the tenancy, if the weekly rent is $300 or less per week. If the weekly rent exceeds $300, then upto four weeks (one calender month) is acceptable to ask for in advance.
Terminating Lease Agreements
In the last 14 days of a fixed term agreement, either party can give notice to end the tenancy. After this fixed term agreement has ended, then the Landlord must give 60 days notice, and tenants 21 days notice, of termintation of the rental agreement. If the tenant breaks the tenancy lease agreement, then the Landlord is entitled to claim for compensation for any loss suffered, including the cost in finding a new tenant.
Draft Lease Agreement kits are available as a downloadable MS word document. Unlike a hardcopy agreement the MS word document can be used time and again and it also allows a certain amount of flexibility to edit as you see fit.