NSW Portable Rental Bonds Scheme Delayed
The New South Wales (NSW) government's portable bonds scheme, a key election promise aimed at simplifying residential property transitions for renters, has been delayed. This initiative, an Australian first, was designed to allow for the digital transfer of a rental bond from one property to another. This would reduce the financial burden on renters who would otherwise need to secure a new bond before their previous one is returned.
Timeline and Implementation Challenges
Initially, the rollout of the scheme was anticipated for late 2025. However, NSW Rental Commissioner Trina Jones has indicated that the scheme will now become available to renters "sometime" in 2026. Ms. Jones noted that significant progress has been made, but the process involves retrofitting the existing rental bonds online system.
She described the undertaking as new and unprecedented, leading to inherent challenges during its development.
The scale of the system necessitates extensive testing. Approximately $2 billion is held in rental bonds across NSW, with up to 600,000 transactions occurring annually. Minister for Better Regulation and Fair Trading, Anoulack Chanthivong, stated that contracts established by the previous government prevented the IT development from commencing until early 2025. Both officials emphasized the complexity of the scheme and the importance of ensuring a robust system for the security of renters' funds and landlords' access to bonds.
Background of Rental Reforms
While legislation for bond transferral between properties was enacted in 2018, the Minns government committed $6.6 million in 2023 for the creation of a new online system. The NSW Rental Commissioner role, established as part of the state election commitments, was tasked with overseeing this scheme and other rental reforms.
These reforms included:
- Prohibiting "no grounds" evictions.
- Banning rent bidding.
- Restricting the refusal of pets on tenancy applications without valid reasons.
Most of these changes were implemented in May of the prior year.
Stakeholder Reactions
NSW Greens
NSW Greens Spokesperson for Housing and Homelessness, Jenny Leong, questioned whether the delay was more a "political problem" than a "technical one."
She emphasized that renters, facing cost of living pressures, require more clarity on the project's stall, stating that governments should deliver on announced reforms.
Tenants' Union of NSW
Leo Patterson Ross, Chief Executive of the Tenants' Union of NSW, suggested the delay might be due to "reform fatigue." While advocating for the portable bonds' rapid implementation, he also highlighted a lack of communication regarding the expected timeline. He noted that the scheme was initially proposed in 2018 due to existing affordability concerns, estimating current average moving costs, excluding a bond, to be around $5,000.
Real Estate Institute of NSW (REINSW)
The Real Estate Institute of NSW (REINSW) has previously expressed opposition to the portable bonds scheme, recommending that landlords should retain the option to participate if the system were implemented. REINSW Chief Executive Tim McKibbin did not comment directly on the delay but voiced dissatisfaction with the consultation process, citing a lack of detailed information regarding the scheme's mechanics and potential paperwork implications for landlords and property managers.