NSW Rent Increase Notice: 60 Days & 12-Month Rule

This guide covers NSW residential tenancy rent increase notices for landlords under the Residential Tenancies Act 2010. It does not cover UK Rent Repayment Orders, commercial lease rent reviews, social housing, rent assistance, or rent increase rules in other Australian states.

If you’re a self-managing landlord in New South Wales, increasing the rent is one of the most legally regulated actions you can take during a tenancy. Get the process wrong — wrong timing, wrong notice period, or no written notice at all — and your tenant can refuse to pay the increase, or you could face a financial penalty from NSW Fair Trading.

The rules changed significantly on 31 October 2024 as part of the NSW rental law reforms. Previously, the once-per-12-months restriction only applied to periodic leases and fixed-term leases of two years or more. It now applies to all lease types — including short fixed-term agreements. If you’re still operating under the old rules, you may already be non-compliant.

This guide covers the current law on rent increases in NSW, grounded in the Residential Tenancies Act 2010 (as amended by the Residential Tenancies Amendment Act 2024) and the Residential Tenancies Regulation 2019.

If you’re changing rent during an existing tenancy, it helps to review the NSW lease agreement guide and the broader NSW residential tenancies act guide first. If money is later disputed at the end of the tenancy, our NSW rental bond guide guide is the other page you’ll most often need.

The Two Core Rules

Every rent increase in NSW must satisfy two requirements under Section 41 of the Residential Tenancies Act 2010. Both must be met — satisfying one without the other makes the increase non-compliant.

Rule 1: The 12-Month Minimum

Rent cannot be increased within 12 months after the start of the tenancy, and cannot be increased more than once in any period of 12 months (Section 41(1A)). This applies to every residential tenancy agreement in NSW — periodic, fixed-term of any length, and renewals.

This rule was amended by the Residential Tenancies Amendment Act 2024 and commenced on 31 October 2024. Before that date, the once-per-12-months restriction did not apply to fixed-term agreements of less than two years. It now applies to all lease types.

Rule 2: 60 Days’ Written Notice

The tenant must be given written notice at least 60 days before the increased rent becomes payable (Section 41(1)). The notice must specify two things: the increased rent amount, and the day from which it is payable.

This notice requirement applies even if the details of the rent increase are already set out in the tenancy agreement (Section 41(5)). In other words, writing a rent increase into the lease does not remove the obligation to give formal written notice — you must still serve it.

Renewals and Replacement Agreements

A common question landlords have is whether a renewal or replacement agreement resets the 12-month clock. It does not.

Under Section 41(2), a tenancy agreement and a subsequent agreement for the same premises are treated as a single agreement for rent increase purposes if the subsequent agreement is a renewal or replacement of the first (even if it is a different type of agreement), the landlord is the same, at least one tenant is the same, and the tenant occupies the premises immediately before and after the changeover.

This means you cannot increase the rent by signing a new agreement with the same tenant at a higher rate and treating it as a “new” tenancy. The 12-month period runs continuously from the last increase (or from the start of the tenancy if no increase has occurred).

The 2024 Reform: What Changed and What Didn’t

The Residential Tenancies Amendment Act 2024 extended the once-per-12-months rule to all lease types from 31 October 2024. Here is what this means in practice.

What changed: Fixed-term agreements of less than two years are now subject to the same once-per-12-months restriction as periodic and longer fixed-term leases. This applies to leases entered into after 31 October 2024 and also extends to leases that were already in place when the reform commenced.

The transitional exception: There is one exception for existing leases. Under Schedule 2, clause 34 of the Act, an “excluded agreement” — defined as a fixed-term agreement of less than two years entered into before the repeal of Section 42 — continues to be governed by the old Section 42 rules. The Residential Tenancies Regulation 2019 (clause 61(2)(a)) mirrors this by providing that the once-per-12-months standard form term does not extend to existing fixed-term agreements of less than two years entered into before 13 December 2024. For those specific leases, rent can only be increased if the increase was validly written into the agreement. Importantly, an excluded agreement is not treated as forming a single agreement with any subsequent agreement (Schedule 2, clause 34(3)) — so once the fixed term expires and a new agreement is signed, the 12-month clock starts fresh under the current rules.

What didn’t change: The 60-day written notice requirement has been in the Act since before the 2024 reforms. The requirement to specify the new rent and the effective date has not changed. The tenant’s right to challenge an excessive increase at NCAT has not changed.

How to Issue a Rent Increase Notice

There is no prescribed form for a rent increase notice in NSW. However, the notice must be in writing and must include two specific pieces of information required by Section 41(1): the increased rent amount, and the day from which it is payable.

The notice must be given at least 60 days before the date the increased rent takes effect. If you serve the notice too late — even by one day — the tenant is not obliged to pay the increased rent from the date you specified.

Serving the Notice

Rent increase notices must be in writing. If the tenant has given specific permission for a nominated email address to be used for serving notices, you can serve the notice by email. Otherwise, the notice should be served in the manner permitted under the Act.

Cancelling or Reducing an Increase

You can cancel or reduce a rent increase by giving the tenant a subsequent written notice (Section 41(6)). The later notice takes effect from the same date as the original notice — you cannot apply it to a different date.

This is useful if you issued a notice but then decided the increase was too high, or if you and the tenant negotiated a lower figure. You do not need to withdraw and re-issue the original notice — just issue a new one specifying the reduced amount.

When No Notice Is Required

There is one situation where you do not need to give notice of a rent increase: when the increase arises because a rent reduction ends or is reduced (Section 41(7)). For example, if you agreed to a temporary rent reduction while repairs were being carried out, the rent automatically returns to the original amount when the reduction period ends — no 60-day notice is required for that reversion.

These Rules Override Your Lease

All of the rules in Section 41 — the 12-month minimum, the notice requirement, the cancellation provisions — are terms of every residential tenancy agreement by operation of Section 41(8). This means they apply regardless of what your written agreement says. You cannot contract out of them, and any term in your lease that conflicts with these rules is void.

What Happens If You Get It Wrong

If you increase the rent without complying with Section 41, the increased rent is not payable (Section 41(3)). The tenant can simply continue paying the old rent.

Beyond the tenant refusing to pay, contravening Section 41 is an offence. A significant financial penalty applies (Section 41(9)).

There is also a time limit on challenges. NCAT must not make an order that a rent increase is not payable due to non-compliance with Section 41 unless the tenant’s application is made within 12 months of the increase (Section 41(10)). If the tenant does not apply within 12 months, the rent increase is taken to comply with the section — even if it technically did not.

Your Tenant’s Right to Challenge: Excessive Rent at NCAT

Even if you follow the correct process — proper notice, correct timing — your tenant can still challenge the increase at NCAT (the NSW Civil and Administrative Tribunal) on the grounds that it is excessive.

How the Challenge Works

Under Section 44 of the Act, a tenant can apply to NCAT for an order that a rent increase is excessive. The application must be made within the period prescribed by the Regulations — which is 30 days after the notice of increase is given (Regulation clause 39(1)).

If NCAT agrees the increase is excessive, it can order that the rent must not exceed a specified amount from a specified day. That order can remain in effect for up to 12 months (Section 44(6)).

What NCAT Considers

NCAT does not simply compare your rent to the cheapest available property in the area. Under Section 44(5), the Tribunal may consider the general market level of rents for comparable premises in the locality, your outgoings under the agreement, any fittings, appliances, goods, services or facilities provided with the premises, the state of repair of the premises, the accommodation and amenities provided, any work done to the premises by the tenant, when the last increase occurred, and any other matter it considers relevant.

One thing NCAT specifically cannot consider is the tenant’s income or ability to afford the increase (Section 44(5)(h)). The test is whether the rent is excessive relative to the property and market — not whether the tenant can pay it.

What This Means for You as a Landlord

If your rent increase is broadly in line with market rents for comparable properties in your area, a challenge at NCAT is unlikely to succeed. But if you increase the rent significantly above market rates — especially on a property in poor repair or with reduced amenities — you are exposed.

The practical takeaway: research comparable rents in your area before issuing a notice. If your increase is reasonable and supported by market evidence, you are in a strong position to defend it.

Rent Reductions and Abatement

The Act also provides for rent to go the other direction. Under Section 43, rent automatically abates (reduces) if the premises are destroyed or become wholly or partly uninhabitable (other than through a breach of the agreement), cease to be lawfully usable as a residence, or are compulsorily acquired.

Separately, a tenant can request a rent reduction in writing if you reduce or withdraw any goods, services or facilities provided with the premises (Section 43(1)) — even if those were provided under a separate or previous arrangement. If you and the tenant cannot agree, the tenant can apply to NCAT.

You and the tenant can also agree to reduce the rent at any time (Section 43(4)). A common scenario is agreeing to a temporary reduction during periods when the tenant is required to give access to prospective purchasers (Section 43(3)).

Receiving Rent: Payment Methods You Must Offer

While this guide focuses on rent increases, it is worth noting the payment method obligations that apply to all rent collection in NSW. You must offer your tenant payment by approved electronic bank transfer (such as a funds transfer or BPAY). From 2 March 2026, you must also offer Centrepay as a payment option and enable it if the tenant chooses it. You cannot charge or pass on to the tenant any cost you incur for either payment method.

You can offer other payment methods in addition to these, but you cannot require the tenant to use a particular payment service or app.

If a rent dispute ends with the tenancy changing or ending, pair this page with our NSW eviction notice guide and NSW break lease guide guides. For the evidence that often sits behind later claims, our NSW condition report guide guide is worth keeping handy as well.

Common Mistakes Landlords Make with Rent Increases

Increasing Rent on a Renewal Without Checking the 12-Month Rule

If your tenant’s fixed-term lease expires and you sign a new agreement at a higher rent, check when the last increase occurred. Under Section 41(2), the renewal is treated as a continuation of the original tenancy. If less than 12 months have passed since the tenancy started (or since the last increase), the increase is not compliant — regardless of whether the tenant signed the new agreement at the higher rate.

Relying on the Lease to Avoid Giving Notice

Some landlords write a scheduled rent increase into Part A of the tenancy agreement — for example, “Rent increases to $650/week after 12 months.” This does not remove the obligation to give 60 days’ written notice. Section 41(5) is explicit: notice must still be given even if the increase is set out in the agreement.

Giving Less Than 60 Days’ Notice

The notice period is measured from when the notice is given — not when the tenant reads it — to the day the increased rent becomes payable. If the notice is given less than 60 days before the effective date, the increase is not compliant and the tenant can refuse to pay it.

Issuing Multiple Increases Within 12 Months

Under the current rules, you cannot increase rent more than once in any 12-month period — for any lease type. Issuing a second notice within the same 12-month window is a contravention of Section 41, even if the first increase was small.

Assuming a New Tenant Resets the Clock

If you have a new tenancy agreement with an entirely new tenant for the same property, the 12-month restriction starts fresh from the new tenancy’s commencement date. But if at least one tenant carries over from the previous agreement, the clock does not reset — the agreements are treated as a single tenancy under Section 41(2).

Frequently Asked Questions About Rent Increases in NSW

How often can I increase the rent in NSW? Once per 12 months, for all lease types. This applies to periodic agreements, fixed-term agreements of any length, and renewals. Rent also cannot be increased within the first 12 months of a tenancy. This is set out in Section 41(1A) of the Residential Tenancies Act 2010.

How much notice do I need to give for a rent increase in NSW? At least 60 days’ written notice before the increased rent becomes payable. The notice must specify the new rent amount and the date it takes effect (Section 41(1)). This applies even if the increase is already written into the tenancy agreement.

Can my tenant refuse a rent increase? If you have not complied with Section 41 — for example, insufficient notice or increasing within 12 months of the last increase — the tenant is not obliged to pay the increased rent (Section 41(3)). Even if you followed the correct process, the tenant can apply to NCAT within 30 days to challenge the increase as excessive.

What form do I use for a rent increase notice? There is no prescribed form. The notice must be in writing and must specify the increased rent and the day from which it is payable.

Can I increase the rent when signing a new lease with the same tenant? Only if at least 12 months have passed since the tenancy started or since the last increase, whichever is later. Under Section 41(2), a renewal or replacement agreement with the same landlord and at least one of the same tenants is treated as a continuation of the original tenancy for rent increase purposes.

Does the once-per-year rule apply to leases signed before the 2024 reforms? Yes, with one exception. The once-per-12-months rule now extends to all existing leases. However, under Schedule 2, clause 34 of the Act and clause 61(2)(a) of the Regulation, it does not extend to existing fixed-term agreements of less than two years that were entered into before the repeal of Section 42 (13 December 2024). For those leases, rent can only be increased if it was validly written into the agreement. Once the fixed term ends, the current rules apply in full.

What happens if NCAT finds my rent increase is excessive? NCAT can order that the rent must not exceed a specified amount from a specified day. The order can last for up to 12 months and is binding on both you and the tenant (Section 44(6)). NCAT considers factors like market rents for comparable properties, the state of repair of your premises, amenities provided, and when the last increase occurred — but not the tenant’s income or ability to pay.

Can I cancel a rent increase after issuing the notice? Yes. You can cancel or reduce the increase by giving the tenant a subsequent written notice. The later notice takes effect from the same date as the original notice (Section 41(6)).

Is there a cap on how much I can increase the rent? There is no fixed cap or percentage limit on rent increases in NSW. However, if your increase is excessive relative to the market and the property, the tenant can challenge it at NCAT. The practical limit is what comparable properties in your area are renting for.

What penalty applies if I increase the rent incorrectly? Contravening Section 41 is an offence carrying a significant financial penalty (Section 41(9)). NSW Fair Trading can also issue penalty notices for non-compliance.

Summary

Rent increases in NSW are straightforward if you follow the rules: no increase within the first 12 months, no more than once per 12 months after that, and at least 60 days’ written notice every time — even if the increase is written into the lease. The 2024 reforms extended these rules to all lease types, so there are no longer any exceptions for short fixed-term agreements.

If your increase is in line with the market and you follow the correct process, you are well positioned. If you skip the notice, miscalculate the timing, or increase well above market rates, you are exposed — to both a tenant challenge at NCAT and a penalty from NSW Fair Trading.

For more on your obligations as an NSW landlord, see our guides on lease agreements, rental bonds, eviction notices, and breaking a lease.

Related guides for NSW landlords

If you are building out the full landlord workflow for this state, these guides connect this page to the rest of the tenancy process.

Same-state guides

• NSW lease agreement guide
• NSW rental bond guide
• NSW condition report guide
• NSW eviction notice guide
• NSW break lease guide

Compare rent increase guides in other states

• WA rent increase guide
• QLD rent increase guide
• VIC rent increase guide
• SA rent increase guide
• Tasmania rent increase guide
• ACT rent increase guide