No-fault evictions in NSW pushing 'more people into homelessness' but little movement on law change

Businesswoman Eman Soliman was issued with an eviction notice just weeks after signing a new lease. (ABC News: Keana Naughton)

When businesswoman Eman Soliman was texted her eviction notice, she assumed it was a mistake.

"There wasn't even a phone call to explain why it had happened," she said.

Less than three months earlier, the single mother of two sons had signed a new lease and was told by the agent she could stay as long as she liked and even thanked her for taking care of the property.

"That was in October. We passed Christmas and New Year's Eve, and then in early January, as soon as everyone went back to work, I got an eviction notice," she said.

"I went, 'Hang on here, what happened? You just renewed us, what did we do?' We had done nothing. I was so shocked and faced with lots of anxiety because I didn't see that coming."

For Ms Soliman, it was the second no-grounds eviction, also known as no-fault eviction, in 18 months.

Despite winning international awards for business leadership, she found herself struggling to find stable accommodation for her family in the tight Sydney rental market.

Data from the government's End of Tenancy Survey published in 2022, indicates one renter is issued a no-grounds eviction every 18 minutes — leaving more than 28,000 renters looking for new homes every year.

Results from the most recent survey are expected to be released later this year.

Saffron Harris, a tenants' advocate in the Blue Mountains, said overwhelming demand and rising rents made it increasingly difficult for renters to find a home.

"We're noticing more people, even after getting an extension of time on their eviction notices, still aren't finding places. More people are exiting into homelessness," she said.

What are no-ground evictions?

Under current law, landlords in NSW are able to terminate rolling leases at any time without reason.

The only requirement is that they give the tenant 90 days' notice.

Both Labor and the Coalition went into the 2023 state election promising to ban this type of eviction.

Fifteen months later, the government has yet to put forward new legislation.

Greens MP Jenny Leong this year introduced a private member's bill to outlaw no-grounds evictions but neither the government nor the opposition supported the bill.

Instead, the matter was referred to a committee for inquiry that will report back to parliament in September.

Fair Trading Minister Anoulack Chanthivong said the government was committed to reform but wanted to ensure it got the new legislation right.

"What we want to do is take a considered and methodical approach to ensure the policy and the regulations that we table in the parliament are balanced and they're fair," he said.

"The last thing we want to do is make things worse for renters and scare away investors."

But Ms Harris said the delay in legislative reform has left tenants facing uncertainty.

"It's been quite frustrating because it feels like it's been a really long time, and since then so many people have been given no-grounds notices," she said.

"We keep saying 'It's going to change soon but we don't know when,' so it's not helping people."

Fear some tenants could be 'left behind'

Two types of leases are available to renters and landlords: fixed-term leases, in which the tenants sign on for a specified time, and periodic or rolling leases, which have no specified end date.

Many fixed-term agreements become rolling leases automatically once the fixed term has expired.

While landlords can issue a no-grounds eviction to tenants on rolling leases at any time, the law prohibits them from issuing no-grounds evictions to tenants on fixed-term leases before the end of the lease.

Once that date approaches, however, landlords only need to give 30 days' notice.

Ms Harris said in the current climate most tenants will get either a rent increase or a no-grounds termination notice one month prior to the end of their lease.

Tenants Union NSW chief executive Leo Patterson Ross said he wanted any new laws to protect the rights of all 1 million renting households in the state — just over half of whom are on fixed-term contracts.

He said bans on no-fault evictions introduced in Queensland and Tasmania have been largely ineffective, as they did not cover tenants on fixed-term agreements, creating a loophole for landlords to shift people onto these leases to avoid the reforms.

"A benefit to New South Wales of being left behind a little bit by the other states is that we do have the opportunity to learn from their mistakes and do this reform properly to begin with," Mr Patterson Ross said.

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