Types and Length of Lease Policy

1. Background

The purpose of this policy is to explain the type and length of Residential Tenancy Agreement (lease) offered by Homes NSW and how they will be reviewed. The Tenancy policy supplement provides further information to support this document.

Homes NSW will offer the type and length of lease that reflects a client’s need and circumstances, making a decision based on the information provided by the client as well as other relevant information. Homes NSW will explain the decision on the type and length of lease it will offer when assessing a new application and when conducting a lease review.

2. Scope

This policy applies to all properties managed by Homes NSW, including Aboriginal Housing Office (AHO) properties.

3. Policy statement

Homes NSW will offer and review leases in accordance with:

• the Housing Act 2001
• Residential Tenancies Act 2010 and Regulations
• the terms of the residential tenancy agreement
• where relevant, Homes NSW policies.

Most new tenancy agreements will be for a fixed term period of twelve months, two, five or ten years. The length of the agreement will depend on the circumstances of the client and any specific conditions attached to the particular offer of housing. There are limited circumstances where, within three months of the tenant signing a fixed term lease of two or five years, Homes NSW will agree to change the length of that lease.

Homes NSW will review the tenancy before the fixed term ends to decide:

• if the tenant is still eligible for Homes NSW managed housing, and if so,
• what type and length of lease extension the tenant should be offered, and
• if the current property is appropriate to the needs and size of the household.

Types and length of leases offered

All new tenants who are assessed as eligible for a five or ten year lease are required to enter into a fixed term twelve month probationary lease.

Ten year leases are for clients with ongoing housing and high support needs that are unlikely to decline.

Five year leases are for clients with housing and support needs that will most probably continue in some form over the next five years.

Two year leases are for clients:

• with transitional or temporary support needs that will probably decline over the next two years or
• the client’s continuing need for social housing is unclear over the next five years because the household’s financial circumstances may improve.

Twelve month probationary leases

All clients who are assessed as eligible for a five or ten year lease are required to enter into a fixed term twelve month probationary lease.

The probationary lease aims to set expectations of good behaviour at the start of the tenancy.

Before the end of twelve months Homes NSW will determine if the tenant has abided by the terms of their tenancy agreement to remain eligible for an extension of the lease for a further four or nine years.

Fixed term lease of six months due to former tenancy with Homes NSW

Six month fixed term leases are for clients who:

• are offered housing and,
• had a history of antisocial behaviour as an additional household member in another person’s tenancy, or
• are former tenants of a Homes NSW managed property, and
• were classified as unsatisfactory, or less than satisfactory (due to having a record of substantiated antisocial behaviour) when they left their previous Homes NSW managed tenancy. For further information go to the Ending a tenancy – Categorising a tenancy located in the Tenancy policy supplement.

Fixed term lease of three months for emergency temporary accommodation

Three month fixed term leases are for clients who are offered Emergency Temporary Accommodation.

There are specific entitlements and obligations for tenants on three month fixed term leases. For more information, go to Tenancy entitlements and obligations in this policy.

Fixed term provisional leases

Homes NSW may offer a provisional lease of three or six months to members of a public housing household (including Aboriginal Housing Office properties) when the tenant dies or stops living in the property for health reasons or due to imprisonment. Homes NSW will not offer a provisional lease to a household member unless they are an Australian citizen or permanent resident.

The six month provisional lease is for household members who:

• wish to apply for Recognition as a Tenant to a Homes NSW managed property. The aim of the lease is to ensure members of the household have a stable tenancy while they wait for the outcome of their application, and if it is declined, allow adequate time to look for alternative accommodation, or
• have decided not to apply for Recognition as a Tenant to a Homes NSW managed property and need time to find alternative accommodation.

The existence of a recognition as a tenant provisional lease does not deem the client ineligible for priority housing assistance. The client may still be in urgent need, and an appropriate assessment will be undertaken to determine if the client is able to resolve that need in the private rental market. For further information, go to the Eligibility for Social Housing policy.

Three month provisional leases are for clients who are Australian citizens or permanent residents who did not request a six month provisional lease or seek Recognition as a Tenant to a Homes NSW managed property within the required timeframe. The aim of the lease is to ensure members of the household have stable tenancy while they look for alternative accommodation.

For more information, go to Assessment criteria for allocating the type and length of lease in this policy

For more information about eligibility for Recognition as a Tenant to a Homes NSW managed property, go to the Changing a Tenancy policy.

There are specific entitlements and obligations for tenants on a provisional lease. For more information, go to Tenancy entitlements and obligations in this policy.

Fixed term leases of 12 months

Historically, Homes NSW offered 12 month leases to existing tenants who:

• had an 18 month interim lease, and
• underwent a review at the end of their 18 month lease, and
• were not eligible for a two, five or ten year lease extension to their lease.

From May 2008 Homes NSW ceased to offer 12 month fixed term leases.

Continuous leases

Continuous leases apply to tenants who were housed before 1 July 2005 and who have lived continuously in a property owned or managed by Homes NSW since being housed. Continuous leases do not have a set end date. The lease continues as long as the tenant lives in social housing, provided the tenant meets the terms and conditions of their lease, although the tenant may be asked to vacate the property if they own property that could be used to provide housing for them.

Homes NSW no longer offers continuous leases to new tenants starting a tenancy in a property owned or managed by Homes NSW.

Type and length of lease offered after a change of tenancy

If a social housing tenant is approved for a change of tenancy, when they are housed, their length of lease and other entitlements are outlined in the Changing a Tenancy policy.

Tenancy entitlements and obligations

All Homes NSW tenancy agreements are regulated by the rights and obligations outlined in the Residential Tenancies Act 2010. Additional obligations provided under Homes NSW policy apply to all tenants. Rent and other charges for all tenants are assessed in accordance with the Tenancy Charges policy.

Tenants in receipt of a three month lease due to Emergency Temporary Accommodation or who have been given a provisional lease (of three or six months) have not been assessed as eligible for social housing and have not waited on the NSW Housing Register for a social housing property.

As a result, these tenants do not receive the same entitlement as other tenants. At the end of their three or six month lease, Homes NSW expects these tenants to have found alternative accommodation and vacated the property, unless they have been approved to continue living in public housing through a social housing assessment process (in the case of tenants who have a three month lease due to Emergency Temporary Accommodation) or the Homes NSW Recognition as a Tenant assessment process (in the case of tenants with a six month provisional lease).

Where a tenant has a six month provisional lease and:

• Is approved to continue living in public housing through the recognition as a tenant process, they are granted the same entitlements as tenants on other leases, from the date they are approved. The appropriate length of lease is granted at the end of the provisional lease. For more information, go to the Changing a Tenancy – Type and Length of Lease Offered.
• Is awaiting approval to continue living in public housing through the Homes NSW Recognition as a Tenant process, they may request permission to have an additional person join the household, if that person will be their live-in carer.

For more information on reviewing three month leases due to Emergency Tenancy Accommodation see Lease reviews.

Assessment criteria for allocating the type and length of lease

Fixed term lease of ten years (subject to twelve month probationary lease)

The client or another approved member of the household:

• is aged 65 years or over, or
• is an Aboriginal and/ or Torres Strait Islander person aged 45 years or over, or
• receives support from a person receiving the Centrelink Carer Payment or Carer Allowance (this carer does not need to reside in the property), or
• receives support from one of the following programs:
  • Attendant Care Program
  • ADAHPT (Aids, Dementia & HIV Psychiatry Team) Service
  • Children's Home Ventilation Program
  • High Needs Pool (Care Program)
  • Housing and Accommodation Support Initiative (HASI)
  • Insurance and Care NSW (Icare)
  • Community Aged Care Package
  • EACH (Extended Aged Care at Home) Package
  • Ventilator Dependent Quadriplegic Program
  • Community Living Supports (CLS)
  • National Disability Insurance Scheme (NDIS)

Fixed term lease of five years (subject to twelve month probationary lease)

• the client’s household includes at least one child under 10 years of age, or
• the client or another approved member of the household:
  • is in receipt of a Disability Support Pension, Age Service Pension, Invalidity Service Pension, Partner Service Pension, Carer Payment, Carer Allowance or Mobility Allowance, or
  • is a client of the NSW Trustee and Guardian; or
  • is a client of the NSW Public Guardian, or
  • is participating in the Brain Injury Rehabilitation Program, or
  • is participating in a Transition to Work Program or Community Participation Program, or
  • is a young person aged 16-18 years leaving the care of Community Services, Out-Of-Home Care, or juvenile detention and receiving the Youth Disability Supplement, or
  • has an enduring (permanent, or likely to be permanent) disability, medical condition or permanent injury restricting everyday activities, but does not receive support from a listed program, and
  • can show that because of their condition, significant hardship would occur if a two year fixed term lease was offered (instead of a five year fixed term lease).

Fixed term lease of two years

• the household is eligible for housing in a property owned or managed by Homes NSW but does not meet the assessment criteria for any of the other types and lengths of lease listed in this section, or
• the household is not eligible for a lease extension but can demonstrate a severe and continuing need to stay in social housing. For more information, go to Exemptions for two, five and ten year leases in this policy.

Fixed term lease of six months due to former tenancy with Homes NSW

The tenant had a former tenancy with Homes NSW, which was classified as unsatisfactory, or less than satisfactory due to having a record of substantiated antisocial behaviour. For more information, go to the Eligibility for Social Housing policy. Homes NSW may also offer this lease to people who had a history of antisocial behaviour as an additional household member in another person’s tenancy.

Fixed term lease of three months for emergency temporary accommodation

The client is housed through emergency temporary accommodation.

Fixed term provisional lease

A client will be offered a provisional lease of six months if they have demonstrated:

• the tenant has died or has left the property due to health reasons or as a result of being imprisoned, and
• they are a member of the tenant’s household, either:
  • an approved additional occupant, or
  • an unauthorised occupant who can prove they were living in the property at the time of the event. For more information, go to the Tenancy policy supplement – Evidence Requirements for unauthorised occupant living in the property or,
  • a formal or informal carer of children or young persons, and
• they are an Australian citizen or permanent resident.

And Homes NSW has also confirmed:

• The existing tenancy has been:
  • relinquished by the tenant or their estate; or
  • approved to be taken over upon receipt of a death certificate, where a tenant has died without a will and the estate is not being managed by the NSW Trustee and Guardian;
  • otherwise terminated under the Residential Tenancies Act 2010, and
• The client both notified Homes NSW of the tenant dying or leaving the property due to health reasons or as a result of being imprisoned, and made a written request for a provisional lease within the required timeframe of the event occurring. For more information regarding the required timeframe, go to the Changing a Tenancy policy – Timeframe to apply.

A client who meets the above criteria but did not comply with the required timeframe and is not eligible for an extension of timeframe will be offered a three month provisional lease.

Homes NSW will consider extending this timeframe if the client demonstrates that there are extenuating circumstances. For more information regarding extending the required timeframe, go to the Changing a Tenancy policy – Timeframe to apply.

Continuous lease

The tenant:

• was housed before 1 July 2005, and
• is listed as a tenant or joint tenant on the lease, and
• since being housed, has lived continuously in a property owned or managed by Homes NSW, or a leasehold property managed by a community housing provider under the long-term Community Housing Leasing Program, or
• a spouse or de facto partner who:
  • has been granted approval to continue living in a property managed by Homes NSW through the recognition as a tenant process, and
  • the previous tenant was on a continuous lease.

Tenants who signed renewable tenancy agreements are included in this category.

A tenant who is entitled to be in this category cannot lose their entitlement to a continuous tenancy due to the following changing circumstances including:

• Signing a new lease or moving to a different property.
• Creating a joint tenancy with a spouse or de-facto partner.
• Transferring to another public housing property.
• Being relocated by Homes NSW for management purposes.
• Moving from an Aboriginal Housing Office property to a public housing property.
• Moving from a public housing property to an Aboriginal Housing Office property.
• Voluntarily moving from a public housing property to subsidised private rental accommodation to access the private rental subsidy (PRS) at the request of Homes NSW, and later returning to a public housing property.
• Transferring to a community housing managed property under the Homes NSW managed Stock Transfer Program and later exercising their entitlement to return to a property managed by Homes NSW.

A tenant who is entitled to be in this category will lose this entitlement to a continuous tenancy if:

• Their lease is terminated by the NSW Civil and Administrative Tribunal.
• They move out of the property to live in another property that is not managed by Homes NSW, other than as part of the Homes NSW managed transfer programs, or relocation for management purposes.
• A joint tenancy is created with another approved household member who is not the spouse or de-facto partner.

Clients will be required to provide relevant information in order for Homes NSW to determine the appropriate lease. For more information, go to the Starting a Tenancy policy.

Changing the length of lease after sign-up

Where a client is about to sign, or has signed, a two, five or ten year lease, Homes NSW will consider a change of lease if the client provides new information or where the original decision on the length of a lease is changed because of a review or appeal.

Homes NSW will consider changing the length of lease at or after sign-up if the tenant provides the following new information within three months of signing their initial lease:

• confirmation of eligibility for Aboriginal housing, products and services for an approved household member who was aged 45 years or over at the time of signing the lease, or
• pension type or support program information that was unavailable at the time of signing the lease, and which changes the Homes NSW’ assessment of the tenant’s required length of lease.

Lease reviews

The assessment criteria for a lease review will depend on the type and length of lease.

When Homes NSW completes a lease review, it will write to the tenant to advise them of its decision.

Lease review at end of twelve month probationary lease

A tenant is eligible for an extension of their probationary lease for the balance of their assessed lease term (a further four or nine years) if, at the time of review they have complied with the conditions of their lease throughout the probationary period. If the tenant is assessed as eligible for a lease extension, Homes NSW will offer a further lease of four or nine years.

The lease extension commences when Homes NSW issues a notice under Section 142 of the Residential Tenancies Act 2010 (Extension of social housing tenancies), advising the tenant that Homes NSW has extended the term of their lease for a specified period. Tenants will not be required to sign a new tenancy agreement.

Homes NSW may take action to end the tenancy under the Residential Tenancies Act 2010 where there has been:

• repeated/persistent cases of rent arrears and/or repayment arrangements not being kept
• intentional damage to the property, neighbouring properties or common areas
• persistent and/or serious incidents of antisocial behaviour, where the behaviour has not been rectified despite attempts from Homes NSW to take steps to address the situation
• substantiated subsidy fraud
• a combination of any of the above.

Tenants who have difficulty meeting their obligations under the tenancy agreement due to complex needs, will be referred to appropriate support services to assist the tenant to manage and sustain their tenancy.

Lease review at the end of a two, five or ten year lease

If the tenant is assessed as eligible for a lease extension at the end of a two, five or ten year lease, Homes NSW will offer a further lease. The length of lease will be based on the household’s needs. The lease extension commences when Homes NSW issues a notice under Section 142 or Section 18 of the Residential Tenancies Act 2010, advising the tenant that Homes NSW has extended the term of their lease for a specified period. The notice is issued after the current tenancy ends and becomes part of the new tenancy agreement. Tenants will not be required to sign a new tenancy agreement.

If the tenant is assessed as ineligible for a lease extension at the end of a two, five or ten year lease, Homes NSW will not offer an extension to the lease and the tenant must move out of the property when the current lease ends.

Leases of two, five or ten years are terminated under Section 143 of the Residential Tenancies Act 2010. Sections 143-147 of the Residential Tenancies Act 2010 are applicable to social housing leases of two, five and ten year fixed terms.

Leases of three and six months are terminated under Section 84 of the Residential Tenancies Act 2010. Sections 143-147 of the Residential Tenancies Act 2010 are not applicable to these leases.

Tenants with two, five or ten year leases who are not eligible for a lease extension, may be eligible for transition assistance to help them move from a Homes NSW managed property into a private rental property or assist with home ownership. For more information see the Transition assistance section in this policy.

Factors that may impact on a lease review decision

In some circumstances Homes NSW may offer a two year lease extension to tenants with two, five or ten year leases who exceed the income limits at lease review and who demonstrate a severe and continuing need to stay in social housing. For more information, go to Exemptions for two, five and ten year leases in this policy.

Where an adverse change in household circumstances occurs after lease review, Homes NSW may reconsider the decision not to offer an extension of a lease. For more information, go to Change of circumstances after lease review for two, five and ten year leases in this policy.

Lease review criteria for fixed term tenancies of two, five and ten years

The following lease review criteria for fixed term tenancies of two, five and ten years is the criteria for eligibility assessments of social housing tenants approved by the Minister for Housing under Section 144 of the Residential Tenancies Act 2010.

The criteria for undertaking a lease review is based on a tenant's assets (property and income) as outlined below:

Property

The tenant is eligible if they or their partner/spouse does not own or part own property or real estate that that they can live in or sell.

Income

The tenant is eligible if the household:

1. Has a total weekly assessable income that is less than or equal to the weekly income limit at lease review for a household of the tenant’s current size and type, or
2. Has a total assessable income for the year preceding the lease review date that does not exceed the income limit for lease review for a household of the tenant’s current size and type, or
3. The tenant has not met the income tests of 1 and 2 above, but can otherwise demonstrate that their need for housing qualifies them for an exemption. For more information, go to Exemptions for two, five and ten year leases in this policy.

The maximum household income (before tax) must not exceed the income limits for lease review. For more information, go to Income limits at lease review in the Tenancy policy supplement. These limits are set at a higher level than the income limits for entry into social housing.

Exemptions for two, five and ten year leases

Tenants with a two, five or ten year lease who exceed the income limits at lease review may be eligible for an exemption if they meet one of the criteria below:

• Protecting households with vulnerable children and young people who are likely to be placed at risk of abuse or neglect if they are required to move from social housing.
• Protecting approved household members with a disability or ongoing medical condition who are likely to be placed at serious risk to health or harm if they moved from social housing due to a lack of access to appropriate and affordable private housing.
• Supporting approved household members to maintain education, employment, training or apprenticeships. The tenant needs to demonstrate that the household member’s chance to gain qualifications by maintaining participation in a current education or training course, or their ability to maintain employment, would be jeopardised if they moved from social housing.
• Preventing homelessness, severe overcrowding or other unsuitable housing situations due to the tenant’s inability to access alternative housing appropriate for their household size and needs if they move from social housing.
• To be eligible for an exemption a tenant must prove:
  • A need to live in their current location where appropriate private housing is unaffordable and inappropriate housing would expose the household to the risks outlined in the exemption criteria, and
  • The household would still face this risk if living in an alternative location where they can afford appropriate private housing.

For the purposes of a fixed term lease review, Homes NSW calculates affordability for private rental accommodation in the area where the household needs to live at 50% (or less) of gross household income. This rental affordability test is used to determine whether a household with an income at or above the income limits at lease review can afford to rent a property in the area where they need to live.

Clients are required to provide relevant information in order for Homes NSW to determine eligibility for an exemption. For more information, go to Evidence requirements for an exemption in the Tenancy policy supplement.

Change of circumstances after lease review for two, five or ten year leases

The assessment of change of circumstances after lease review only applies to tenants with a two, five or ten year lease who are not eligible for an extension to their lease. Homes NSW will only do this in limited and exceptional circumstances. Tenants must demonstrate the following for a change of circumstances to be considered:

• a permanent reduction in income that will result in the household meeting the income limits at lease review, or
• a risk to a household member emerges which is in line with those described in the assessment criteria for exemptions. For more information, go to Exemptions for two, five and ten year Leases in this policy.

Tenants must provide relevant information before Homes NSW will consider a reassessment. For more information, go to Evidence requirements for a change of circumstances after lease review in the Tenancy policy supplement. If Homes NSW decides the tenant is eligible for an extension to their lease due to a change of circumstances, Homes NSW will offer a maximum two year lease extension in accommodation that is appropriate to the size and needs of the household.

The following criteria for tenancies of three and six months are excluded from the criteria for eligibility assessments of social housing tenants approved by the Minister for Housing under Section 144 of the Residential Tenancies Act 2010.

Lease review criteria for fixed term tenancies of three months under Emergency Temporary Accommodation

At the time the lease review is conducted:

• the tenant is still in need of Emergency Temporary Accommodation, or
• the tenant must meet the social housing eligibility criteria including the income limits for entry into social housing. For more information, go to the Eligibility for Social Housing policy.

Lease review criteria for fixed term tenancies of six months for less than satisfactory or unsatisfactory former tenants with a history of antisocial behaviour

At the time the lease review is conducted the:

• tenant meets the income limits at lease review, and
• tenant or the tenant’s partner or spouse does not own or part own property or real estate that they could live in or sell, and
• tenant has repaid any outstanding debt, or has demonstrated a commitment to repay an outstanding debt, and
• tenant has demonstrated an ability to sustain a successful tenancy.

For more information see Income limits at lease review in the Tenancy policy supplement.

Ending a fixed term provisional lease

Provisional leases of six months and three months are not subject to lease review as they are designed to provide household members with an opportunity to find alternative accommodation. For more information on ending a provisional lease, go to When a tenant is not eligible for a lease extension in this policy.

In exceptional circumstances, Homes NSW may consider offering a three month extension of a provisional lease. Homes NSW will not offer an extension of a provisional lease to a client who has breached their tenancy agreement or who has not occupied the property during the period of the provisional lease.

Transition assistance

Transition assistance consists of:

• A Transition Assistance Information Kit which assists tenants who are entering the private rental market or considering home ownership.
• A Homes NSW Statement of Satisfactory Tenancy, which indicates whether the tenant has satisfactorily maintained their tenancy in a Homes NSW managed property. The statement can assist tenants to secure private rental accommodation.
• Rentstart Move, a private rent assistance product which offers a Bond Loan for up to 100% of a rental bond in the form of an interest free loan for clients. Homes NSW pays the bond directly to the Rental Bond Board for eligible clients.

Previous lease review income limits

For previous income limits go to Previous lease review income limits in the Tenancy policy supplement.

4. Legislation and Compliance

Homes NSW manages tenancies in accordance with the provisions of the Residential Tenancies Act 2010 and the Housing Act 2001.

5. Related documentation

• Starting a Tenancy Policy
• During a Tenancy Policy
• Changing a Tenancy Policy
• Tenancy Policy Supplement

6. Further information

Appeals and review of decisions

If a client disagrees with a decision that Homes NSW has made, they should first discuss their concerns with a staff member. The next step if they still believe Homes NSW made the wrong decision is to ask for a formal review of the decision. For information on how reviews work, the client can ask Homes NSW for a copy of the fact sheet Appeals and reviewing decisions, or read the Appeals policy. This policy applies to applicants for public, community and Aboriginal housing.

A tenant cannot request a review of a decision in relation to the length of lease offered once a notice under Section 142 of the Residential Tenancies Act 2010 has been issued.

Approval of criteria for eligibility assessment in relation to Section 144 of the Residential Tenancies Act 2010

The Minister for Family and Community Services approves the criteria for eligibility assessment under Section 144 of the Residential Tenancies Act 2010.

The criteria under Section 144 for eligibility to reside in the class of social housing premises concerned with this section, is the criteria applicable where the residential tenancy agreement of a 2, 5 and 10 year duration is set out (and as amended from time to time) in the Homes NSW policy document entitled "Types and Length of Lease".

Signed by

The Hon. Pru Goward MP
Minister for Family and Community Services
Minister for Women.

Date: 19 March 2013