What happens if your tenant stops paying rent? A guide for NSW landlords
It’s a situation no landlord wants to face: rent doesn’t arrive when it’s due, and your tenant isn’t responding. Whether it’s a temporary setback or something more serious, acting quickly and professionally is critical.
Here’s how a property manager will handle rent arrears under NSW tenancy laws so you don’t have to.
Check the facts first
The first step a property manager takes is to verify whether rent is truly overdue. They’ll review the lease agreement, check the rental ledger, and ensure no administrative or banking errors have occurred. This process helps clarify whether it's a genuine breach or simply a delay.
Property managers keep meticulous records and will issue reminders to tenants as per the terms of the agreement before any formal action is taken.
Open communication is key
Once arrears are confirmed, the property manager will promptly contact the tenant. This typically involves a courteous call or written notice asking for an update and inviting the tenant to explain the situation. If the tenant is experiencing temporary hardship, the property manager may discuss a short-term payment arrangement.
All communication is documented thoroughly to ensure clear records are maintained should the matter escalate.
Issue a termination notice for non-payment
If rent remains unpaid after 14 days, the property manager will issue a formal 14-day termination notice in accordance with NSW legislation. This notice includes the overdue amount, outlines the breach of lease, and specifies the vacate date. If the tenant pays in full within the notice period, the notice becomes void.
Property managers ensure the notice is served correctly and complies with all legal requirements.
What if the tenant doesn’t leave? NCAT and next steps
If the tenant doesn’t pay or vacate, the property manager, after communicating with you, will prepare an application to the NSW Civil and Administrative Tribunal (NCAT).
Your property manager will handle all paperwork and represent you at the hearing, presenting evidence such as the lease, rental ledger, and copies of all notices and communication. Their familiarity with NCAT procedures ensures the case is managed efficiently and professionally.
Recovering unpaid rent
After a tenant vacates, the property manager will calculate the outstanding amount and lodge a claim with NCAT for a portion of the bond if necessary. They’ll also assist with lodging a claim through your landlord insurance provider, if applicable.
While recovery isn’t always guaranteed, using a property manager maximises your chances by providing complete documentation and pursuing all available avenues.
Preventing rent arrears in future
A good property manager doesn’t wait for problems to arise. They start by selecting reliable tenants based on detailed background checks and rental history. They use tried and tested systems to track payments and send reminders, and they keep in regular contact with tenants. By setting expectations early and monitoring payment behaviour, they help avoid issues before they escalate.
How a property manager helps from start to finish
From the first missed payment to the final resolution, your property manager is your frontline support. They handle tenant communications, issue legally compliant notices, manage tribunal proceedings, and follow up on compensation and insurance claims, all so you don’t have to.
Unlike self-managing landlords who may be navigating this process for the first time, property managers bring deep knowledge of NSW tenancy laws and years of experience in handling disputes and arrears. This means every step, from notice periods to tribunal evidence, is handled correctly, reducing risk and stress for the landlord.
Property managers also focus on prevention. They screen tenants thoroughly before signing a lease, can provide multiple ways for a tenant to pay rent, and schedule regular rent reviews and inspections. These proactive steps make it far less likely that rent arrears will occur in the first place.
In contrast, self-managing landlords may not have the systems or time to keep on top of these details, increasing the chance of problems going unnoticed until it’s too late.
When it comes to managing rent arrears, a property manager is more than just a buffer; they’re your strategic partner in protecting your investment and ensuring your property stays profitable, even in challenging situations.
Need help managing a difficult tenancy?
Page & Co are experts in rental property management across Sydney’s Northern Districts. If your tenant has stopped paying rent, we can step in and take care of every detail, protecting your property and your peace of mind.
