More changes have been promised to protect people fleeing domestic violence amid concerns tenancy tweaks will not increase housing and could discourage investors in Australia's most expensive property market.
Laws to end no-grounds evictions in NSW - a key election promise for the incoming Labor government - will ensure greater stability for tenants after the legislation passed state parliament late on Thursday.
But industry groups have criticised "anti-landlord" policies they say will prompt investors to sell up.
Other changes tighten existing requirements, limit rental increases to once a year and prevent landlords a blanket rejection of pets.
Fair Trading Minister Anoulack Chanthivong said the government was not done with its reforms of the rental market.
"We'll be addressing issues around domestic violence, but also ... to ensure that we are actually able to protect renters' data and their personal information," he told reporters on Friday.
Animal Justice Party MP Emma Hurst said the changes had not made it any easier for tenants with animals and people often delayed leaving domestic-violence situations due to the struggle of finding housing with pets.
"It is likely with the weak bill put forward that the status quo remains and it will continue to be nearly impossible for most tenants to find animal-friendly housing," she said.
Ms Hurst moved several amendments, including a successful one to ensure tenants could keep their allowed pets if a landlord changed.
She said the bill was a disappointment that gave wide discretion to landlords to refuse animals or impose excessive conditions.
The headline change is a long-awaited ban on no-grounds evictions, which Labor and the coalition both promised before the 2023 state election and which tenancy advocates say is fundamental to support any other reform.
Some reasonable grounds remain, including landlords or their family members moving in, renovations and sales.
Greens MP Jenny Leong, who introduced previous bills to end no-grounds evictions, appreciated the state finally delivering a ban.
"With more and more people set to rent for life these changes start to correct the power imbalance between landlords and renters by giving tenants the security and stability they need to plan their lives and set down roots in a community," she said.
However, Real Estate Institute of NSW chief executive Tim McKibbin said the changes were "anti-landlord".
"Investors have other less risky and less troublesome avenues in which to invest and every time an investor sells, another rental property is lost to the market," he said.
There was a risk that some former rentals could be converted to short-term holiday accommodation, an issue Housing Minister Rose Jackson said the government was still investigating.
"It is an area where we're looking to do more, but we're just working through the process of exploring what those options might look like," she said when asked about a potential levy on short-term rentals that could mirror one recently introduced in Victoria.
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