Water bills are one of the most misunderstood expenses in NSW rental properties. Many landlords assume they can automatically pass water usage charges on to tenants. Many tenants assume they’ll never be charged at all.
Under the Residential Tenancies Act 2010, the reality sits somewhere in the middle — and strict eligibility criteria apply before a landlord can recover water usage costs.
If those criteria aren’t met, landlords can be left absorbing ongoing expenses they thought were covered. In regional areas, council billing structures can make things even more complicated.
When Can Landlords Charge Tenants for Water Usage in NSW?
In NSW, tenants can only be charged for water usage (not supply or sewerage) if all of the following apply:
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The property is separately metered (or water is delivered by vehicle).
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The property meets water efficiency standards.
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The tenancy agreement clearly states the tenant must pay for water usage.
If even one of these conditions is not satisfied, the landlord cannot legally recover water usage charges.
The Water Efficiency Trap
This is where many landlords get caught out.
To pass on water usage charges, the property must meet specific efficiency standards, including:
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Shower heads with a maximum 9 litres per minute flow rate
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No leaking taps at the start of the tenancy
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Internal cold water taps and single mixer taps that meet required flow standards
If fittings are non-compliant — even something as simple as an old shower head — the landlord may lose the right to recover water usage entirely.
For older properties in regional markets, this is particularly common. A simple oversight can quietly cost hundreds of dollars per year.
Separate Metering in Regional NSW: Not Always Straightforward
In metropolitan areas, separate metering is standard. In regional centres such as Wagga Wagga and Junee, however, older duplexes or multi-dwelling properties may share meters.
Without separate metering:
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Usage cannot be accurately calculated per tenancy.
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Landlords generally cannot charge tenants for water usage.
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Disputes become difficult to resolve.
Some regional councils also bundle water supply and sewerage charges together, which can cause confusion. Remember: only usage charges can be passed on — not fixed supply or sewerage fees.
Hidden Costs Landlords Often Miss
Even where a property qualifies, there are still overlooked costs:
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Upgrading non-compliant fixtures to meet efficiency standards
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Plumbing inspections to confirm flow rates
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Administrative time reconciling council invoices
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Delays in issuing usage invoices within the required timeframe
If billing is not handled correctly, recovery rights can be affected.
What Tenants Should Know
Tenants are not automatically responsible for water usage.
Before paying:
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Confirm the property is separately metered.
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Check that the tenancy agreement specifies water usage charges.
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Ensure the property meets water efficiency standards.
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Request a copy of the water bill showing actual usage.
If the criteria are not met, tenants may not be legally required to pay usage charges.
Why This Matters in NSW
The Residential Tenancies Act 2010 sets clear requirements around metering and efficiency. Non-compliance doesn’t just create confusion — it can invalidate a landlord’s ability to recover water usage costs altogether.
For landlords, that can mean ongoing hidden expenses.
For tenants, it can mean paying charges they may not actually owe.
Understanding the rules upfront protects both parties and avoids disputes later.
If you manage or lease property in regional NSW, reviewing water compliance should be part of your routine property checks — not something discovered after the first unexpected bill arrives.
