Apartment overcrowding rules: occupancy limits NSW

NSW is the only state with an express strata power to cap occupancy: section 137 of the Strata Schemes Management Act 2015 (NSW).
The cap must be at least 2 adults per bedroom, and only applies if the owners corporation has adopted the by-law.
"Bedroom" means a room approved or shown as a bedroom in the planning approval plans, and "reside" can be defined by regulation.
NCAT can fine a breach of an occupancy by-law up to 50 penalty units, and up to 100 for a repeat breach within 12 months.
Councils deal with illegal use and safety risks through orders under the Environmental Planning and Assessment Act 1979 (NSW).

Can a strata scheme limit how many people live in an apartment?

In NSW, yes, but only by by-law and only within limits. Section 137 says a by-law "may limit the number of adults who may reside in a lot by reference to the number of bedrooms", and "the limit may not be fewer than 2 adults per bedroom" (Strata Schemes Management Act 2015 (NSW), s 137). NSW Government guidance on short-term rentals confirms owners corporations "can introduce an occupancy limit of 2 adults per bedroom using a by-law" (NSW Government).

What section 137 says, in plain English

Subsection	Rule
s 137(1)	A by-law may cap adults residing in a lot by reference to the number of bedrooms.
s 137(2)	The cap cannot be fewer than 2 adults per bedroom.
s 137(3)	The by-law has no effect if inconsistent with a planning approval or other law that applies to the lot, or in other circumstances prescribed by the regulations.
s 137(4)	NCAT can make orders about an occupancy by-law.
s 137(5)	Regulations may say when a person counts as a resident.
s 137(6)	A bedroom is a room approved for use, or shown, as a bedroom in planning approval plans, plus any room prescribed by regulation.

Children are protected too: a by-law for a residential scheme cannot prohibit or restrict people under 18 occupying a lot, except in retirement villages or housing for aged persons (s 139(4)). Section 137 caps adults only.

How is an occupancy by-law made and enforced?

Make it. The owners corporation changes its by-laws by special resolution at a general meeting (s 141(1)), then lodges a notice with the Registrar-General within 6 months. The change has no effect until it is recorded (s 141(2)–(3)).
Tell residents. Tenants must receive the by-laws from their landlord or agent before signing a lease, and a new copy within 14 days of a change (NSW Government – By-laws).
Notice to comply. If the owners corporation is satisfied there is a breach, it can issue a notice to comply in the approved form, after a resolution approving it by the owners corporation or committee (s 146).
Tribunal penalty. If the breach continues, NCAT can impose a penalty. For section 137 by-laws, the maximum is 50 penalty units, or 100 penalty units for a repeat breach within 12 months of a previous penalty (s 147(3)).

A by-law must also not be "harsh, unconscionable or oppressive" (s 139(1)), and NCAT can declare such a by-law invalid (s 150).

What can the local council do?

Strata by-laws are only one tool. Under Schedule 5 of the Environmental Planning and Assessment Act 1979 (NSW), councils can issue a Stop Use Order when premises are used for a prohibited purpose, without a required planning approval, or in breach of one, or when a building is used inconsistently with its classification in a way likely to be a life-threatening hazard or a threat to public health or safety. If that order is ignored, an Evacuate Premises Order or Exclusion Order can follow (EP&A Act, Sch 5).

In practice, that means an apartment run as an unapproved boarding house, or one with bedrooms partitioned into living space that blocks fire exits, is a council and fire safety matter as much as a strata one. Report imminent safety risks to the council and, in an emergency, to 000.

What about other states?

We did not find an equivalent express strata occupancy-cap power in Victoria, Queensland, WA, SA, Tasmania, the ACT or the NT when we checked official sources for this guide. Overcrowding there is usually dealt with through general by-laws or rules about noise, nuisance and use of common property, local council planning and building controls, fire safety laws, and residential tenancy laws. Check your own scheme's by-laws and your state's strata Act; see our state-by-state guide for the right Act.

How can buildings monitor occupancy fairly and privately?

Overcrowding concerns can easily become discrimination or snooping. A fair approach:

Start with the by-law. If there is no s 137 by-law, there is no strata occupancy cap to enforce in NSW.
Use lawful records. NSW landlords or agents must notify the owners corporation of a lease within 14 days, including the tenant's name and start date, so the strata roll is up to date (NSW Government – Record keeping).
Count by approved bedrooms. Use the bedroom count in the approved plans, not a guess based on furniture or deliveries.
Treat flags as prompts, not verdicts. A high number of registered residents or access cards should lead to a polite query, not an accusation.
Limit access. Only the building manager or committee members who need to act should see resident details. Committee members must only use or disclose owner information as their role or the law requires (s 37(1)(c)).
Remember children and relatives. Section 137 caps adults only, and children cannot be restricted by by-law.

How Watchdog Strata helps

Watchdog Strata's residents and tenants register lets owner-occupiers add and remove their own tenants with manager approval, and flags when registered occupants exceed a building's per-bedroom setting (default 2 per bedroom). That setting is a building policy, not a law. Integrity alerts highlight duplicate or mismatched registrations for a manager to check privately.

General information only, not legal advice. Check the current legislation or ask a strata lawyer for your scheme.

Questions people ask

How many people can live in a 2-bedroom apartment in NSW?

There is no general strata cap. If the owners corporation has made a section 137 by-law, it can limit adults by bedrooms, but not below 2 adults per bedroom, so a 2-bedroom lot could not be capped below 4 adults. Children cannot be restricted.

Can strata ban more than two people per bedroom?

In NSW, a by-law under section 137 of the Strata Schemes Management Act 2015 can set a limit of no fewer than 2 adults per bedroom. It has no effect if it conflicts with a planning approval or other law.

What is the fine for breaching an overcrowding by-law in NSW?

After a notice to comply, NCAT can impose a penalty of up to 50 penalty units, or up to 100 penalty units for a repeat breach within 12 months, under section 147(3).

Who do I report a dangerous overcrowded apartment to?

Tell the building manager or strata committee, and report safety or illegal-use concerns to the local council, which can issue orders under the Environmental Planning and Assessment Act 1979 (NSW). In an emergency, call 000.

Apartment overcrowding and occupancy limits: what strata can and can’t do