NSW Premier Dominic Perrottet says solicited rent bidding – where real estate agents suggest prospective tenants offer a higher price on a rental property to better their chances of securing the lease – will be banned.

“For too long, particularly in a tight market, we’ve seen these auctions occurring from real estate agents across the state,” he told reporters on Monday.

“From Saturday that will no longer be the case.”

However, the regulations stop short of banning unsolicited offers from tenants – meaning people at inspections can still offer a higher price to secure the lease – so long as the agent does not entice it.

Prospective tenants who are encouraged by real estate agents to up their offers will be able to report agents to the Department of Fair Trading.

Offending agents will be subjected to fines of $5500 for an individual and $11,000 for a corporation.

Fair Trading Minister Victor Dominello said the reform would protect vulnerable renters.

“We appreciate there are vulnerable renters out there that are just doing their best just to get a roof over their head,” he said.

“The last thing we want is a feeding frenzy of activity when the market is so hot.”

It comes after NSW Labor announced it would seek to legislate an end to rental bidding.

The government said it would not have parliament return to make laws on the issue, preferring to have regulations in effect by the weekend.

The promise ahead of the March election comes amid skyrocketing Sydney rents as well as those in regional areas, with NSW’s median rent increasing from $386 to $420 a week between 2016 and 2021.

-AAP