Tenants will be given a six-month transition period to pay off balances accrued during the pandemic and set up payment plans with landlords.

But one regional NSW housing advocate has cast doubt on whether the new support goes far enough.

The NSW government has announced the measure ahead of the March 26 end to the moratorium on evictions, and the requirement for landlords and tenants to negotiate rental payments.

Minister for Better Regulation, Kevin Anderson, said tenants in arrears would have time to plan for how they would pay them down.

"With the economy rebounding and the unemployment rate stabilising, the time is right to transition back to normal tenancy laws, Mr Anderson said.

Tenants can only be evicted if they fail to meet the terms of their payment plan.

The laws will also mean tenants can't be blacklisted on databases for being in arrears.

'Better than nothing'

Tenant advocates have welcomed the extra time, but have warned landlords may still have the upper hand in negotiations.

Kerrie-Ann Pankhurst from the Armidale-based New England and Western Tenants Advice and Advocacy Service said a six month transition was "better than nothing", but wants to see more detail on the legislation.

She is concerned landlords may deliberately offer a payment plan a tenant will struggle to meet, and has questioned if the laws will guard against that.

Ms Pankhurst said she had spoken to several clients fighting to secure affordable accommodation, and a 12 month transition would be better.

"I was talking to someone last week, he's got a disabled son, 22 years old, they were moving into their car," she said.

"These are not uncommon stories that we see, and the struggle for people to find new housing is so exacerbated by the tightening in vacancy rates."

"We're starting to see the wave approaching now."

Tenants outside Sydney are especially feeling the pinch, as vacancy rates plunge to less than 1 per cent in areas like Coffs Harbour and the Central Coast.