Hi, I understand co sleepers are not recommended as there are no AU standard regulations. However it is advised sleeping in the same room for the first 6 months. What are our options if our bedroom is not big enough to fit a cot ?

Bassinets can be used until baby is rolling.
Red Nose has some information on the use of bassinets in those early weeks/months.

Product Safety Australia (ACCC) develop & monitor all safety standards in Australia.
New Mandatory Safety Standard for bassinets, was introduced this year, but business have until Jan 2026 to comply
This information van be found on their website:
https://www.productsafety.gov.au/consumers/keep-baby-safe/settle-baby-to-sleep-safely/bassinets-and-cradles-guide

The information provided is related to stability, risk of falls, height of sides, mattress size, brakes on wheels.
If you are using a bassinet with roll down sides (co-sleeper) ensure the side is up when baby is sleeping.
Have a look at this info & let me know if you have further questions.

Most babies are rolling between 4-5 mths of age.
If your baby is rolling before 6 months of age & you need to move to a cot then Red Nose recommends (#5) to use a portacot for a short time or transfer to their standard cot in baby’s room.
When you wake during the night, check on baby in their room.
The safety of the baby’s sleep environment takes priority over room sharing.
https://rednose.org.au/article/what-steps-can-i-take-to-sleep-my-baby-safely