That’s the gist of some of the comments we’ve seen following the passing of the Residential Tenancies Amendment Act 2024 last month.
We don’t agree.
Legislation can certainly impact investors, leading them to leave the market. That was the case following the COVID-19 moratoriums. Uncertainty about legislative change can also cause investors to exit the market, and again this happened in the lead up to these rental reforms, which commenced with a review in 2019 and were finally announced in May 2023. Four years is a long time for investors to be wondering about potential change.
During the extended review process, REIWA strongly advocated for an approach that balanced the rights of tenants and landlords.
Investors made it quite clear to us that they needed to maintain some control of their asset.
Tenants meanwhile wanted the ability to make the house they rented a home and protections from rent bidding and frequent rent increases.
We think the reforms have achieved this balance.
Investors retain the right to end a tenancy with no grounds, and I remind tenants and property owners that there are proper processes for ending tenancies.
Meanwhile, there are new provisions for tenants to seek remedy or compensation from a court if they feel the property owner has taken retaliatory action against them for exercising their rights as a tenant, such as by increasing the rent or ending a lease after the tenant has made a complaint to Consumer Protection. Tenants already have the right to seek remedy or compensation if action has been taken to evict them after exercising their rights.
The new laws have checks and balances. Tenants will be able to have pets and make minor modifications in most circumstances. However owners will be able to refuse pets on certain grounds, such as the home is in a strata complex that doesn’t allow pets. And if a tenant paints the house purple because that is their favourite colour, they will need to rectify that when the lease ends.
Yes, investors are still leaving the market, and some will do so because of the new laws. But the reforms have given the market certainty. Data from the Australian Bureau of Statistics shows there has been an increase in investors buying in WA and this has happened since the reforms were announced last May. These investors knew this was coming and were still willing to invest.
Our industry has been through significant rental reform before. We adapted then and we will adapt now, and in 12 months we’ll all be wondering what the fuss was.
I encourage people to look beyond the headlines and read the legislation. You can find factsheets breaking down the changes for tenants and owners.
Joe White
REIWA President
