February 16th, 2020
What’s changed: New NSW Residential Tenancy Laws
The Queensland government recently proposed a number of changes to Queensland’s tenancy laws to ensure safety and fairness in the community. The three key areas of reform are safety and security, protection against domestic violence and protections if renting with pets.
Here’s a summary of the proposed changes:
First and foremost, the proposed changes abolish a landlord’s right not to renew a tenancy agreement at the end of its agreed term. Landlords can only end a tenancy for approved reasons such as:
The reforms also introduce minimum housing standards and repair and maintenance obligations. If the rental property doesn’t meet minimum standards, it cannot be rented or rent must be reduced until maintenance is completed, which can mean loss of income for landlords.
Tenants will have seven days to complete and return the entry condition report and they will be able to authorise up to four weeks’ rent for emergency repairs, instead of the current two weeks’ rent. If the landlord is unavailable, the property manager will be able to authorise up to four weeks’ rent for emergency repairs.
Additionally, tenants do not have to obtain landlord permission to make minor modifications to the rental property for health, safety, security and accessibility reasons. This includes adding deadlocks, grab rails and furniture anchors. While tenants must inform the landlord of any changes, landlords can only refuse the changes by obtaining an order from QCAT.
Lastly, landlords cannot unreasonably refuse a tenant’s request to keep a pet unless the property is unsuitable for the pet or there are unacceptable health or safety risks. However, landlords can require the tenant to meet special conditions such as paying a pet bond.
The Real Estate Institute of Queensland (REIQ) has been petitioning against the reforms since their announcement as a third of dwellings in Queensland are investor owned, and thus the changes have “the potential to destroy Queensland’s rental market”.
REIQ CEO Antonia Mercorella has called the proposed reforms a “slap in the face to every day mum and dad property owners” and predicts a decline in investor activity that could negatively impact rental supply and vacancy rates.
“Under the reforms, landlords will see their fundamental rights eroded, making property investment far less appealing, and as a result, we’ll almost certainly see investment levels drop,” said Ms Mercorella.
According to Deputy Premier, Treasurer and Member for South Brisbane Jackie Trad, more than a third of Queensland households live in rental properties, with the figure rising to three in every five in some areas like the inner city. This means that the proposed changes affect a large number of people in the Sunshine State.
The abolishment of without grounds terminations and evictions, introduction of minimum housing standards and improved domestic violence protections aim to make renting safer and more secure for tenants. Existing repair and maintenance provisions will be enhanced and tenants experiencing domestic and family violence will be able to install security measures and provide seven days’ notice to exit a tenancy and leave quickly or immediately.
The reforms also introduce the right for tenants to make minor modifications for health, safety, security and accessibility reasons without landlord consent. These modifications must be carried out by a qualified tradesperson when required and any damage incurred must be repaired. Conversely, personalisation, energy efficiency and communication service connection changes such as hanging pictures or cable television connections still require landlord consent.
Tenants with pets will have increased access to rental properties as landlords cannot unreasonably refuse a tenant’s request to keep a pet. However, landlords can require the tenant to meet special conditions such as paying a pet bond or paying for professional pest control or carpet cleaning at the end of the tenancy. If the pet has caused any damage to the rental property during the tenancy, the tenant will be held responsible.
On the other hand, the proposed reforms will likely inflate rents for tenants due to an eventual decline in housing supply. As conditions become more unfavourable for landlords in Queensland, existing investors may sell their properties and investor activity will likely decrease. This will negatively impact the construction sector and those working in the real estate industry may face unemployment.
According to analysis by Propertyology Head of Research Simon Pressley, “reforms could cause rents to skyrocket by $100 a week” or $5,000 annually over the next two years due to the inevitable decrease in investor activity, subsequent domino effect and eventual decline in housing supply.
Minister for Housing and Public Works, Mick de Brenni acknowledged that he believed the reforms would likely increase weekly rents by 5%, from an average of $360 per week to $378 per week.
“With many existing owners of Queensland investment properties already disappointed by the poor financial performance of their asset, this new legislation will be the final straw for some owners,” Mr Pressley said.
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