The Queensland Government’s “constant onslaught” of legislative intervention in the state’s rental sector could “kill off” investment, according to the Real Estate Institute of Queensland (REIQ).
REIQ Chief Executive Officer Antonia Mercorella said property investors rights were being stripped away and they were losing confidence in the rental market.
The comments come after the Queensland Government on Tuesday raced legislation through parliament to limit rent rises to just one per year.
The laws come into effect on new and existing tenancies from July 1, but the rental shake-up will not be subject to the normal scrutiny of public consultation or a parliamentary committee.
Ms Mercorella said it was a questionable and concerning move from the Queensland Government, especially as on Tuesday they also announced Stage 2 rental reforms and called for public comment on those.
She questioned the legality of the retrospective nature of the rent rise cap.
“As a property investor, you may have negotiated a rent increase that you have banked on and budgeted for and now this has been stripped away,” Ms Mercorella said.
“It’s one thing to introduce rent control from a certain date onwards, but it’s a whole other proposition to retrospectively create laws that override previously agreed contractual arrangements.”
The new rent cap legislation was passed after being tacked onto an unrelated local government Bill, with Deputy Premier Steven Miles saying the changes would bring the state into line with other Australian jurisdictions and help balance the needs of renters, property owners and investors.
“For most households, rent would be the biggest single expense in their household budget,” he said.
“The government is taking immediate action to support renters now. The majority of landlords do the right thing, but taking immediate action will protect Queensland renters from landlords who aren’t operating fairly.”
Queensland Housing Minister Leeanne Enoch said the rent rise cap was about fairness.
“With more than one-third of Queensland households renting, it’s vital that renters get a fair go,” she said.
“As we seek to modernise Queensland’s tenancy laws, we are determined to strike a fair balance which protects the interests of both renters and rental property owners.
“Acting quickly to limit rent increases is a critical government response to community concerns about the impact of current market conditions and cost of living pressures on renting households in Queensland.
“Taking this action will build on the Queensland Government’s record to improve protections in Queensland’s private rental market through strong, balanced rental law reform.
“In addition to protecting the rights of renters and rental property owners, our rental law reform agenda seeks to improve stability in the rental market.”
The government also opened public consultation on Stage 2 rental law reforms, which cover five key areas:
- making it easier for renters to install safety, security and accessibility measures they need in their rental property
- supporting parties to negotiate about making minor personalisation changes to rental properties
- better balancing of renters’ rights to privacy and quiet enjoyment with property owners’ entry rights
- ensuring rental bond settings provide appropriate security and parties are transparent and accountable about any claims against the bond when the tenancy ends
- ensuring rent payment, utility and reletting fees and charges are fair and reasonable.
Ms Mercorella cautioned the State Government against being heavy handed with the reforms.
She said that contextually this reform comes after repetitious and far-reaching rental reform, and it’s dangerous to underestimate the cumulative impact of that.
“This is not rental reform in isolation, it’s a steady stream of legislative changes – a death by a thousand cuts – that could kill off investment in Queensland,” Ms Mercorella said.
“We’ve already been through COVID-19 eviction moratoriums, and a raft of extensive stage one rental reforms that were centred around strengthening tenant’s rights.
“Then we’ve also seen rent control being sped through parliament in the form of a cap on the frequency of rent increases, and now they’re launching into stage two rental reforms.
“This constant onslaught of legislative intervention has a cumulative effect because it’s continually watering down property investor rights along with their confidence.”
Ms Mercorella said this approach was dangerous because it failed to recognise that private investors are heavily relied upon to provide the majority of housing for the 1.5 million Queenslanders who rent.
“Our state has always had a higher rental population than the rest of the country and so maintaining adequate levels of property investment is vital to housing Queenslanders,” she said.
“As these investors decide to call it a day and either sell or withdraw their properties from our state’s rental pool, the rental crisis here will only get worse.
“When it comes to tenancy legislation, we need to achieve balance and be careful about gradually tipping the scales too far in favour of either party, so that we can provide adequate protections for tenants while keeping investors in Queensland.”
But Ms Enoch said the reforms aimed to provide a strong, balanced approach that protects the rights of renters and lessors, while improving stability in the rental market.
“Many people in Queensland right now are facing housing pressures, none more so than the over a third of Queensland households who rent.
“To tackle these pressures, we’re pursuing Stage 2 rental law reforms which build on the rental reforms we successfully delivered in 2021.
“Our reforms aim to strike the right balance between the needs of the community, while also supporting continued investment in the housing market.
“We welcome input from the public and stakeholders on our Stage 2 rental law reforms and encourage them to have their say over the next six weeks.”
For more information on Stage 2 rental law reform, including how to have your say, click here.