The Real Estate Institute of Queensland (REIQ) fears investors may “tap out” and sell their rental properties as a result of legislation changes due to take effect from October 1.
REIQ Chief Executive Officer Antonia Mercorella said the changes included landlords being unable to refuse pets unless they can establish prescribed grounds and the threat of periodic leases becoming extremely rare.
She said property managers were preparing for a potential surge of tenants seeking approval for pets.
“We recognise that pets are often a beloved family member, but equally appreciate that not all property owners feel comfortable with the potential risk of pet damage to their property and its value,” she said.
“Previously property owners could choose to simply say ‘no’ to pets in their property, but with these new laws, property owners will have limited grounds to refuse a pet request.
“While it’s a silver lining that property owners will gain the ability to impose certain conditions in relation to the approval of a pet in their property, and be able to seek compensation for damage caused by pets, only time will tell if this change will shrink the rental pool if investors tap out.”
This could seriously impact Brisbane’s already low vacancy rate, which currently sits at 0.8 per cent according to CoreLogic data.
Ms Mercorella said it was important landlords’ rights were protected to continue to encourage investment.
“The unfortunate reality is that for some, this will take the shine out of investing in Queensland property,” she said.
“While some property investors may have made the decision to sell in anticipation of the new laws being introduced, it’s concerning to think what the aftermath could be once the laws are in operation.”
Ms Mercorella said another damaging legislative change was the removal of the right for property owners to end a periodic tenancy simply by providing notice.
“Our best practice advice for property managers is to start talking to their clients now about the risk of a ‘never-ending tenancy’ if they don’t transition periodic tenancies to fixed-term tenancies ahead of the new laws.
“We wouldn’t be surprised if periodic leases become extremely rare if not extinct in Queensland, which is a shame given the flexibility it offers both tenants and lessors.”
Ms Mercorella said heavy-handed legislative reform that disrupts the delicate balance of contractual rights between tenants and property owners can have unintended consequences for the entire rental market.
“We can only hope the State Government is paying close attention to the impacts of these new laws, before they launch into the controversial phase two of rental reforms flagged for this year,” she said.
“While we understand that there needs to be protections available for tenants, finding the right balance is important, because we do heavily rely on private investors when it comes to housing Queenslanders.”