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REIQ says rental reforms may hurt property owners

The Real Estate Institute of Queensland (REIQ) is concerned new rental reforms that were introduced this week hurt the rights of property owners.

According to the REIQ, the Housing Legislation Amendment Bill 2021 that passed Queensland Parliament in recent days will place additional requirements on property owners and could discourage investment.

The Bill removes the ability for lessors to end tenancies without grounds while providing additional reasons for lessors and tenants to end a tenancy.

The Bill also prescribes minimum housing standards, while putting protections in place for renters who face domestic violence issues, as well as more allowances for pet owners.

REIQ CEO Antonia Mercorella said she accepted the new Bill is an improvement on earlier versions but remains concerned it vastly favours tenants.

“The REIQ welcomes the greater statutory clarification the Bill provides in relation to minimum housing standards,” Ms Mercorella said.

“Tenants have an absolute right to feel safe and secure in their homes and these provisions ensure that there is a clear standard for the condition of the premises and its inclusions together with compliance measures to enforce the new standards.

“It is also welcome news that property owners have retained the right to end a fixed tenancy agreement at the end of the agreed term.

“Originally, it was proposed that owners would be stripped of this right and effectively, tenants would have had unilateral right to determine the length of the tenancy agreement.”

Ms Mercorella believes the Bill erodes owners’ rights, specifically surrounding changes to periodic tenancies and pets.

“Property owners have lost the right to end a periodic tenancy by providing notice. Tenants will however retain this right,” she said. 

“Unless owners can establish limited prescribed grounds (such as the sale of the property) they will never be able to terminate a periodic tenancy.

“This is a retrograde step and will almost certainly result in the demise of periodic tenancies in Queensland.

“This reform will detrimentally impact tenants who are seeking maximum flexibility and would prefer not to commit to a fixed term tenancy.”

Ms Mercorella said the legislation took away an owner’s right to not accept tenants with pets.

“Although tenants will still need to seek approval for pets, owners will only be able to decline the request if they can establish prescribed grounds,” Ms Mercorella said.

“On a positive note, the REIQ was successful in advocating for the addition of an important safeguard in these proposed reforms, being the specific exclusion of pet damage from the definition of fair wear and tear.

“This means property owners will be able to seek compensation for damage that’s caused by pets and we believe this will go a long way in giving greater confidence to owners.

“The second important concession that’s been made to the initial proposed reforms in relation to pets is that an owner will be able to impose certain conditions in relation to the approval of a pet in their property.”

Ms Mercorella said she was concerned broad-ranging changes that favoured tenants could cause many investors to simply sell, leading to more rental shortages.

“We know that for some property owners, this Bill will be the final straw and we will see some investors making the decision to sell.

“The ripple effect of this could see renters struggling to find suitable housing under already tight conditions. With the current state of Queensland’s rental market, it’s imperative that we don’t further discourage property rentals at this time.”

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Rowan Crosby

Rowan Crosby is a senior journalist at Elite Agent specialising in finance and real estate.