Why WA’s rental law overhaul won’t hurt investors
The Real Estate Institute of Western Australia (REIWA) does not believe that new tenant laws will upset the rental market in the state.
Joe White, president of REIWA, is encouraging investors who feel concerned about the impacts of the reforms to “look beyond the headlines and read the legislation”.
White, along with REIWA, was involved during an extended review process, and 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,” he explained.
White, a real estate veteran with more than three decades of experience under his belt, has seen many of the rental market ups and downs, and acknowledged that government policy can sometimes cause big changes in investor behaviour.
“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,” he said.
But with the clarity that these new laws bring to the equation, White does not believe that investors have cause to abandon their plans in Western Australia.
“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,” White commented.
While he acknowledged that some investors have chosen to exit the Western Australian market anyway, he believes they are in the minority.
“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,” he noted.
“The reforms have given the market certainty.”
Ultimately, White believes that Western Australia’s property market is well-equipped to adapt to the change.
“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.”
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