An Overview of Recent Government Announcements
Proposed Changes to the RTA
The West Australian government has introduced important legislation to Parliament this week regarding long-term rentals, which we have heard a lot of discussions about in previous months. The changes are yet to be passed, so we will need to wait and see the outcome once the legislation is voted on in Parliament. It is important to remember that there will be further clarification in relation to the below changes as well, and the legislative process will provide detailed guidelines to us in time on how each item will be implemented. If the legislation passes, the changes will likely come into effect in stages from next year, so it could be a while before we see them enacted.
The proposed changes include:
- Tenants being allowed to keep pets
- Changes to the scope of pet bonds
- Tenants will be allowed to make minor modifications
- Rent increases will be limited to every 12 months
- Changes to the bond disposal process
- Prohibition on rent bidding
Government Changes to Short Term Rental Market
The government has also recently announced important changes to short term rentals in order to regulate this market and boost long term housing supply. Short stay accommodation has become increasingly popular over the last few years, with many long-term rentals being converted to short stay rentals due to the income potential. We are seeing many prospective tenants, especially those new to WA, staying in expensive short term rental accommodation whilst they try and secure a home. There is potential for the reform to make an impact on the supply issue in WA, and this could be the case even if only a small percentage of hosts make the switch from short term to long term. We will wait in anticipation to see the results of this government initiative.
These changes include:
- $10,000 offering to owners to lease their properties for a minimum 12 month lease term to new long term tenants for a maximum of $800 p/w in Perth and $650 p/w in Southwest WA. (To be eligible, the property owner must have had the entire property for rent on a short stay booking platform within the previous 6 weeks).
- Local government approval required for unhosted short-term rental accommodation that operates for more than 90 nights in 12 months (Perth region)
- Local governments will determine if planning approval is required for short-term rental accommodation (Regional WA)
- Short-term rental providers required to register their properties before being able to advertise and take bookings from online platforms.
Government Announcement Regarding Rental Relief Program
The WA government has also announced a new program designed to assist tenants who may be at risk of eviction due to rental arrears. There is the possibility of a one-off payment of up to $5000 per household, and in some cases up to 50% of 3 months future rent paid through a co-contribution model. Tenants can enquire about the program online however there is a process that needs to be followed in order to be eligible, with the involvement of community organisations and assessments conducted before a person is granted rental relief. Payments from the program will be paid directly to the Property Manager/Landlord. As this is a new initiative, we will need to watch and wait to see how this is implemented in practice over the coming months.
Regards,
The Celsius Property Management Team