Proposed changes to the Residential Tenancies Act 1987 (WA)
In 2017 the Government committed to reviewing the Residential Tenancies Act 1987 (WA) (RTA) after more than 10 years of no amendments. A lot has changed over the last 10 years and a review is needed but it is important that the law meets the needs of landlords as well as tenants. It also needs to ensure it is catering for the future, as it could be another 10 years before another review takes place. Currently, most of the proposed changes are favouring the tenants more than landlords and it is important to have your say!
There are quite a few changes that are being proposed and we encourage you to have a look at the submission paper, however, some are listed below for you to have a read through.
Improving security of tenure is one of the focus points in the Department of Mines, Industry Regulation and Safety (DMIRS) consultation papers. To do this, they are proposing a change to the No Grounds termination. When a tenant is on a periodic lease, an owner can, at any time, provide 60 days’ notice to the tenant to vacate the property and not provide a reason for this decision. DMIRS have provided the below alternatives to this termination clause:
Option A – Status quo – Under this option there would be no change.
Option B – Replace no grounds termination with prescribed grounds for termination – The RTA would be amended to remove no grounds terminations.
Option C – Retain no grounds termination but increase the notice period – for example, three months or six months’ notice.
Another proposed change also involves removing fixed term leases completely. If the No Grounds termination is revoked, it has been proposed that fixed term tenancies may not be offered anymore or only offered in limited circumstances. Let’s see what our options may be:
Option A – Status quo – Under this option there would be no change.
Option B – Only open-ended leases will be allowed under the RTA and with the No Grounds Termination no longer an option, landlords won’t be able to simply terminate the tenancy with a 60-day notice period. Adequate grounds for terminating a lease would be amended to ensure it is only provided in appropriate circumstances.
Option C – Fixed term tenancies permitted in only limited circumstances where a period of time is known. For example: perhaps the tenant is on a 12-month employment contract, or perhaps the landlord is moving overseas for 5 years.
Option D – Fixed term tenancies permitted, with tenants entitled to an option to renew for a total minimum period of five years
Option E – Amend the RTA to incentivise the use of longer fixed term agreements
When a tenant applies for a property, they are required to provide an extensive amount of information to ascertain whether they are suitable for the property. The next proposed change suggests that the owner may have to provide similar information to a tenant.
Option A – Status quo – Under this option there would be no change. The ACL and the REBA Code will continue to apply.
Option B – Mandatory disclosure about the premises – Amend the RTA to require a lessor to disclose to any prospective tenant information that is material to their decision to lease the premises. For example, does the landlord plan to sell the property in 6 months’ time, or how does the landlord respond to maintenance in a timely manner.
Option C – Mandatory disclosure about the premises and database of lessor non-compliance. This will allow any tenants to see if the landlord has ever filed for bankruptcy or has any court hearings.
REIWA have lodged a submission to DMIRS in regards to the proposed changes and are advocating for the landlords of WA to ensure the new laws will be fair to all. Celsius sent an email to all our landlords last week with a link to a survey that REIWA was conducting – this survey will collate information and opinions from landlords across WA to present to DMIRS. For further information, please follow the below links.
Kind Regards,