Queensland Law Society holds some reservations about the Department of Housing’s discussion paper, Ensuring the annual rent increase frequency limit is effective.
QLS provided feedback on the discussion paper last week with the input of members from the Property and Development Law, and Competition and Consumer Law Committees, and with the benefit of considering the draft submission by Kristan Conlon and Emile McPhee from McCullough Robertson Lawyers.
From 1 July 2023, the limit on the frequency at which rents could be increased was extended from once every six months to once a year for new and existing tenancies.
The discussion paper seeks input on further reform which aims to ensure the annual rent increase frequency limit achieves its policy intent and to prevent the reported emerging practice of ending tenancies with existing renters and entering shorter leases with new renters at a higher rent to avoid the annual rent increase frequency limit.
QLS recognises the significant challenges for the Queensland community in accessing and maintaining housing and the government’s role in developing appropriate policy responses.
The reservations centre on the discussion paper’s proposal to apply or link the rent increase frequency limit to the rental property rather than the tenancy.
Potential unintended consequences include: the impact on community housing providers and other property owners who determine rent based on a tenant’s income; and an increase in tenancy agreements containing special conditions authorising rent increases during the term of the tenancy, to allow for an increase after 12 months from the previous increase in accordance with this policy.
Also the reform may result in reduced availability of rental stock as property owners seek to align tenancies with the proposed rental increase requirements.
QLS is supportive of the proposal that any reforms would not apply retrospectively for the reasons listed in the discussion paper.
It highlights the need for additional funding for the Residential Tenancies Authority to ensure it has sufficient resources to undertake any increased compliance responsibilities arising as a result of these reforms; and additional legal assistance funding in the current environment to assist tenants to resolve disputes quickly and appropriately, given the complex social consequences of homelessness and insecure housing.
QLS is supportive of the government considering a range of policy reforms and urges it to continue to assess all possible options to respond to the housing and related cost-of-living pressures.
It holds the view it is too early to determine the true impact of these reforms on the rental market, and notes the government’s recent review on short-term accommodation found dwelling stocks were a significant contributor to rental price increases.
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