On Thursday, Commerce Minister, John Quigley announced the emergency period has been extended to Sunday 28 March 2021; with some revisions and various relief measures expected to continue to apply up until this date.
So, what does this mean for you?
In case you aren’t aware, the Act restricts residential landlords from evicting tenants who are not meeting their rental payment obligations, and prevents landlords from increasing rent on tenants as long as they’re occupying the property during the period (yes, this even applies to situations where rent renewals are taking place).
Although this effort has been made to protect tenants who are facing hardship, there’s an industry frustration at this blanket approach as it is not an equally reflected response to WA’s current situation. The extension does however protect tenants whose government assistance may be reduced in the coming months or tenants who may potentially find themselves out of employment as a result of their employer no longer being eligible to receive Job Keeper
Nicole Hazell, Divisional Leader of Property Management here at Realmark Urban commented on how this announcement affects Perth property investors.
“There are concerns expressed across the industry that this is artificially holding back prices, and although it may hold back rent increases in the interim, we may experience a significant spike in rent prices next year when the memorandum is lifted - which may have the opposite effect than how it was intended (to protect tenants),” said Nicole.
“We acknowledge that it can also be frustrating for landlords, as this means they are unable to take advantage of Perth’s strong rental market after years of recalibration.
“On the flip side, properties being rented right now are in high demand; receiving multiple offers and often leasing in excess of 50 dollars higher than rented previously; in a lot of cases above the advertised price.
“Tenants are frustrated with the lack of options and the high competition levels, with quality tenants missing out on multiple properties before being successful in finding accommodation.
“The silver lining is that if you’re acquiring investment property right now or find yourself in a position where your tenants are relocating, there’s opportunity to lease your property for a great price with quality tenants to choose from,” she commented.
The future of the Perth rental market is still indicating positive signs, although this announcement has affected short-term rent growth.
You can view the Government’s announcement here and view the reaction from REIWA here. It’s expected there will be further announcements made in the coming weeks and we will keep you up to date with announcements and changes as they arise.
We continue to implement strong processes in accordance with these laws and guidance to ensure we support our landlords as best we can during these ever-changing times. We encourage you to seek legal advice and advice from your accountant in regards to your unique situation.
Over 30 years, our dedicated and experienced team have operated through six cycles in the property market and are here to support you with any property management, sales or leasing enquiries you may have.