New reforms for renters have hit our market in WA. Every landlord needs to know and understand the changes that have arrived and are about to hit.
We’ve broken down the key points below, but if you want to fast-track your understanding please view the podcast above.
Please note: The above podcast was recorded on July 4, 2024 – any further updates to the reforms are not included in this video.
Phase One of the Rental Reforms (now apply!)
Rent Bidding Ban
Rental properties now need to be advertised at a set fixed price (rather than a range or a ‘from’ amount). Tenants cannot be pressured by a landlord or agent into offer more than the amount the property has been advertised for advertised.
This change ensures transparency and fairness in the rental market. Here at Davey this is not something we ever felt the need to do as we will recommend advertising at the market rent. Our goal is to find you a great tenant that will look after your home whilst also paying the market rate.
– Rent Bidding Ban FAQ
If a tenant offers more than the advertised amount can I still accept them?
Yes as long as the offer from the tenant was freely given. Its important to ensure that you are in no way suggesting or pressuring that it is something that would help them secure the rental.
What do we do if the tenant asks if they should offer more rent?
As per DMIRS’s advice you should respond to the tenant question (we recommend in writing) something along the lines of “This is a matter for you and not something I want to comment on you need to make your own decision on what you believe the value of the property that you wish to pay.”
Retaliatory Action
Tenants now have the option to apply to court if they believe their landlord/agent is retaliating against them for exercising their rental rights.
– Retaliatory Action FAQ
What would be classed as retaliatory action?
Issuing the tenant with a breach notice (apart from non-payment of rent)
Issuing a rent increase
Commencing termination action
Not renewing the tenancy agreement
If a tenant believes any of the following have been initiated due to them requesting maintenance or making a complaint about the landlord/agent. The tenant would need to apply to court for this as only a magistrate can decide whether the above action was indeed retaliation (“payback”).
Phase Two – Effective from July 29, 2024
12-Month Rent Increases
When these changes come into effect landlords will only be able to increase their tenants rent every 12 months (currently 6).
12-Month Rent Increases FAQ
What if my tenants have already signed a fixed term lease with rent reviews in place before the changes start?
If you had a new lease signed with 6 month rent reviews prior to the changes coming into effect, the conditions of this lease will be honored until it expires, of which then the new laws will apply.
What if my tenants are on a periodic lease? What happens here?
If your tenants are on a periodic lease, the laws will come into effect as soon as the reform is implemented, therefore meaning if you increased the rent in June 2024, you will be not be able to increase the rent again until June 2025.
What if my tenant is on a 6 month lease and I want to review the rent at the end of the tenancy?
You will only be able to increase the rent every 12 months. If a tenant renews their lease every 6 months under this new reform, these instances will be treated as a “continuous agreement” requiring 12 months between increases.
Pets
Tenants will be able to keep Pets at the home (in most cases). Tenants will need to seek permission using an approved form. These forms will have all the appropriate information so that the landlords can make an informed decision. Its important to note that once you receive the form from the tenant you have 14 days to respond and if you do not respond in that time frame it is deemed as your approval.
Pets FAQ
Why has this change happened?
Part of the reason for this change is that many people see pets as part of their family and the uncertainty that tenants face when looking for properties to rent can cause stress because the number of properties they apply for are significantly reduced. There have been cases where tenants have had no choice but to abandoned their pet in order to secure a home.
Can I say no to my tenant having a pet at my property?
Yes you can however you must have reasonable grounds to do so. Eg: The strata bylaws, local laws or written law do not allow Pets.
If the above does not apply then you will need to make an application to the commissioner to provide reasonable conditions to refuse and then the commissioner will make a decision based on this. The tenant can also provide a submission to contest this.
If I say yes to a Pet, can I have special conditions?
Yes you can propose conditions such as the number of pets, cleaning, maintenance and fumigation. Dmirs will have “prescribed” conditions that will be released once the changes have come into effect. If you want to put a condition for the tenants having a pet that does not fall in line with the above then you will need to make an application to the commissioner.
What happens if the Pet damages my property?
The tenants are responsible for repairing any damages caused by their pet and if they do not do this by the end of their tenancy you can propose this in a bond deduction.
Currently in WA you can hold a pet bond of $260 and this can only be used for fumigation. It is estimated that early 2025 the $260 pet bond may be used for damages if required.
Minor Modifications
This change that is coming into effect is to help make a tenants house that they are renting feel more like home. Tenant will be allowed to make small changes (in most cases).
DMIRS will be releasing a list of of minor modifications that will be allowed under this new change – it has not been finalised as yet though.
Tenants will be responsible to “make good” on any changes unless the landlord says its fine to leave it.
– Minor Modifications FAQ
What kinds of changes can the tenant make?
There will be a list released when the law takes effect of what would be deemed as a minor modification. It will likely be things such as: Picture hooks, window fittings, flyscreens and adhesive child safety locks.
Can I say no to my tenants request of making minor modifications?
Similar to the pet change – you will need to have reasonable grounds to refuse a modification.
You can refuse if the modification would disturb material containing asbestos, a written law or scheme by-laws prohibit making the modification or if your property is heritage listed.
In other circumstances where the modifications could result in costly damage, make the property unsafe, or reversing it is not practical, you will need to apply to the commissioner for refusal.
Does the tenant need to remove any changes they make at the end of their tenancy?
Yes – unless you agree for them to leave it. The tenant either needs to return it back to its condition prior to their change (taking into consideration fair wear and tear) or pay a reasonable amount to restore it.
Phase Three – Estimated to come into effect the first half of 2025
Bond Release
Currently only the landlord/agent can submit a disposal of bond online form. If an agreement cannot be reached between the landlord and a tenant in relation to the monies being claimed one of the parties will need to apply to the magistrate court.
The new reform is likely to be released in the first half of 2025 the changes that will be made are that either a tenant or a landlord can request the release of the bond. Once this is initiated Bonds Admin will inform all parties about the application. If all parties agree, the bond will be disbursed accordingly.
If an agreement is not reached between the landlord and tenant, the Commissioner for Consumer Protection will intervene, hear both sides, and make a final decision.
– Bond Release FAQ
Will this make it harder for me to claim bond monies if the tenant damages the property?
The rules for landlords claiming bond money won’t change. If there are issues like property damage or unpaid rent, landlords can still seek to deduct these costs from the bond.