Rental reforms a lesson in what not to do

With most states divided on how to effect rental reform, the latest changes from this big taxing Labor government are a lesson in what not to do.

The promise of delivering rental reform for tenants is proving problematic for the NSW government. But that might be a good thing.

It seems the delay from Fair Trading Minister Anoulack Chanthivong is due to the complexity of modernising the 2010 Residential Tenancies Act.

The overriding quandary is how far can the government go to satisfy the understandable needs of renters seeking dignity and longevity without triggering an exodus of investors, and an accompanying rise of homelessness.

That sad scenario is underway in Victoria where the big taxing Labor government went further this week in its seven year reform process with plans to force landlords to install efficient insulation, draught-proofing, cooling and heating systems, plus efficient shower heads.

Rental reform has stalled in NSW. Picture: Tim Hunter.

The costly proposal involves staggering implementation from October next year with the upgrading required at the start of any new lease thereafter.

The state bureaucracy concedes that Melbourne’s rental supply may contract.

PropTrack economist Paul Ryan recently noted at the start of the pandemic, 37 per cent of capital city rental properties cost less than $400 a week. It was down to 10 per cent by early 2023, and Melbourne saw the largest decline in rental availability in the year to April this year.

So with the rental crisis deepening, the NSW government faces the challenge of its election commitment to end no-fault evictions. None of the states that have moved on no-fault have the same legislation as there’s no one-size-fits all solution.

The government’s consultation found 96 per cent of renters supported the landlord needing a permitted reason to end a periodic lease, but only 28 per cent of owners and 12 per cent of estate agents were in support.

The big taxing Victorian government has put expensive new laws in place for landlords. Picture: NCA NewsWire / Ian Currie

That is a big gap in outlook as was witnessed recently in the debate surrounding the decision of Prime Minister Anthony Albanese in giving notice to his tenant in Dulwich Hill.

Allowing pets in tenancies was designated by the NSW Rental Commissioner Trina Jones as a “priority”.

Her enthusiasm came after the government’s consultation process saw 93 per cent of renters wanting it to be easier, compared with 28 per cent of owners and 24 per cent of agents.

Jones thought the legislation would come early 2024.

Even legislation that passed parliament last June has languished with the government’s portable rental bonds scheme yet to be set up given issues around implementation.

Anthony Albanese is evicting his tenant amidst the worst rental and cost of living crisis. Jim Flanagan who has been given an eviction letter, at the Dulwich Hill rental. Picture: Jonathan Ng

Labor frontbencher Ron Hoenig told parliament last month that the government remained committed to introducing “measured and sensible reform to support renters”.

“But as a responsible government, it is critical that any reform does not result in detrimental outcomes for the people it is intended to protect.

“This goes for potential impacts in the short term and further in the future,” Hoenig said.

Originally published as Rental reforms a lesson in what not to do