Phase 2 of the Residential Tenancies Act amendment, recently enacted by the WA Parliament, will come into effect on 29 July 2024. This phase introduces significant changes across three main areas that will impact both property investors and tenants.
- Rent Increase Limitations
Under the new regulations, property investors in WA will be restricted to raising rents only once every 12 months, effective from 29 July 2024. Previously, investors could increase rents every six months, a practice that proved beneficial over the past two years amid rising interest rates set by the Reserve Bank. This adjustment will apply to both periodic lease agreements (without a fixed end date) and fixed-term leases signed on or after 29 July 2024. However, any fixed-term lease agreements entered into before this date can still include six-month rent increases, with the new 12-month interval applying only once the current lease expires.
- Regulations on Pets
The new laws address the contentious issue of pets in rental properties. Tenants must now formally request permission to keep a pet, and property investors can only refuse this request if it is deemed ‘reasonable.’ Reasons for refusal may include the absence of pet-friendly fencing or compliance with specific laws, such as strata by-laws. Investors can also impose ‘reasonable conditions’ on pet ownership, such as limiting the number of pets or requiring certain maintenance practices. A pet bond can be collected in addition to the standard bond to cover any potential damage caused by pets. However, the expanded scope of this pet bond will not take effect until early 2025, when the new bond disposal process is implemented.
- Tenant Modifications to Rental Properties
From 29 July 2024, tenants will be permitted to make ‘minor modifications’ to rental properties with the investor’s consent. These modifications include installing picture hooks, mounting shelves, replacing shower heads with water-efficient models, and adding window coverings. Tenants can also undertake various safety improvements, such as installing child safety locks and flyscreens, and establishing vegetable or herb gardens.
For modifications that fall outside this ‘minor’ category, such as installing lever-style taps, phone or internet connections, or painting rooms, investors can require that the work be completed by a qualified tradesperson without needing Commissioner approval. The regulations stipulate that tenants may need to provide a copy of the invoice for such work. REIWA’s advocacy for professional painting has been recognized, as the regulations now require painting to be performed by a professional.
Investors can only refuse modifications listed as allowable changes for specific reasons, including compliance with strata rules, potential disturbance of asbestos, or breach of heritage listings. For other refusals, investors must present valid reasons to the Commissioner for Consumer Protection, such as safety concerns, increased maintenance costs, or if the cost of reversing the modifications exceeds the bond amount.
At the end of the tenancy, tenants are generally required to restore the property to its original condition unless an agreement is reached with the investor or agent for the modification to remain, such as a painted wall.
These changes reflect a shift towards balancing the rights and responsibilities of both tenants and property investors, aiming to foster a fairer rental market in Western Australia.
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How can we help?
If you have any questions or would like further information, please feel free to give our office on 08 9221 5522 or via email – info@camdenprofessionals.com.au or arrange a time for a meeting so we can discuss your requirements in more detail.
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