REINSW: A Dark Day for Renters

The rental reforms passed by the NSW Parliament yesterday have been disingenuously sold by the Government as a win for renters. The reality is renters will feel the adverse impacts more than anyone else, says the Real Estate Institute of NSW (REINSW).

“In recent years, the wave of anti-landlord reforms and rhetoric coming from Government have made it increasingly difficult to make the case to invest in residential property in New South Wales. It just got considerably harder and renters are the ones who are bearing the brunt,” REINSW CEO Tim McKibbin says.

“The proof is clear for all to see. Vacancy rates are incredibly tight, demand is far outweighing supply which directly contributes to higher rents, investors have become net sellers, removing rental properties from the market and affecting the feasibility of new developments, and this exacerbates the housing supply shortfall.

“Anti-landlord policies adversely affect tenants more than landlords. Investors have other less risky and less troublesome avenues in which to invest and every time an investor sells, another rental property is lost to the market. Increased rents are a direct outcome of decreased rental supply.

“These reforms are being sold as a win for renters. The available evidence shows this is false. This is a dark day for renters in New South Wales,” he says.

According to the REINSW, the reforms will have serious impacts on the rental market:

• They will further reduce rental supply at a time when demand is increasing rapidly;
• As such, further upward pressure will be placed on rents;
• Investors wanting to recover possession of their property at the conclusion of the current fixed term lease will be encouraged to expedite this process;
• The reforms undermine the notion of a fixed term agreement, ignoring a fundamental understanding of the relationship between a tenant and a landlord.

Victorian Government data shows the number of rental properties in that state fell by nearly 22,000 this year, coinciding with similar anti-landlord legislation.

In New Zealand, the 2021 ban on so-called ‘no grounds’ evictions had such a significant impact on reducing rental supply that a Bill to reinstate a landlord’s right to take possession of their property was introduced this year.

The NSW Government had the opportunity to heed these lessons, Mr McKibbin says.

“The new reforms counteract the most basic, self-evident solution to the rental crisis. We desperately need more properties to rent. Instead, Government has chosen to make it less attractive to invest in residential property. Fewer rental properties mean fewer choices for renters and a worsening rental crisis,” Mr McKibbin says.