Finding tomorrow’s hot property, TODAY

Rent Crisis: Law Changes Deter Investors

Rent Crisis: Law Changes Deter InvestorsThe impact of mum and dad investors on the property market is growing – with over 90% of rental properties provided by private investors – but many are willing to sell up if significant changes are made to residential tenancy laws.

A number of state governments have made or are considering changes to tenancy laws, such as allowing modifications to properties without owner permission and removing the owner’s right to end a tenancy unless on prescribed grounds.

A survey of 7,000 investors by Synergies Economic Consulting says 61% of investors are likely to sell their investment property if such significant changes are adopted.

This could result in many mum and dad investors (small scale, non-professional investors) exiting the market, making the rental crisis worse.

Since the beginning of 2022, mum and dad investors have been particularly active in Queensland, South Australia, and New South Wales. But in recent years their market share has been significantly below historic levels, resulting in falling rental vacancies.

The Synergies report says proposed rental reforms in Western Australia could lead to $105 million in increased rents and an estimated $143 million in higher property management costs each year.

REIWA president Damian Collins says retaining mum and dad investors is integral to a healthy rental pool.


Subscribe to our newsletter today and receive a FREE copy of How To Identify Hotspots