Changes to WA’s residential tenancy laws would only plunge the region deeper into a rental crisis, warns the Real Estate Institute of Western Australia (REIWA).

The warning comes after a survey of 7,000 investors revealed that 61% would exit the state’s rental market if major changes to WA’s tenancy laws were adopted.

The survey was conducted by Synergies Economic Consulting and formed part of an analysis of the economic impact of proposed reforms to the Residential Tenancies Act (1987).

Specifically, this survey focused on two proposals that have been a point of contention for the sector:

  • Removing the right of a property owner to evict a tenant without grounds
  • Allowing tenants to make modifications on a rental space without having to request approval from the owner

In its report, Synergies Economic Consulting cautioned that passing the proposals into law would impose considerable costs on the wider economy.

One of the most significant effects, the report claims, is that tenants in WA would have to pay up to an additional $105 million in increased rent annually.

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The report also revealed that the sector would incur an estimated $142.5 million more in increased property management costs annually.

It further uncovered that the proposed reforms would disproportionately affect owners and tenants of low-priced properties, with low-income tenants expected to face higher rents and have a harder time finding housing.

REIWA president Damian Collins said that while the proposals were well intended, the pay-off would be insignificant compared to the negative consequences.

“These proposals would make renting more difficult and expensive for tenants while simultaneously stripping investors of their rights and pushing up property management fees,” he said.

“There are fewer than 2,500 properties currently available for rent in Perth, and vacancy rates across the state are at or near record lows. Now is not the time to introduce reforms that would further discourage investors from buying in WA,” Mr Collins said.