Dear Client,
‘NO CAUSE’ EVICTIONS TO BE BANNED IN SOUTH AUSTRALIA – 16 JULY 2023
Media Releases – CBS – ‘No cause’ evictions to be banned in South Australia | Consumer and Business Services (cbs.sa.gov.au).
Tenants will no longer be able to be evicted from their rental home without cause under new rental reforms proposed by the State Government.
Submissions received in response to our review of the Residential Tenancies Act, to be released today, reveal that 68 per cent of the 5,565 South Australians surveyed support ending ‘no cause’ evictions.
While 82 per cent are in favour of tenants being provided 60 days’ notice if a fixed term lease is not to be renewed.
Under the proposed reforms, landlords would only be able to end a periodic tenancy or to not renew a fixed term lease for a prescribed reason, including any breaches by the tenant, wanting to sell, renovate or occupy the property.
The government intends to increase the minimum notice to end a tenancy from 28 days to 60 days. This change will ensure tenants have more time to secure a new home and make the necessary arrangements to move.
These reforms are in response to South Australia’s record low vacancy rate of less than 1 per cent.
Recent data published by Shelter SA indicates that nearly 40 per cent of tenancies were terminated by the landlord with the end of a fixed lease being the most common reason given. Additionally, 50 per cent of periodic tenancies ended without any reason provided.
Currently, this cannot be legally contested. Combined with only 28 days to vacate, this situation causes considerable anxiety and housing insecurity for tenants.
These reforms follow our earlier moves to address rental affordability. This includes banning rent bidding (which passed Parliament last month) and raising the bond threshold. Furthermore, making more people eligible for the Private Rental Assistance Scheme saves people on low-incomes thousands of dollars by avoiding upfront costs such as bond and rent in advance by providing bond guarantees and rent payments.
For the first time, tenants would also be allowed to keep pets in rental properties in South Australia, with reasonable conditions set by their landlord, such as keeping the animal outside.
The government plans to begin targeted stakeholder engagement on these reforms soon, with a bill to be introduced to Parliament later this year.
Agency Opinion on proposed changes:
We disagree that landlords should require a reasonable set of circumstances under which they can choose not to review a fixed-term lease. If not, a renewal must be issued. We believe this restricts your right to control your investment. Limiting reasons to not renew a fixed term to only breaches by a tenant, wanting to sell, renovate or occupy the property, removes discretion for the agency and landlord to end a tenancy. Sometimes, a tenancy may need to be terminated due to slow degradation of the property or the landlord/tenant relationship, even if no defined breach exists.
We support the proposal to increase the minimum notice to end a fixed tenancy from 28 days to 60 days. We aim to offer tenants at least 60 days when feasible.
With respect to Minister Andrea Michaels using the state’s record low vacancy rates as a reason for rental reform, we argue that this is a product of supply and demand. Vacancy rates will rise as supply increases, either through state government land releases for development or state government investment in public housing. It should not be the responsibility of private owners to supplement or replace public housing stock, as vacancy rates are reflective of free-market economics.
We feel that characterizing a landlord’s decision to end a fixed-term tenancy as an “eviction” is misleading, as it evokes images of court bailiffs and forcible removals. The decision to end a lease is a right every property owner possesses and should never be termed an eviction.
We disagree with the Minister’s statement that the current legislation hasn’t quite got it right and that the reforms will correct this. We believe that these further reforms tilt the balance too much in favour of tenants. Given a rental tribunal that is reluctant to end a tenancy due to housing insecurity, we believe this places landlords in a precarious financial position.
Lastly, we note the 90-day notice to end a fixed term tenancy will be removed, and a periodic lease will only end under the same conditions as a fixed term may end.
Changes that have been already implemented do not address housing insecurity. Allowing tenants to have pets or giving them more time to find a new property will not reduce the excessive number of tenants applying for properties.
What can you do? Reach out to your local MP, participate in local talk back radio, and inform your friends. Express your concerns that implementing these reforms could deter investment in residential properties and erode a landlord’s right to manage their assets.
You must question the Minister and Government’s decision to release their statement on a Sunday. Was it a covert attempt to strip away the rights of the landlord without ample notice?
Thank you for your ongoing support.
Regards David, Benjamin & the Team at DB Philpott Real Estate.
