Experts warn the banning of “no grounds evictions” and “refusal of pets” is pulling Hunter landlords from the market.
Real Estate Institute of NSW (REINSW) CEO Tim McKibbin visited Newcastle earlier in the week and spoke with industry professionals on the local state of property investment.
It came alongside rental vacancy rates in Newcastle maintaining a steady low of 1.7%, according to REINSW figures.
Mr McKibbin also emphasised the severe impacts of recent legislation introduced with the aim of protecting tenants.
In October 2024, the NSW Government unveiled new regulations to defend renters, including the end to “no grounds evictions” and banned “refusal of pets” in leased properties.
“Unfortunately, we are hearing everywhere we go that there are landlords who are making the decision to not remain in the long-term residential market, which is concerning,” Mr McKibbin explained to the Newcastle Weekly.
“They think having pets in their property exposes it to harm and, for that reason, some are looking at alternatives.
“Some are selling their properties, others are moving theirs into the holiday and short-term rental market, and others are simply locking the door and land banking.”
With the vacancy rates in Newcastle and the Hunter remaining below state averages, Mr McKibbin said the region couldn’t afford to lose anymore leases.
“In Newcastle, the amount of rental property in the area certainly isn’t anything like what the community needs,” he explained.
“If a tenant can’t find a property, that’s an issue for them.
“But, it’s broader than that because it means they can’t live in that area and they need to move elsewhere.
“That can have implications for our essential workers, like police, paramedics, fire, etc.
“Also, those in the retail environment and hospitality.
“The local economy breaks down when you don’t have people serving and supporting that community.
“So, it has bigger implications.
“That includes affecting the fabric of society if we can’t find accommodation for everybody.”
As of 1 October, the federal government updated the national First Home Buyers Scheme, which saw serious benefits for locals wanting to enter the housing market.
Those purchasing a property in Newcastle and Lake Macquarie would only require a deposit of as little as 5%, as well as the price for eligible homes increasing from $900,000 to $1,500,000.
However, Mr McKibbin said the updates didn’t improve the situation.
“The government is trying to solve a supply problem with demand,” he stated.
“If there is a fixed number of properties and you give people more money, that won’t increase the number of properties.
“All that’s doing is pushing up the price of a property.”
He said governments still needed to focus on increasing housing supply.
“They’ve got to stop dealing with symptoms and start dealing with bigger problems,” Mr McKibbin said.
“What we need is a higher density of property.
“As a city grows, you have choices; you either keep going out or you decide to go up.
“I think Utopia is when we start to build these smart properties, but in the short term we just need to build anything.”
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