With several proposed changes in real estate legislation coming to Queensland in 2024, you will need to ensure your real estate agency or property development business is prepared. This article will provide a helpful overview of the key amendments under consideration, from changes to rental bond management and foreign investment rules to new sustainability requirements for properties. Understanding these reforms early will allow you to get your agency or business ahead of the game when it comes to implementing any necessary operational adjustments to remain compliant. This article outlines everything you need to know now about the real estate law reforms on the horizon.
 

Overview of Real Estate Legislation in Queensland

Property Law Act 1974
The main legislation governing property law in Queensland is the Property Law Act 1974. This Act regulates areas such as the creation and transfer of interests in land, mortgages, leases, and easements. The Act aims to codify and consolidate the law relating to property and conveyancing in Queensland.
 
Land Title Act 1994
The Land Title Act 1994 establishes the Torrens title system of land registration in Queensland. Under this system, the Registrar of Titles keeps a register of land holdings and records the ownership and interests in land. The Act promotes the security and reliability of titles by providing a statutory guarantee of title for registered proprietors.
 
Retail Shop Leases Act 1994
The Retail Shop Leases Act 1994 regulates the leasing of retail premises in Queensland. The Act aims to balance the rights and obligations of retail landlords and tenants. It requires leases to contain minimum terms, regulates rent increases, provides security of tenure for tenants, and access to dispute resolution. The Act has recently been amended to provide further protections for tenants affected by events like pandemics.
 
Body Corporate and Community Management Act 1997
The Body Corporate and Community Management Act 1997 provides for the establishment and operation of bodies corporate, which are legal entities that manage common property in multi-unit developments. The Act sets out the rights and responsibilities of lot owners and bodies corporate, regulates the management of common property, and provides a dispute resolution process. Recent amendments have focused on improving governance and accountability of bodies corporate.
 
In summary, the above legislation aims to regulate property ownership, protect land titles, balance commercial interests, and govern shared property arrangements in Queensland. Staying up to date with changes to these Acts is important for anyone working in the real estate sector.

Key Real Estate Legislative Changes Coming in 2024

Increased Foreign Investment Scrutiny
The Foreign Acquisitions and Takeovers Act 1975 will be amended to expand scrutiny of foreign investments in residential real estate. All proposed foreign acquisitions of residential land, regardless of value, will require approval from the Foreign Investment Review Board (FIRB). The reforms aim to improve housing affordability by limiting foreign demand. Foreign persons will need to apply for FIRB approval before purchasing any residential real estate in Australia.
 
New Off-The-Plan Contract Requirements
Developers will need to provide more detailed information to purchasers regarding off-the-plan property contracts. Additional disclosure will include estimated completion dates, details on common property, and proposed strata levies. The reforms intend to provide greater transparency for buyers around the total costs of off-the-plan developments. Developers who fail to comply with the new disclosure requirements may face penalties.
 
Tighter Regulation of Property Managers
Property managers and agents will face additional licensing and conduct requirements. All property managers will need to obtain a license to operate, requiring a certain level of education and training. The licensing system aims to improve standards and accountability across the property management sector. Additionally, a mandatory code of conduct will stipulate minimum standards of practice for property managers relating to issues like rent collection, maintenance, and dispute resolution. Severe breaches of the code may result in loss of license.
 
The upcoming legislative changes will significantly impact many areas of Queensland’s real estate sector. While aiming to strengthen consumer protection and improve housing affordability, the reforms may also increase costs and complexity for some industry participants. Property professionals are advised to closely monitor the new laws coming into effect in 2024 to ensure full compliance.
 

How the New Laws Will Impact Real Estate Agents

The impending legislation changes will significantly impact how real estate agents operate in Queensland.
 
Licensing Requirements
To begin with, the new laws will introduce more stringent licensing requirements for real estate agents. Agents will need to complete additional training and education to renew their licenses. This aims to raise professional standards across the industry and protect consumers.
 
Commission Structures
The reforms will also change how agents are paid. Currently, most agents earn a percentage of the sale price as commission, known as “percentage-based commission”. The new laws will ban this model and require agents to charge fixed dollar fees instead. This is intended to reduce potential conflicts of interest and encourage agents to get the best outcome for their clients.
 
Disclosure Obligations
Agents will have expanded disclosure obligations under the new legislation. They will need to disclose more details about the properties they are selling, including the location, condition, and features. Agents will also have to clearly disclose all fees and charges to clients upfront before signing agency agreements. These measures aim to improve transparency in real estate transactions.
 
Trust Account Requirements
Finally, the new laws will increase the regulation of agents’ trust accounts, which hold deposits and other client funds. Agents will need to report trust account transactions more frequently and have their accounts audited annually by external accountants. This stricter oversight aims to prevent misuse of client funds and fraud.
 
The impending changes to real estate legislation in Queensland are significant and wide-ranging. Overall, the new laws aim to raise standards in the real estate industry, increase protections for consumers, and promote fairer real estate transactions. While the changes may be challenging to implement, they are intended to build a more ethical and professional real estate sector over the long term. Agents who understand and embrace the spirit of the reforms will be well placed to thrive under the new regulatory environment.
 
What the Changes Mean for Property Investors and Landlords
Modified Stamp Duty Charges
The amendments to the stamp duty charges in Queensland aim to make property investment more affordable. Investors purchasing investment properties will receive a 50% discount on stamp duty fees. This concession lowers the upfront cost of acquiring a rental property and may translate into higher investment yields.
 
Changes to Rental Regulations
The introduction of the minimum five-year lease term provides more stability for landlords. However, landlords will need to accept that they cannot easily evict tenants or increase rents during this period. The benefit is that investors can secure a long-term income stream from the rental property. The ability to increase rents in line with the consumer price index during a lease may help offset some costs.
 
Additional Compliance Requirements
Property managers and landlords will face additional compliance requirements, like maintaining property condition reports and tenancy databases. Failing to meet these requirements can result in penalties. To avoid issues, investors should ensure that property managers have robust compliance processes in place and all legislative obligations are fulfilled.
 
Tax Implications
Changes to depreciation allowances may impact tax liabilities for some investors. Investors who purchased properties before the new legislation should carefully analyse how the new rules could influence their tax position to maximise benefits. For new investors, the ability to claim depreciation on plant and equipment over more extended periods could lower taxable income from the property in the short-term.
 
The changes aim to promote sustainable growth in the Queensland property market and support affordable housing. For investors and landlords, the amendments mean balancing more stable income streams with increased responsibilities. With prudent decision making and reliable property management partners, Queensland rental property investments can still achieve good returns despite the legislative changes. Carefully evaluating the full implications of the reforms for your portfolio is critical to optimising outcomes.
 

Real Estate Legislation FAQs: Your Top Questions Answered

Will the new legislation affect my current property or only future purchases?
The upcoming changes to Queensland real estate laws in 2024 will apply to all properties, regardless of when you purchased them. Some of the amendments, such as those related to terminating tenancy agreements or the dispute resolution process, may impact current rental arrangements and leases. However, the bulk of the revisions aim to improve consumer protections and transparency for future real estate transactions in the state.
 
What specific changes can I expect?
Several important modifications will come into effect in January 2024:
  • Mandatory cooling-off periods: Purchasers will have 3 business days after signing a contract to withdraw from the agreement with no penalty. This applies to all residential properties, regardless of whether purchased at auction.
  • Increased disclosure requirements: Sellers and agents must disclose any known defects or damage to the property. Failure to disclose relevant information could void the contract. Agents must also clearly display the property’s price and outline key terms of the agreement in all advertising.
  • Tighter restrictions on unfair contract terms: Certain clauses that disproportionately favour the seller, such as those allowing termination of the contract without cause, will be prohibited. Terms must be reasonable and clearly explained to purchasers.
  • Dispute resolution process: A free mediation service will be available to help resolve any disputes between buyers, sellers and agents. If mediation is unsuccessful, consumers can pursue the matter in the Queensland Civil and Administrative Tribunal.
  • Harsher penalties: Fines for breaching legislation have increased substantially. Repeat or serious offences can also result in loss of licensing and professional registration. The changes aim to deter poor practices and unethical behaviour in the real estate industry.
How will the new laws benefit me as a consumer?
The revised legislation focuses on strengthening consumer protections and making the real estate process fairer and more transparent. The additional disclosures, cooling-off period, and dispute resolution options will give you more confidence and security when buying or selling property in Queensland. The harsher penalties for agents and agencies that violate the rules also help ensure higher professional standards across the industry. Overall, the changes give consumers more power and less risk in real estate transactions.
 
 
As we have seen, the proposed changes to real estate legislation in Queensland will have wide-ranging impacts for both property professionals and home buyers when implemented in 2024. With the introduction of reforms like open bidding at auctions and longer cooling-off periods for purchases, you will need to adapt your practices to align with the updated regulations. Additionally, as a prospective buyer, you should educate yourself on how the new laws will affect your experience of finding and securing your ideal property. While the reforms may bring some initial upheaval, the intended outcome is a fairer and more transparent real estate process for all in Queensland. With preparation and prudence, you can ready yourself for the upcoming transition as we move towards a new era in real estate law.

Bella