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It has come to our attention that the proposed Manufactured Homes (Residential Parks) Amendment Bill of 2024 is unusually heavy handed in dealing with issues within the Residential Parks industry in Queensland with wide spanning implications beyond the Residential Park industry and significant proposed effects on Park Operators and Home Owners of Residential Parks.

The operational effects of the proposed amendment bill are highly questionable in terms of its effectiveness to address any of the major issues identified in previous surveys, as well as its implications on individual rights to freehold property, democratic value and the long-term sustainability of Residential Parks. 

Home Owners stand to lose significantly in the medium and longer term through home devaluations particularly for those older and already established Residential Parks that are not 5-star resort style Residential Parks. 

As the Reforms put pressure on reducing overall financial sustainability and create uncertainty there may be many long-term existing Residential Parks at risk of being abandoned by business operators. The strong intervention does not give any means for operators to keep up with real cost increases felt significantly across the construction sector and services sectors which do not reflect the lower CPI rates, which is a broader indicator from a broad basket of goods and services measured. Residential Parks with requirements to replace ageing infrastructure and to offer competitive employment for park maintenance services stand to lose significantly and directly contribute to the unsustainability of Residential Parks.

During a significant housing crisis in Queensland, the government has tabled a raft of reforms to the Manufactured Homes (Residential Parks) Act 2003 (Qld) that will put direct pressure on the general Queensland housing market by putting pressure on those currently owning or looking to own homes in over 50's lifestyle Residential Parks. By further creating direct competition between over 50's and younger home buyers these reforms may greatly exacerbate the current housing crisis which is also witnessing significant increases in homelessness. 

The current reforms are of a significant nature and concerningly are proposed to be passed without wider community engagement. The previous government survey amounted to as little as 5% of current Residential Park owners and the survey results fail to distinguish between different types of Residential Parks including caravan style Residential Parks. 

Without more appropriate data the government may be making decisions that are ill-informed even if well intentioned. Public Interest Forum as an organisation proposes to assist in data gathering by also gathering statistics and additional surveys and additional community feedback to address the primary issues facing the Residential Park sector.

The proposed reforms put further pressure on the QCAT processes and expands their jurisdiction. Various submissions to the QLD parliamentary committee handling the reforms have expressed concerns on the lack of proposed funding or assessment on QCAT's ability to handle further volume through these reforms. It is also highly likely that these reforms may further deepen distress and prolong conflicts caught in technical issues caught within the proposed forced buy back reforms and forced revaluations of property and other expanded QCAT jurisdiction under the legislation.   

Much like the issues experienced previously in the retirement village industry, the government has proposed that the Park Operators be forced to enter into a buy back scheme for all Home Owners should they opt-in to the scheme.

The Forced Buy Back scheme has serious implications for Home Owners and Park Operators including perhaps the unforeseen ability of Park Operators to claw back houses at discounted or lower than market rates from Home Owners where valuations do not take into account the unique nature of many Residential Parks.  If valuation disputes occur these could take years to resolve within the QCAT process.

The proposed reforms have a surprising rent freeze surreptitiously included as part of the 'rent increase' chapter of the amendment bill and for the proposed new Act to be assented. Further, the legislation allows for buyers to have a halved rent 12 months after the opt-in buy back scheme with no clarity as to whether Home Owners are required to follow through with the revaluation undertaken in the scheme or simply cancel the sale arrangements and enjoy prolonged half rent periods. 

These permanent rent freezes create a risk for establishing an inequitable situation and may be likened to a permanent freeze for bodies corporate to raise levies in an appropriate way to maintain common property and its infrastructure. This may drive Park Operators to explore creative ways to compensate for the decrease in income at the expense of Home Owners and does not incentivize Park Operators to reinvest into the Residential Park to be more competitive in order to generate higher returns as there would be little upside to reinvestment, the effects could be quite the opposite of government's underlying intention. 

The rent freeze also poses a significant dilemma to the medium and long term sustainability of Residential Parks, their market investment potential and further raises questions as to whether the government intends to take over Residential Parks in the future when they fail due to lack of funds to upkeep or abandonment. 

If the government through these reforms intends to see Residential Parks as being transformed into a Charitable or Not For Profit or more heavily subsidized sector that should be made more clear.  

To match the government's enthusiasm in countering predatory behavior and major issues in Residential Parks, some alternative recommendations to the current proposed heavy-handed 2024 Reforms Bill may be adopted to properly address the issues of stakeholders particularly Home Owners by including the following:

• Establishment of an Ombudsman - specialized vehicle for sharp and swift investigatory services to counter major issues and predatory behavior;
• Replacement of the general blank Rent Buy Back scheme with an Assistance Rent Buy Back scheme applicable to only those in significant hardship and dire needs - for example, requiring palliative care or intensive medical care;
• Removal of the general blanket Rent Buy Back scheme in order to protect Home Owners from having Park Operators force buy backs at lower than market rates;
• Removal of the general blanket Rent Buy Back scheme so as to avoid complete devaluation of Home Owner properties in Residential Parks;
• Significant scale back or complete overhaul of reliance on QCAT for discretionary decision-making with an Ombudsman as a strong alternative discretionary authority;
• Balancing of interests between Park Owners and Park Operators in order to avoid further manufacturing conflict and prolonged legal proceedings;

Other recommendations may be forthcoming after more engagement with the Home Owners, Park Operators and Park Managers.