After being announced for the first time in 2017, the Victorian Government’s Rent Fair Victoria agenda has since been passed in Parliament, resulting in a dramatic change to the Residential Tenancies Act. In today’s blog, Think Property & Co explain the rent reforms in more detail.
The new RTA stipulates that landlords must provide a valid reason for terminating a tenancy – meaning they no longer have the right to deliver a ‘120 day no specified reason notice to vacate’. The new act will outline appropriate reasons that a landlord can deliver a notice to vacate – selling or renovating the property will be deemed valid reasons.
Other changes to the act include making conditions more accommodative of longer leases, giving landlords more income certainty and tenants a more security in their long term living arrangements.
A Commissioner for Residential Tenancies is soon to be appointed. This nominated person will liaise widely with tenant’s advocacy groups to combat systemic issues as they arise. Landlords and agents will also be subject to a ‘blacklist’ should they engage in misconduct or breach the conditions set out in a tenancy agreement – in the same way that tenants are currently.
In a bid to speed up the infamous bond return process, the Residential Tenancies Bond Authority will be able to authorise bond refunds within 14 days, with or without landlord consent. Essentially, landlords must respond to the request for bond release within 14 days, otherwise the RTBA will authorise the return on a landlord’s behalf.
Currently, rent increases are permitted every 6 months, but the new reforms will extend this to 12 months. Aiming to offer tenants more consistency in their outgoings, restricting the frequency of rental increases means landlords must be even more on top of their annual rent reviews to ensure they don’t neglect to update their rent in line with market demand. When increases are delivered, they must be reasonable. If a tenant believes an increases is excessive for current market conditions, they can appeal to the Victorian Civil & Administrative Tribunal. There will also be a crack down on rental bidding, which mostly involves restricting property managers’ advertising liberties, and prohibiting any encouragement for offers to be made in a competitive manner.
Probably the biggest change in the new act concerns the allowance of animals in rental properties. Currently landlords are able to restrict any pets being kept in the home, but once the reforms come into practice, landlords will only be able to refuse a pet request from a tenant by order from VCAT. Tenants must get written permission from their landlord in order to keep a pet in the home, but landlords’ grounds for refusal will be much tighter.
Between now and the new reforms coming into play, work will be done with both tenants and landlords to establish a framework for establishing what defines a reasonable reason for refusal. Guidance will also be provided surrounding the requirement for pet-owning tenants to carry out additional departure tasks like cleaning and fumigation.
Currently, all modifications to a property must be approved by the landlord, but new legislation permits tenants to be able to make ‘minor modifications’ without written consent. The legal definition of ‘minor’ is still being established, but there is expected to be tools available for tenants and landlords to assist in deciding whether or not modifications require consent. Minor modifications will likely be things like picture hooks and furniture anchors, while painting and the installation of fixtures will remain major modifications that require explicit consent.
All the changes outlined in the reforms are planned to be rolled out gradually between now and July 2020. Think Property & Co fully intend to support our landlords and tenants as much as possible during the transition period, and continue to provide our premium service in accordance with the new legislation. We will update you further when we have more detailed information on these changes and how they will affect you.