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Renting Reforms Pass Through The Victorian Parliament

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With the new laws passed, market participants including landlords, renters and property managers should seek for advice on the implications of the legal changes.

The renting reforms will come into effect progressively, and all will have commenced by 1 July 2020.

The Victorian Parliament has passed the Residential Tenancies Amendment Bill 2018, which includes more than 130 reforms designed to increase protections for renters, while ensuring those who provide rental housing can still effectively manage their properties.

Consumer Affairs Victoria will oversee implementation of the new laws. The changes will come into effect progressively, and further consultation will be undertaken where necessary to develop guidelines about the new laws.

Introduction

The Residential Tenancies Act is the main source of consumer protection for Victorians living in rental housing, while also outlining the obligations of landlords and property managers.

Since it was introduced, there have been many changes, both in the rental market itself, and in the characteristics, needs and expectations of tenants and landlords. In the past, private rental was commonly a relatively short-term transitional arrangement, which ended in tenants moving to home ownership or in a move to social housing.

This is no longer the case, with growing numbers of Australians in rental housing, and around one-third of private tenants nationally considered to be ‘long-term’, having rented continuously for over 10 years. An increasing number of long-term tenants are either older people on fixed incomes, or families with children, for whom stability is important.

The reasons why people become and remain landlords have also changed significantly, with rental property becoming an important investment and a key feature of many people’s retirement plans.

The review process

The review represented a once-in-a-generation opportunity to revisit the regulatory settings that have been in place since 1997, and to ensure they meet the needs of participants in today’s rental housing market.

Public consultation was a significant feature of the review, commencing with the release in June 2015 of the consultation paper Laying the Groundwork, followed by a series of six public consultation papers covering a broad spectrum of rental issues – from security of tenure to protections for people living in caravan parks and residential parks.

In January 2017, Heading for Home, an options paper outlining the outcomes of public consultation, was released for final discussion.

During the review, more than 4,800 public comments were submitted by a range of people and organisations.

Outcomes

Drawing on stakeholder submissions, broader consultation across government, as well as the results of independent market research, a package of more than 130 reforms to the Residential Tenancies Act was developed.

The reforms are framed around the reality that a growing proportion of Victorians are priced out of home ownership and likely to rent for longer periods of time. There is, consequently, a need to rebalance the market through additional protections for a highly diverse population of renters.

A number of the reforms were announced as part of the Government’s ‘Rent Fair’ campaign in October 2017. These included:

  • allowing animals to be kept in rented premises
  • allowing renters to make prescribed minor modifications to a rental property
  • bolstering security of tenure and ending ‘no fault’ evictions by removing the ‘no specified reason’ notice to vacate and restricting the use of ‘end of the fixed-term’ notices to vacate to the end of an initial fixed term agreement
  • establishing a non-compliance register ‘blacklisting’ residential rental providers and agents who fail to meet their obligations
  • providing for the early release of bonds with the consent of both parties to the tenancy agreement
  • restricting solicitation of rental bids by residential rental providers and agents
  • providing for yearly, instead of six-monthly, rent increases
  • providing for faster reimbursement where renters have paid for urgent repairs
  • increasing the number of properties to which the statutory maximum cap of four weeks for bond and rent in advance applies
  • enabling automatic bond repayments, which will be available to a renter within 14 days where the parties are not in dispute over the apportionment of the bond
  • requiring mandatory pre-contractual disclosure of material facts, such as an intention to sell the rental property, or the known presences of asbestos
  • prohibiting misleading or deceptive conduct inducing a person into renting a property.

The proposed reforms were introduced into Parliament on 7 August 2018.

Source: engage.vic.gov.au “New renting laws pass Parliament”

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