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New Rental Laws – March 2021

Over 130 rental standard reforms from the Victorian government took effect on Monday, 29 March 2021.

Important information that landlords must be aware of:

 

The terminology for residential tenancies will be updated as follows :

  • Tenants are now known as renters
  • Landlords are now knows as residential rental providers (RPP)

 

Safety Related Activities

All Victorian landlords need to ensure that new mandatory safety checks are completed at their property in accordance with the safety-related obligations under the Residential Tenancies Act. Obligations include requirements for:

  • Smoke alarm servicing each year including testing, battery replacement and positioning checks
  • Gas safety checks every 2 years on all gas fixtures & fittings such as heaters, cooktops, water heaters and the mains gas line
  • Electrical safety checks every 2 years of all electrical appliances, fixtures & fittings such as switchboards, power points and light switches

All the safety checks dates will now be recorded on entry /condition report when the renters first moved in to the property.

We are working with Detector Inspector to finalise few details – instalment option, requirements for newly settled properties, etc.

 

Disclosure requirements prior entering into a rental agreement

Under the new laws, Victorian rental providers (landlords) must disclose the following important information to renters before they enter into a rental agreement:

  • whether an agent has been engaged to sell the property or if a contract of sale has been prepared, that there is an ongoing proposal to sell the property; or
  • if proceedings have commenced to enforce a mortgage over the property, that a mortgagee is taking action for possession of the property; or
  • if the rental provider is not the owner of the property, that the rental provider has a right to let the property and the nature of the rental provider’s interest in the property; or
  • if electricity is supplied to the property from an embedded electricity network, the prescribed details of the embedded electricity network; or any other information in relation to the property prescribed by the Regulations – presence of asbestos.

If the disclosure requirements are not complied with the renter may make a general application to Victorian Civil and Administrative Tribunal (VCAT) for a compensation order. VCAT can grant that order or another order as it sees fit. Please do inform us from time to time if your circumstance changes.

 

Rent Increment

Rent increases will be limited to no more than once per year and a minimum of 60-day notice must be given prior to any rent increase

The new provisions require that the notice of proposed rent increase must include:

  • the amount of the rent increase; and
  • the method by which the rent increase was calculated.

Renters can challenge a rent increase via ‘Rent increase investigation’ application to the Director of Consumer Affairs Victoria or an application for an order declaring the proposed rent to be excessive to the VCAT.

 

Modifications in the property

Renter can make minor modifications without seeking the rental provider’s consent.


o the installation of picture hooks or screws for wall mounts, shelves or brackets on surfaces other than exposed brick or concrete walls

o the installation wall anchoring devices on surfaces other than exposed brick or concrete walls to secure items of furniture

o the installation of LED light globes which do not require new light fittings
o the installation of water efficient shower head if the original shower head is retained
o the installation of blind or cord anchors
o the installation of security lights, alarm systems or security cameras that do not impact on the privacy of neighbours; can easily be removed from the rented premises; and are not hardwired to the rented premises

o installation of hardware mounted child safety gates on walls (other than exposed brick or concrete walls) In all rented premises
o installation of non-permanent window film for insulation, reduced heat transfer or privacy
o installation of a wireless doorbell
o replacement of curtains if the original curtains are retained by the renter o Installation of adhesive child safety locks on drawers and doors
o installation of pressure mounted child safety gates
o installation of a lock on a letterbox

Renter will be responsible for restoring any changes made to the property if requested.

 

Property Conditions

Residential rental providers will be required to ensure that the rental properties they let out comply with prescribed rental minimum standards. The minimum standards that will be prescribed will include basic, yet critical requirements relating to amenity, safety and privacy, such as:

  • a vermin proof rubbish bin
  • a functioning toilet
  • adequate hot and cold water connections in the kitchen, bathroom and laundry
  • external windows that have functioning latches to secure against external entry
  • functioning cooktop, oven, sink and food preparation area
  • functioning heating in the property’s main living area
  • window coverings to ensure privacy in any room the owner knows is likely to be a bedroom or main living area

If a property does not comply with the prescribed rental minimum standards, the renter can terminate the residential rental agreement before they move in, or they can move in and request compliance as an urgent repair. If the RRP fails to bring the property up to standard following the urgent repair request, VCAT can order that the rent be redirected into the Rent Special Account.

 

Termination of lease

Renters will be able to give 14 days’ notice of intention to vacate, without paying lease break fees, in limited circumstances:

  • where the RRP has given the renter a notice to vacate
  • where the renter needs special or personal care
  • where the renter has been offered and accepted accommodation in social housing
  • where the renter needs temporary crisis accommodation
  • where the RRP has given the renter a notice of intention to sell the property and conduct sales inspections (if the renter was not already told of the proposed sale before moving in).

Under new renting laws, a rental provider (landlord) must use a valid reason to issue a notice to vacate to a renter. They cannot issue a ‘no specified reason’ notice to vacate and will be required to attach evidence of a change of use to a notice to vacate for change of use. Examples of required evidence could include a building permit, or a statutory declaration from the family member moving into the rented premises.

 

Repeated late / non-payment of rent

Under the new rental laws, when a renter pays back overdue rent within 14 days any notice to vacate issued by the rental provider (landlord) for that overdue rent is invalidated (the first four times this happens in a year).

 

A rental provider can give a renter a 14-day notice to vacate for unpaid rent when the renter owes 14 days rent or more. But if the renter pays the overdue rent owed within the 14-day notice period, the notice to vacate has no effect.
If a renter does not receive any more notices to vacate for unpaid rent in the current 12-month period, the strikes will be cleared at the start of the next 12-month period.

For example, a renter receives four strikes in the first year of their rental agreement, paying back the overdue rent within the 14-day notice period each time. The next year they receive a fifth notice to vacate for unpaid rent, but because this is a new 12-month period, it is regarded as the first strike of the new year and the rental provider cannot seek a possession order.

 

What happens if the renter is late with their rent for the fifth time in a 12-month period?

If the renter receives a fifth strike (notice to vacate for unpaid rent) in a 12-month period, the notice to vacate is valid regardless of whether the renter pays back the rent owed within the 14-day notice period. If the renter does not vacate within the 14-day notice period, the rental provider can apply to the VCAT for a possession order, meaning the renter can be evicted. VCAT cannot dismiss the application on grounds that the renter can pay off the rent on a payment plan. VCAT must still consider whether eviction would be reasonable and proportionate.

 

What happens if the renter receives a notice to vacate for unpaid rent but doesn’t pay back the overdue rent during the 14-day notice period?

If the renter has been issued a notice to vacate for unpaid rent and has not paid back the full amount of rent owed within the 14-day notice period, the rental provider can apply to VCAT for a possession order (eviction) if the renter has not already vacated.

When deciding whether to make a possession order, VCAT will assess whether to place the renter on a payment plan to repay the overdue rent. If a renter is placed on a payment plan and makes the payments, VCAT will not make the possession order. VCAT can make the possession order if a payment plan is not feasible, or if the renter is placed on a payment plan but doesn’t make the payments.

 

Pets

Under the new laws landlords cannot unreasonably refuse consent, and if they want to refuse they will have to apply to VCAT, so any “no pet” clauses included in agreements after the new laws started will not be valid.

However, for rental agreements with “no pet” clauses that were signed before the new laws started, a landlord or agent may try to threaten a tenant with eviction if they do not get rid of a pet they are keeping in breach of their agreement. Renters can’t be evicted just for having a pet when the lease agreement has a “no pet” clause.

For a tenant to be evicted for having a pet in their current home before the new laws started, the landlord would need to prove that the pet was causing a nuisance, damaging the property or endangering the safety of neighbours, and if a landlord tried to give a Notice to Vacate simply for having a pet, it would not be valid.

The landlord could apply to VCAT for an order that the renter has breached your agreement by breaching the “no pet” clause.  But there is no Notice to Vacate for this reason and VCAT cannot legally evict you for having a pet in breach of your agreement.

 

A comprehensive list of changes can be found at this link – https://www.consumer.vic.gov.au/housing/renting/changes-to-renting-laws/guide-to-rental-law-changes

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