The New, Proposed Tenancy Legislation; What Do We Know?
The new legislation for residential tenancies proposed by the Andrews government recently is a hot topic of conversation among tenants, landlords and real estate agents alike. But what do we really know? The information given so far about the reforms is vague and gives only a limited insight.
What is being proposed?
There are a number of reforms being proposed, here is a summary:
- Rent increases will only be permitted every 12 months, it is currently 6 months.
- Properties must be advertised with a fixed price attached and will not be able to accept an offer higher than the advertised price.
- Introduction of an agent/landlord blacklist for those who breach their responsibilities under the residential tenancies act.
- Pets cannot be reasonably refused at a rental property by the landlord. Tenants must still get permission in writing. Tenants will be responsible for damage and fumigating properties when leaving.
- Tenants will be able to apply to have their bond released directly to the Residential Tenancies Bond Authority. If not disputed by the agent or landlord within 14 days, they will receive their bond back.
- Unless exempt, the bond may not be higher than one calendar month’s rent. This does not apply to properties leased at $760 per week or higher. (Double the current median).
- If a tenant pays for urgent repairs, the landlord will have to reimburse them within 7 days rather than the current 14.
- 120 day end of fixed term notice to be abolished, landlord/agent must give reason to end a tenancy.
- If an end of fixed term notice is served, the tenant will have the right to serve 14 days’ notice back rather than to continue paying and residing in the property until the notice termination date.
- Asbestos in the property or intention to sell will have to be disclosed to tenants.
- Tenants will be able to make “minor modifications” to the property such as installing picture hooks.
What’s the Problem?
So far, the information that has been provided is vague. Such as, what is considered a “minor modification”? What exemptions would apply to take a greater bond than one month? How will the agent/landlord blacklist be policed? What circumstances would count as “reasonable” when saying no to pets in a rental property?
We’re hoping that if these reforms are passed that the result will be a clean, well explained section of legislation. But, as it stands, the proposed reforms don’t give enough information to deduce an informed assessment.
What does the REIV say?
The REIV has stated that the proposed reforms may cause devastation to the rental market, forcing prices up, supply down and therefore demand up. They’ve warned that the reforms will reduce the attractiveness of investing in Victoria and cause a potential mass exit from the market by current investors.
To read the full article released by the REIV visit https://reiv.com.au/news-resources/latest-news/rental-reforms-to-leave-landlords-exposed-tenant.
What does Savoy say?
These reforms are not a reason to panic. While the information is being presented as a huge win for tenants and a huge loss for landlords, the reforms are not confirmed yet.
It’s our job at Savoy Real Estate to adapt and act to protect the best interests of our clients no matter what the situation. We will continue to provide updates to our clients as we get more information on the tenancy reforms.
However, should you not be one of our clients currently and would like to be kept updated regarding the reforms, feel free to email [email protected] and we will send through our articles relating to this subject as they are released. (Please note: you will not receive calls, emails, SMS or any other form of communication trying to solicit your business or regarding any other releases by our company unless you opt to).
Do I have to take any action now?
No. The reforms have not been passed and are not confirmed yet. This is simply just a preliminary release of information about potential reforms.
Should you require further information or would like to discuss the proposed reforms, feel free to contact Savoy Real Estate on 1300 328 848.