Leasing and management of rental housing including rooming houses

The Victorian Government is proposing extensive changes to the minimum standards around energy efficiency and safety requirements for rental properties and rooming houses.

The REIV supports the state government’s objectives around the improvement of energy efficiency and safety standards in rental properties but strongly urges government to reconsider the timing of this introduction. Without adequate financial support from government, any moves to force further expenditure on the maintaining of a rental property is likely to have a significant impact on the state’s rental supply. While the climate objectives are worthy and welcomed broadly by the REIV, any further factors that will accelerate the loss property from the rental market will be detrimental for renters in Victoria.

With all of this in consideration, the REIV is seeking financial assistance for RRPs for the implementation of minimum standards and an extension of transitional periods. The appropriate rebate and incentive structures, including tax concessions, must be in place to retain RRPs and ensure that rentals remain on the market. The REIV will continue to support quality housing outcomes for all participants within the rental ecosystem and encourages the settings that promote its ongoing stability. The REIV is seeking to prevent RRPs from the leaving the market as a means of protecting the interests of all stakeholders

A vast number of changes to residential tenancies came into effect because of amendments to the Act in 2018. The bulk were effective from 29th March 2021.

It has become apparent that the changes are not operating efficiently and perhaps not as intended. The complexity and inefficiency of the changes has become a significant contributing factor to:

• A reduction in the supply of rental premises as rental providers sell properties or withdraw them from the longer term rental market, due to increased costs, complexity and lack of control over their investment.

• A huge backlog of residential tenancy cases at VCAT

• An exodus of property managers and major difficulty in finding and training people to take up residential property management roles.

While still respecting the government’s intent and recognising that some opportunities for improvement were not addressed, this paper has been prepared to demonstrate opportunities for enhancement and suggests how the enhancements might be achieved. The recommendations listed here aim to simplify the Act, remove ambiguity and reinstate some balance between rental provider and renter obligations.

Over 120 new rental tenancy standards came into effect on 29 March 2021 making it one of the most significant changes to residential real estate in recent times. The changes are significant for the real estate sector and impact renters and owners equally.

The REIV has prepared a comprehensive online reference book that has been reviewed and supported by the Victorian Government through funding from the Victorian Property Fund with approval from the Minister of Consumer Affairs.

The book details the reforms and relevant modules in the legislation and provides interpretation and explanation to assist in implementing the changes.