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The Real Estate Institute of Victoria (REIV) has expressed disappointment at the struggles investors are facing as they seek clarification from the state government around 130-plus recent rental standard reforms.
The Victorian government’s Residential Tenancies Regulations 2021, which officially took effect on 29 March 2021, featured reforms to the rental standards that aim to make renting “fairer” for both tenants and landlords.
With over 132 changes, the overhaul was considered the “biggest reforms to renting in Australia” this year.
While it’s been three months since the reforms were implemented, REIV CEO Gil King said the real estate sector remains in a “vacuum of information” as clarifications on numerous issues remain largely unanswered.
In an opinion editorial piece hosted on the REIV website, Mr King blasted the government’s “radio silence”, noting that mum and dad investors are struggling with a long list of simple but important questions surrounding “vague and, at times, poorly written legislation”.
“The 132 changes to the tenant-owner relationship include increased cost, obligation and legal consequences for the owner. Not to mention confusion,” he wrote.
Mr King has laid out the most common questions from tenants and landlords following the reforms, stating that there are many “simple yes-or-no questions that have been ignored”:
1. Are electrical and gas safety checks required for “new build” houses that are rented out, given that plumbers and electricians have recently signed off?
2. Can notices of entry be served by email?
3. When do the minimum standards for rental properties and the obligation to carry out electrical or gas safety checks apply to properties that have been continuously occupied by the same renter?
4. What are “dead” locking devices for doors?
Mr King explained: “The legislation requires a deadlock be fitted to any external door that can fit a deadlock… but the definition of ‘deadlock’ is flawed because it means a ‘deadlatch’ with at least one cylinder….
“As a result, many rental providers are not replacing locks at all simply because they don’t know what is required.”
5. How will the notice to vacate work in demolition cases?
“Currently, a notice to vacate for this purpose will be invalid if a planning permit is not attached to the notice. The problem with this requirement is that most demolitions do not require a planning permit.
“How can you attach a document that does not exist?” the CEO asked.
Landlords in danger of breaking the law
According to Mr King, the state government’s failure to address the uncertainty across the property sector is “unacceptable”, especially given that rental providers may be in danger of breaking the law.
“Many of these issues could be clarified by the Andrews government [with ease],” the CEO said.
“The failure of the Andrews government to recognise the property sector and its contribution to the state — both economically and socially — means that Victoria is fast becoming a less desirable place to invest and do business.”
The REIV has previously expressed concerns over the rental standards reforms, saying that it could trigger an “unbalanced regulatory burden” and ultimately become a “deterrent for investment”.
But with a fresh round of education to assist both tenants and landlords through the transition, as well as the resilience displayed by the industry through the pandemic, Mr King remains optimistic for the future of the Victorian rental market.
“For this reason, we should have confidence that the competent people in the industry will manage through these changes and continue to contribute to a thriving sector,” the CEO concluded.
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