In a bid to make renting “fairer” for both tenants and landlords, the Victorian government has passed the “biggest reforms to renting in Australia” this year, according to Minister for Consumer Affairs, Gaming and Liquor Regulation Melissa Horne.  

“We’re delivering on our promise to make renting fairer for all Victorians. Renters have a right to a safe, secure and affordable home they can call their own, and landlords should have peace of mind with stronger accountability from those renting their properties,” Ms Horne said.

The overhaul includes the requirement for a number of basic amenities in each and every rental property, as well as modifications that tenants can make to their rental property.

It also lists down the information that rental providers must disclose prior to entering a rental agreement, terms that cannot be included in a rental agreement and questions that cannot be asked of rental applicants.

Here are some of the highlights of the Residential Tenancies Regulations 2021:

What is the information that rental applicants should and should not disclose?

Prescribed information to be disclosed by rental applicants include age, disability, employment activity, expunged homosexual conviction, gender identity, industrial activity, marital status, parental or carer status, physical features, political belief or activity, pregnancy or breastfeeding, race, religious belief or activity, lawful sexual activity or sexual orientation, sex or intersex status.

As these are protected attributes, rental providers and their agents are prohibited to discriminate against a rental applicant in relation to these attributes or their association with someone who has these personal attributes.

On the other hand, rental applicants are not required to disclose any previous legal action or disputes undertaken, as well as rental bond history, credit or bank account statement with daily transactions and any information relating to a protected attribute unless the reason for requirement is stated in writing.

Renters must also complete a condition report, which records the state of the premises at the start of the rental agreement.

What should rental providers disclose to applicants?

Upon application, prospective tenants must be informed of the ABN and trading name of the embedded network operator, contact details and electricity tariffs and all associated fees and charges, and be provided with a copy of any owners corporation rules applicable to the rented premises.

Rental providers must also disclose if the property has been a location of a homicide or contaminated due to prior use for the trafficking or cultivation of drugs in the last five years, if it has friable or non-friable asbestos, or if it is affected by a building or planning application.

Applicants must also be informed whether the rental provider has received a repair notice relating to mould and damp in the last three years, as well as the date of the most recent gas safety check, electrical safety check and pool barrier compliance check and any outstanding recommendations for safety checks.

They must also know if the property is subject to any notice, order, declaration, report or recommendation in relation to building defects or safety concerns.

Other prescribed information include the property’s compliance to rental minimum standards and the status of its registration, as well as current disputes under the Domestic Building Contracts Act 1995 and the Owners Corporations Act of 2006.

What are the rental minimum standards?

The minimum standards for rentals include:

1. Locks for all external entry doors.
2. Vermin-proof bins.
3. Toilets.
4. Bathroom facilities such as washbasin and a shower or bath with a connection to a reasonable supply of hot and cold water. Where a shower is present, shower heads must have a three-star rating unless it cannot be installed or it will not operate due to the age, nature and structure of the plumbing of the premises.
5. Kitchen facilities including a sink and a cooktop with two or more burners in good working order. 
6. Laundry facilities.
7. Structural soundness.
8. Free of mould and damp.
9. Electrical safety: All power outlet and lighting circuits must be connected to a switchboard-type circuit-breaker that complies with AS/NZS 3000, “Electrical Installations”; and a switchboard-type residual current device that complies with AS/NZS 3190, “Approval and test specification—Residual current devices (current operated earth-leakage devices)”, AS/NZS 61008.1, “Residual current operated circuit-breakers without integral overcurrent protection for household and similar uses (RCBOs): Part 1: General rules”, or AS/NZS 61009.1, “Residual current operated circuit-breakers with integral overcurrent protection for household and similar uses (RCCBs) Part 1: General rules”.
10. Windows with functioning latch.
11. Window coverings such as curtain or blind.
12. Lighting in interior rooms, corridors, hallways and each habitable room.
13. Ventilation in each habitable room, bathroom, shower room, toilet and laundry. 
14. Heating: A fixed heater in the main living area, preferably energy-efficient, unless deemed unreasonable due to cost and existing rules and regulations.

What are the prescribed safety devices within rental premises?

Smoke alarm, carbon monoxide alarm, residual current device, swimming pool barrier, fire sprinkler system, fire hose reel, fire blanket, fire hydrant, fire window, fire extinguisher, security camera in a common area, emergency lighting and a hot water safety device.

When are tenants not required to comply with a maximum bond?

The prescribed amount of rent for which maximum bond does not apply is $900.

How can renters pay their rent?

The prescribed payment method is electronic funds transfer.

What’s the procedure for rent increase?

A minimum of 60-day notice must be given prior to any rent increase, with a valid notice of proposed rent and the method by which the rent increase was calculated. Rent increases are allowed only once every 12 months.

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 Victorian Civil and Administrative Tribunal (VCAT).

What are the modifications that renters can make without the landlord’s consent?

In a rented premises that is not a registered place, tenants can install the following:

1. Picture hooks or screws for wall mounts, shelves or brackets on surfaces other than exposed brick or concrete walls.
2. Wall anchoring devices on surfaces other than exposed brick or concrete walls to secure items of furniture.
3. LED light globes which do not require new light fittings.
4. Water-efficient shower head if the original shower head is retained.
5. Blind or cord anchors.
6. Security lights, alarm systems or security cameras that do not impact on the privacy of neighbours; can be easily removed from the rented premises; and are not hardwired to the rented premises.
7. Hardware-mounted child safety gates on walls (other than exposed brick or concrete walls).

In all rented premises, tenants can install the following:

1. Non-permanent window film for insulation, reduced heat transfer or privacy.
2. Wireless doorbell.
3. Replacement of curtains if the original curtains are retained by the renter.
4. Adhesive child safety locks on drawers and doors.
5. Pressure-mounted child safety gates.
6. Lock on a letterbox.

Concerns 

While the reforms aim to make renting in Victoria fairer and equitable, the Real Estate Institute of Victoria (REIV) expressed concern that the reforms might mean substantial increases to cost and additional complexity to property maintenance and management for landlords.

REIV CEO Gil King said that this would trigger an “unbalanced regulatory burden” and ultimately become a “deterrent for investment”.

“New costs introduced through these changes are likely to result in higher rents and could see mum and dad investors exit this asset class, putting further pressure on rental availability and affordability for Victorians,” he said.

However, following a round of education, tools and resources that the REIV has provided tenants and landlords in the past months, Mr King remains optimistic for the future of the Victorian rental market.

Giving a nod to the way property managers and the wider real estate industry had coped with the pandemic in 2020, Mr King said that, for decades, real estate in Victoria has managed to play well with the cards it has been dealt.

“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.