Property Management- The MythApril 13, 2018
Rental RealityMarch 1, 2019
Earlier this year the Andrew’s Government announced that they would propose some 130 reforms to the current Residential Tenancies Act in a bid to ‘make renting fair for all Victorian’s’ and whilst the details have been rather sketchy to say the least the response from property owners has not been positive.
One in four Victorian’s are in rentals with that number continuing to rise as housing sky rockets and it becomes harder and harder for people to break into the housing market. The fact is that Mr Andrews has found an opportunity to appeal to tenants in an election year to secure the votes of renters who may feel that they are been treated unfairly.
So, what are the changes?
The proposed changes include, but are not limited to, setting minimum safety standards in relation to gas, electricity and smoke alarms including the energy efficiency rating of a home, minimum standards in relation to heating and home security, limits for bonds and easier claiming processes at the end of the tenancy for tenants and allowing tenants to make minor modifications without permission from the landlord. There will be new legislation around victims of domestic violence which will allow victims to terminate a tenancy without penalty and of course the most popular by far, restricting landlords’ rights to refuse a pet without written consent in the form of a VCAT order.
As time passed more details were released about each of the reforms and the effect that it would have on the rental market in Victoria with many landlords vowing to remove their property from the rental market altogether should the bill be passed. We were even given a chance to submit our thoughts and sign a petition opposing such laws which made us feel like we actually had a say and that someone was on the other end actually listening to our opinion.
However, on 7th September the Andrew’s Government announced that the rental reforms bill was passed through the upper house of parliament 21-17 without amendment and the community was in uproar and we were taking calls from angry landlords in the days that followed asking how tenant’s, who already have so many rights in comparison, could now have even more rights over a property that they did not own. At the other end of the spectrum was 99 phone calls from tenants calling to advise us that they now wanted to get a dog because the new laws have passed, but the fact it, it’s just not that simple.
So what are our thoughts on this whole saga?
We’ve read the proposals right through to the amendments and in my opinion the details of these amendments are still very sketchy, the new laws aren’t expected to become legislation within the RTA until early 2020 and there’s still a lot of work to be done to iron out the ins and outs of exactly how the implementation, guidelines and governing. This is the biggest reform to the Residential Tenancies Act since its inception in 1997 and it’s clear to see that the process is going to lengthy and complicated whilst the government, the tenant’s unions, consumer affairs and the REIV and professional bodies work out the finer details.
In a broader sense, however, are they really as bad as they seem?
Should a tenant not have the right to expect that their stove, heating, hot water and locks are all in good working order at all times?
Should a young family who may never have the ability to break into the rental market be refused the right to have a pet in their home?
Should a tenant not be able to make a house a home by hanging pictures on the wall to display their favourite family photos?
Everyone has a different opinion and everybody feels differently and what I have found is that most of these opinions and feelings have come from a past experience either personal or through six degrees of separation about dogs who destroy gardens and cats who pee on carpet. The reality is that in my experience tenants who have pets are more cautious about the care and maintenance of the property and those allowed to hang pictures have a few family photos scattered throughout the living space in their homes showing some of their favourite memorable moments.
Domestic violence cases are at an all time high with 1 in 3 women and 1 in 5 men the victim of violence in their own homes and relationships. Each year there are more than 250,000 reports of family violence situations in this country and this year alone 67 women and 18 children have been killed in Australia as the result of domestic violence. Let’s take renting out of the picture for a moment… that number is massive! To date that is two people a week who have lost their life at the hands of a family member or partner and these statistics don’t include men which indicates the number could be closer to 3 per week. It’s not unreasonable to expect that men, women and children should be able to feel safe and secure in their own home, what kind of landlord would you be who protested to a reform that would ensure the safety of someone in their own home, the ability to escape a situation which could potentially end their life? The Andrew’s Government have vowed that this reform to the current act would not see landlords out of pocket in these extreme situations and obviously landlord insurance providers would need to include provisions in their policies to ensure that landlords are not put at financial risk in such situations – even so what price do you put on the life of a child in a volatile situation?
Let me tell you something, it’s not that bad!
Whilst 99% of landlords ensure that their tenants are safe, their smoke alarms are compliant and that the property is maintained with all fixtures and fittings in good working order there are a small handful who don’t do the right thing and will risk the safety and security of their tenants just to save a buck here and there on things that are completely tax deductible. Majority of these reforms are aimed at the small portion of landlords who fail in their duty of care to do the right thing by their tenants.
Rents are at an all time high, the market is hot and vacancy rates are some of the lowest we’ve ever seen. With one in four Australians paying more than 75% of their wage for housing these reforms will force the hand of those landlords to adhere to minimum standards giving tenants value for their hard earned money and allowing them to make a rental property their home all the while paying off the mortgage and providing generous tax benefits for the landlord.
At the end of the day the truth is that the RTA has thousands of amendments and I encourage that if you are ever having trouble sleeping you pick up a copy and have a read and you’ll see that legislation has been amended, changed, deleted and introduced ever since the inception of the current RTA. As landlords and property managers we’ve adapted because we’ve had to, we’ve changed our policies, we’ve introduced new procedures and we’ve taken everything in our stride and moved on to tomorrow. The only difference with the Andrew’s reforms is that these changes have become so widely publicised as part of a political campaign in and effort to win 1 in 4 more votes at the polls.