Whose House is it Anyway? Victorian Legislation Taking Control from Landlords

Proposed changes to the Residential Tenancies Act 1997  were announced in mid-October of 2017, and were met by a wealth of strong reactions from both renters, and landlords. According to the Andrews government, the proposed reforms are, first and foremost, to benefit renters. An official statement released on October 8th reads, “More than one in four Victorians rent their home, a number that is increasing as it becomes more difficult for many Victorians to break into the housing market. They need and deserve better protection.”

But what do these changes actually mean in practice?

For renters, the proposed reforms are something to be celebrated, with the promise of long-term rental stability, more accountability for landlords and agents, and easier access to creature comforts that make a rental feel like a home. This last point has been one of considerable contention, as reforms remove blanket bans on pets, and allow renters to make certain modifications to rental properties. In both cases a renter must have written permission, and permission cannot be unreasonably withheld (although what ‘reasonable’ means here is unclear, and will likely be up to the courts to determine once reforms begin to take effect).

The reforms also emphasise long-term stability, including removing the 120 day “no specified reason” notice to vacate, limiting rental increases to just once per year, and placing caps on bond. For renters, particularly young families, these changes are a godsend. For many, the promise of long-term housing with limited rental increases and the introduction of optional, five-year leases, removes much of the financial and emotional stress of uncertainty that can accompany renting.

However, investors have expressed concern that the power shift away from property owners is too great. The burden on landlords is massive, with many concerned that the proposed reforms too greatly affect an owners control over their own property. According to REIV Vice President, Leah Calnan, many investors are already pulling out of the market in anticipation of the proposed changes going ahead. Others, concerned with the security of their property under planned reforms, have voiced that rents overall will need to be increased to offset potential losses over time.

Some are optimistic that a decrease in investors will open up the property market to those who otherwise might not be able to afford their own home, however at this early stage it’s difficult to say with any certainty exactly what long term effects the proposed changes will hold.

To learn more, click here to read the official press release from the Andrew Government, dated October 8th 2017.

For more information, click here to visit the official ‘rent fair’ website.

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