What’s changed: New VIC residential tenancy laws

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What’s changed: New VIC residential tenancy laws
Posted by
on Oct 20, 2020

Originally set to come into effect on 1 July 2020, the start date of the Residential Tenancies Amendment Act 2018 was delayed indefinitely due to the coronavirus pandemic. While some of the changes have already been implemented, Consumer Affairs Victoria (CAV) just announced that all amendments will be implemented by 29 March 2021.

There are 132 reforms in total. Here’s a breakdown of the main changes in the new VIC residential tenancy laws.

1. Terminology changes

The new VIC residential tenancy laws refer to landlords as rental providers, tenants as renters, tenancy agreements as rental agreements, and rooming house owners as rooming house operators. As such, the below changes will reflect the updated terminology.

2. The end of no-grounds evictions

To end a rental agreement, rental providers must provide a valid reason such as sale, change of use or demolition of the rental property, or the rental provider moving back into the rental property. For change of use, rental providers must attach documentary evidence to a notice to vacate, as specified by the Director of CAV.

3. Notice to vacate changes

Rental providers can issue a notice to vacate if:

  • The renter or their visitor endanger the safety of neighbours, the rental provider or their agent, or a contractor or employee of the rental provider or their agent
  • The renter or their visitor has seriously threatened or intimidated the rental provider or their agent, or a contractor or employee of either the rental provider or their agent
  • A renter or their visitor, by act or omission, intentionally or recklessly causes serious damage to the rented property, including to any safety equipment or common areas

4. Ban on rental bidding

Moving forward, rental providers and agents are banned from inviting rental bids and can only advertise or offer rental properties at a fixed price.

5. Where and how rent is paid

While any method for rent payment can be specified in a rental agreement, the rental provider must offer at least one accessible, fee-free method of payment and must permit payments via Centrepay. Rental providers must also disclose any costs associated with the nominated method prior to the renter entering the agreement.

6. Added transparency and protections for renters

The new reforms will increase transparency and protections for renters. Rental providers and agents cannot:

  • Encourage someone to enter into a rental agreement by making false or misleading representations
  • Request inappropriate information in a rental application
  • Unlawfully discriminate against renters i.e. refusing to rent a property to an applicant, issuing a notice to vacate or determining consent for disability related modifications
  • Rental providers and agents can only use personal information disclosed in a rental application to assess the applicant’s suitability as a renter.

Additionally, renters can request a free copy of their personal information listed on a renter database once every 12 months.

7. Bond obligations

Renters will no longer need the rental provider’s permission to have all or part of their bond released. They can apply to the Residential Tenancies Bond Authority (RTBA) and the rental provider will have 14 days to dispute the claim.

Furthermore:

  • In long-term agreements of more than five years, rental providers can request an additional bond if the renter has lived at the rental property continuously for five or more years, as long as the rental provider gives at 120 days’ written notice
  • It will be more difficult for rental providers to request a bond or rent in advance of more than one month’s rent as the rental cost threshold has been increased

8. Rent increases and lease break

Effective 19 June 2019, rental providers can only increase rent once every 12 months instead of every six months. This applies for leases entered into on or after 19 June 2019.

Here are some other changes to rent increases and lease break:

  • For fixed-term agreements, rent increases can only occur if the rental agreement specifies the amount or method of the rent increase
  • When making a compensation order for lease break, VCAT must consider the severe hardship the renter may have suffered due to an unforeseen change in circumstances, if the agreement had continued
  • Certain circumstances such as being accepted into social housing allow renters to give 14 days’ notice of intention to vacate without paying lease break fees

9. Ending fixed-term agreements

For fixed-term agreements of less than five years, rental providers can only issue a notice to vacate at the end of the first fixed-term.

Moreover, a notice to vacate for the end of a fixed-term agreement can be flexible. It can specify a date on or after the end date specified in the agreement.

10. Rent arrears and non-payment of rent

If a renter falls into arrears but pays back overdue rent within 14 days, any notice to vacate that was issued for that overdue rent is invalidated. However, this applies for the first four occurrences in a 12-month period.

If the renter continues to fall into arrears or fails to pay rent a fifth time in the same 12-month period, the rental provider may issue a notice to vacate and apply to VCAT for a possession order.

11. Renting with pets

Effective 2 March 2020, renters can now keep pets at a rental property with the rental provider’s consent. A rental provider cannot unreasonably refuse a request to keep a pet. If there is reasonable grounds to refuse permission, a rental provider can apply to VCAT for an order.

Note that these laws do not apply to pets already present before 2 March 2020. Learn more about pets and renting here.

12. Making modifications

Renters will be able to make prescribed modifications without the rental provider’s consent and rental providers cannot unreasonably refuse consent to some modifications. The full list of prescribed modifications will be decided by April 2020, following public consultation.

13. Minimum rental standards

Rental providers must ensure their rental property meets the minimum rental standards related to amenity, safety and privacy before a renter moves in, and condition reporting is required regardless of whether a bond is taken.

Note that the final list of minimum standards will be in the Residential Tenancies Regulations 2020, which will be made before 29 March 2021.

If the rental property does not meet the minimum rental standards, the renter can terminate the rental agreement before they move in or they can request an urgent repair at any time after they move in.

14. Urgent repairs

Under the new reforms, urgent repairs include repairs and replacements relating to air conditioning, safety devices, and any fault or damage which makes the rental property unsafe or uninhabitable.

Additionally:

  • The guidelines for urgent repairs will be issued by the Director of CAV to clarify timeframes
  • The money limit for urgent repairs reimbursement has been increased
  • The rental provider must reimburse the renter for the reasonable cost of urgent repairs within seven days of the renter giving written notice
  • For non-urgent repairs, renters can apply directly to VCAT if the rental provider has not carried out the notified repairs within 14 days.

15. Protection for family and personal violence victims

Victims of family and personal violence will be able to terminate their tenancy to ensure they aren’t held liable for the debts of the perpetrators.

In the event that a tenancy is terminated due to family or personal violence, rental providers and their agents are prohibited from listing the victim on a residential tenancy database.

In addition, VCAT can be nominated to serve documents on a perpetrator of family or personal violence and must hear family or personal violence related applications within three business days.

16. Rental non-compliance register

In addition to VCAT being able to order the agent disclose the rental provider’s details for the purpose of legal proceedings, rental providers found by VCAT to have committed an offence under the Residential Tenancies Act 1997 will have their name, rental property address and nature of their offence listed on the CAV rental non-compliance register.

17. Formalising and enforcing rental agreements

Under the new VIC residential tenancy laws, VCAT can formalise rental agreements and enforce unsigned rental agreements:

If an informal rental agreement already exists, a renter can apply to VCAT for an order requiring the rental provider to enter a written rental agreement with the renter

If the renter has signed the rental agreement and the rental provider has not signed, but has accepted rent, the agreement is enforceable

18. Caravan parks and residential parks

In the event of caravan or residential park closure, the park operator must provide the local government at least 14 days’ notice before issuing a notice to vacate to park residents. If the park closes, eligible park residents will be offered access to compensation.

Other reforms unique to caravan parks and residential parks include:

  • Site tenants can request that the park operator recognises a person residing with them in their dwelling as a site tenant and to add them to the agreement
  • A site tenant can use their site for non-residential purposes if they obtain the park operator’s written consent.
  • Park operators must give residents seven days’ notice of any proposed changes to park rules
  • Park residents who own their dwellings must meet minimum amenity and safety conditions
  • The urgent and non-urgent repairs processes that exist in the Residential Tenancies Act 1997 for caravans will be extended to cover caravan sites
  • Rent increases can be specified in residential park site agreements as long as they are by a fixed amount according to a specified calculation method or by a non-fixed amount
  • Urgent and non-urgent repairs processes have also been introduced for residential park sites and the park operator is responsible for these repairs
  • The park owner must repair any damage or breakdown of communal facilities reported by residents as soon as practicable

19. Long-term leases

Effective 1 February 2019, renters and rental providers can enter a fixed-term rental agreement for longer than five years but must use the prescribed form to do so. If the long-term lease agreement is non-compliant, a renter can give a rental provider 28 days’ notice of intention to vacate.

When the fixed-term period ends, the agreement will automatically transition to a periodic agreement unless the renter and rental provider agree to extend the term. Rental providers can also require an additional bond every five years in a long-term lease, as long as they provide the renter 120 days’ notice.

Lastly, after the end of the first fixed-term period, a rental provider can give a renter under a long-term lease a fixed-term notice to vacate.

20. Exemption for existing rental agreements

For existing rental agreements signed before 1 July 2020, rental providers and renters will be exempt from some of the new rental laws until that agreement is terminated and a new agreement is signed.

When do these new rental laws come into effect?

Some of the reforms have already been implemented, but the remainder of the new VIC residential tenancy laws will come into effect by 29 March 2021.

Note that the Victorian Government has replicated a small number of provisions relating to family violence and rental agreements from the Residential Tenancies Amendment Act 2018 into the new laws addressing the moratorium on evictions for non-payment of rent due to COVID-19.

For more information, please visit CAV and Victorian legislation:

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