New Rental Laws – Updates Landlords and Tenants Need to Know
Changes to residential tenancies are set to come into effect on 29 March 2021, pursuant to the Residential Tenancies Amendment Act 2018 (Vic) and Residential Tenancies Regulations 2020 (Vic). Whilst some of the changes came into effect last year, the remainder were placed on hold due to the coronavirus pandemic and are only now coming into force. Overall, the changes include harsher obligations on landlords and grant more rights and freedoms to tenants.
Beginning at the commencement of the rental relationship, there are changes to the grounds upon which a prospective tenant can be refused and the information that they are required to provide to the landlord. In particular, a landlord cannot discriminate against a prospective tenant. The grounds for protection are set out in the Equal Opportunity Act 2010 (Vic), but include attributes such as age, race and gender identity.
In terms of advertising properties to rent, all properties must now have a fixed rental amount. This will prohibit offering a weekly or monthly rental range, which may encourage bidding between prospective tenants.
The landlord must provide improved living standards to tenants. This includes:
- Fitting showers with three-star shower heads;
- Providing a working stove;
- Having a functional sink in the kitchen;
- Ensuring that the property is free of mould;
- That there is appropriate lighting and ventilation;
- That there is heating in the main living area – if heating needs to be installed, it must be energy efficient.
In addition to these changes, leases commencing on or after 29 March 2021 must have a licensed or registered electrician and gas fitter conduct an electrical or gas safety check within the past two years. Moving forward, the electricity or gas then has to be checked every two years.
Tenants will also be permitted to make changes to the property without approval from the landlord. These changes do not differ from those previously proposed, which include installing picture hooks and shelving. However, the tenants do not have unfettered power to change the property. For example, if the tenant wants to paint the property, they must notify the landlord and the landlord must not unreasonably refuse.
Rental increases under a fixed term lease (for example, a two year lease), can only occur if the lease specifies the amount and method of the rent increase. This works alongside the changes brought into effect last year which only allow a rent increase once every 12 months (rather than every 6 months).
There will be a maximum amount of bond that can be obtained by a landlord. The maximum will be one month’s rent.
However, there is also a significant change as to the procedure for releasing the bond at the conclusion of the lease. A tenant will no longer need the landlord’s permission to have all or part of their bond release. The tenant will be able to apply to the Residential Tenancies Bond Authority for the release of their bond. However, there will still be protections afforded to landlords which grant them 14 days to dispute the release of the bond.
If your lease is affected by the new rental changes or you are unsure of your rights or obligations, we recommend you seek legal advice. Should you need assistance, please contact a member of our firm on (03) 9481 2000 or email@example.com.