The Real Estate Institute of Victoria (REIV) CEO, Gil King has spoken out against the new Victorian rental laws, arguing they are unfair for landlords, investors, and property owners.
Renters in Victoria will soon enjoy the strongest protections in the country, after the Andrew's Labor Government passed new laws to make renting fair for all Victorians.
But not everyone is in favour. Gil King, CEO of the Real Esate Institute of Victoria (REIV) argues they're unfair for landlords.
The REIV has campaigned strongly against elements of the legislation, which they argue will "swing the pendulum of rights overwhelmingly over to renters".
The highly-anticipated rental reforms, which were passed in Parliament last month, give renters more rights, protect vulnerable tenants, and enable people to turn the property they rent into a home by making modifications.
Currently, more than one in four Victorians are renters.
In Melbourne, the recently passed changes for the Residential Tenancies Amendment Act 2018 looked at issues including:
What do the new laws entail?
The new laws will ensure every rental home meets basic code - with functioning stoves, heating, and deadlocks. The law also requires landlords to meet basic safety standards for gas, electricity, and smoke alarms.
Rental bidding will be heavily cracked down on, with rent increases limited to once per year, and bonds capped at four weeks rent.
Renters will also be given the right to make minor modifications, such as nailing a hook on the wall or installing anchors to stop furniture from falling on children - without needing the landlords prior consent.
Under the new laws, rental homes will need to have functioning stoves, gas, and electricity. Image by Aaron Huber via Unsplash.
Meanwhile, protections for pet owners will also be stronger, with residential rental providers only able to refuse the right of a tenant to have a pet by order of the Victorian Civil and Administrative Tribunal.
Under the new laws, renters will also be able to receive their bond back quicker. Tenants will be able to apply for the release of bond without written consent from their landlord, who will have 14 days to raise a dispute before it is automatically repaid.
Rental agreements will also be terminated in situations of family violence. The change will ensure victims are not held liable for the debts of their abusers, implementing the Royal Commission into Family Violence's recommendation to better protect and support victims of family violence living in rental housing.
Those living in caravan and residential parks haven't been forgotten about either - under the new laws, compensation will be provided if their park closes.
Related reading: Victoria's rushed long-term tenancy legislation unattractive for landlords: REIV
Rights of entry and photography when a rental property is being sold will be clarified, as well as rules regarding what happens with goods left by a renter at the end of their tenancy.
“These new laws are the biggest reforms to renting in Victoria’s history and are about ensuring everyone who rents has a safe and secure home to call their own," Minister for Consumer Affairs Marlene Kairouz said.
“We said we’d make renting fair, and that’s what we’re delivering.”
But not everyone agrees.
REIV CEO Gil King says the new laws will "result in an unfair, unworkable and impractical system".
"When the Premier announced the Residential Tenancies Amendment Bill, he said its purpose was to ‘fix the system and make renting fair for all Victorians’, but the legislation is certainly not fair for investors, property owners and landlords," Mr King said.
"It will result in an unfair, unworkable and impractical system which would rob landlords of their right to consent to what goes on in their properties, burden them with unrealistic expenses to upgrade appliances and could mean they are not paid their rental on time for four out of every 12 months without any recourse."
Mr King says landlords could be up for thousands of dollars to bring appliances up to code.
"It is simple economics that if it costs thousands to change ovens, refrigerators, heating, cooling, dishwashers, washing machines, dryers, light fittings etc, then rents will increase to cover those costs. For older style apartments, it is not as simple as removing appliances – particularly where they have been built in.
"Owners will be up for thousands of dollars particularly where substantial modifications are required. To think that this will not be reflected in rent increases defies basic market economics," Mr King continued.
And as for allowing pets in rentals, Mr King says this will "effectively extinguish a landlord's fundamental property right".
"The landowner has the principle interest in the property and should therefore determine what occurs in that property.
Protections for pet owners will be stronger under the new rental laws. Image by Wade Austin Ellis via Unsplash.
"From every legal perspective, the property owner is responsible and liable for what occurs in and around that property. You may have costs associated with that pet including presumably fencing, security gates and the like. On top of that, you will be responsible for cleaning the premises after the pet and the tenant have left."
While tenants will undoubtedly be in favour of the ability to make minor modifications without needing their landlords' approval, Mr King argues this may be in breach of Body Corporate rules.
"There are thousands of new apartments that contain fixtures and fittings, chattels and the like that are subject to warranties. Any modifications to such fixtures, fittings and chattels will affect warranties. Modifications may also contravene Body Corporate rules. The only person who should be entitled to make decisions about modifications is the landlord."
Read the Residential Tenancies Amendment Act 2018 here.
Related reading:
Investors and renters ready for build-to-rent sector in Australia, report finds