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Tenancy Laws

Introduction

New rental laws which set minimum standards for rental properties in Victoria are coming into effect on 29 March 2021, after being delayed due to the pandemic. The new reforms are certain to shake up the real estate market.

The new regulations see more than 130 reforms introduced covering everything from rules around commencing a rental agreement, living in the premises and repairs and modifications to the premises.

These reforms will require substantial changes to process, documents and systems which means that we need to educate ourselves of the new requirements. We address some of these in this guide and discuss what it means for rental providers.

Changes in Terminology

The terminology for residential tenancies is changed as follows:

  • tenants are now renters
  • landlords are now residential rental providers (‘rental providers’)
  • tenancy agreements are now residential rental agreements (‘rental agreements’)
  • rooming house owners are now rooming house operators.

The definitions have not changed.

Changes to the Residential Rental Agreement

Rental agreements have been updated to reflect the new changes in terminology but also include safety related obligations imposed on rental providers and renters throughout the rental agreement. Prohibitions have also been placed on certain terms being included in rental agreements.

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Free Set of Keys to be Provided to Each Renter

The new laws now state that the rental provider must provide, free of charge, a set of keys or another security device to each renter who signed the rental agreement. If both a key and device are required to enable the renter to access and enjoy the rented property, the rental provider must provide both free of charge.

If the renter requests an additional key or device, the rental provider may charge a reasonable fee before giving it to them.

All keys and devices are to be returned at the end of the residency or agreement.

Rental Minimum Standards

Under the new rental laws, residential rental providers must ensure that their rental property meets certain minimum standards. These minimum standards cover basic but important requirements relating to amenity, safety and privacy. Rental providers will have a duty to ensure their property meet these standards.

Below are the minimum standards which must be met on all properties rented from 29 March 2021. The minimum standards laws do no relate to existing rental agreements.

Non-Compliance with Minimum Standards

Rental Providers must ensure that the premises comply with minimum standards before a Renter moves in. If a rented premises does not comply with the minimum standards, the Renter can terminate the rental agreement before they move in, with no recourse, or they can request it as an urgent repair. Rental Providers may incur an infringement notice in excess of $1,900 (or in excess of $9,900 for a body corporate).

Safety Related Activities

Rental providers (and renters) must undertake safety-related activities on the rented premises and are set out in the rental agreement. Where necessary, the activity must be carried out by a suitably qualified person.

Type of safety activity Description Required Action By Evidence Required
Electrical Safety An electrical safety check of all electrical installations, appliances and fittings provided by the rental provider in the rented premises must be conducted every 2 years by a licensed or registered electrician. As soon as practicable after the commencement of a new rental agreement (including lease renewal), upon request by the renter, or after a fixed term tenancy of five years or more rolls over to a periodic tenancy. Certificate of compliance (every 2 years)
Gas Safety A gas safety check of all gas installations and fittings (if any) provided by the rental provider in the rented premises must be conducted every 2 years by a licensed or registered gas fitter. As soon as practicable after the commencement of a new rental agreement (including lease renewal), upon request by the renter, or after a fixed term tenancy of five years or more rolls over to a periodic tenancy. Certificate of compliance (every 2 years)
Smoke Alarm The rental provider must ensure that the rented premises:

  • has smoke alarms installed in the rented property and
  • are tested every 12 months according to the manufacturer’s instructions and
  • the batteries are replaced as required and
  • immediately arrange for replacement or repair for the smoke alarm as an urgent repair if notified by renter that it is not in working order.

 

The rental provider must on or before the commencement of the rental agreement provide to the renter with:

  • information about how each smoke alarm operates
  • information about how to test each smoke alarm
  • information about the renter’s obligations not to tamper with the smoke alarms and to report if the smoke alarm is not in working order.
Within 12 months and before 28 March 2022. Certificate of compliance (annual)
Swimming Pool Barrier Where the rented premises have a swimming pool the rental provider must ensure that a swimming pool barrier / fence:

  • is installed and
  • is in good working order and
  • is immediately repaired or replaced as an urgent repair if it is not in worker order.
Immediate Certificate of Pool Registration

 

and

 

Certificate of compliance for barrier inspection (every four years)

Bushfire Prone Area Where the rented premises is in a bushfire prone area and a water tank is required for firefighting purposes, the rental provider must ensure:

  • that the water tank and any connected infrastructure is maintained in good repair and
  • is full and clean at the commencement of the residential agreement.
Immediate At the commencement of each rental agreement.

Urgent Repairs

The definition of urgent repairs has now been expanded to include repairs or replacements relating to air conditioning, safety devices (including smoke alarms or swimming pool barriers/fences) and any fault or damage which makes the property unsafe or insecure, including pest infestations or mould or damp caused by or related to the building structure.

Additionally, the limit for urgent repairs has been increased from $1,800 to $2,500.

If a renter carries out urgent repairs, they must give the rental provider written notice of the repairs and the cost of the repairs. The rental provider must reimburse the renter for the cost of urgent repairs within 7 days of the renter giving written notice. If the rental provider does not reimburse the renter as required, the renter may apply to VCAT for a compensation or compliance order.

Modifications to the Property

Renters may make certain prescribed modifications to the rented premises without needing to see the rental provider’s consent. These modifications include:

For rented premises that are not registered under the Heritage Act 2017

  • installation of picture hooks or screws for wall mounts, shelves or brackets on surfaces other than exposed brick or concrete walls
  • installation of wall anchoring devices on surfaces other than exposed brick or concrete to secure furniture
  • installation of LED globes that do not require new fittings
  • installation of a water efficient shower head if the original showerhead is retained
  • installation of blind or cord anchors
  • installation of security cameras that are not hard wired, do not impact on the privacy of neighbours and can easily be removed
  • installation of child safety gates (other than on exposed brick or concrete walls).

For all rented premises

  • installation of non-permanent window film
  • installation of a wireless doorbell
  • replacement of curtains (if the original is retained)
  • installation of adhesive child safety locks on drawers
  • installation of pressure mounted child safety gates
  • installation of a lock on the letterbox.

Other modifications which require the rental provider’s written consent and cannot be reasonably refused by the rental provider include:

  • Modifications that are required for health and safety purposes of the renter
  • installation of picture hooks or screws for wall mounts, shelves or brackets on exposed brick or concrete walls
  • installation of wall anchoring devices on exposed brick or concrete to secures furniture
  • installation of child safety gates on exposed brick or concrete walls
  • draughtproofing in rented premises without open-flued gas heating
  • installation of a security system by a suitably qualified person and not impacting on the privacy of neighbours
  • installation of flyscreens on doors and windows
  • painting
  • modification to external gates (for rented premises that are not multi-unit dwellings).

The new laws specifically provide the rental provider with the right to refuse consent in the following circumstances (except where the modifications are also reasonable alterations under the Equal Opportunity Act 2010 and where an occupational therapist or other prescribed practitioner has determined they are required):

  • if a valid notice to vacate has been given to the renter on the grounds of an upcoming change of possession, use or ownership of the rented premises
  • if the modification would significantly change the premises or require modifications to other premises or common areas
  • if the modification would result in non-compliance with any other Act or law (for example, the Building Act 1993)
  • if the modification will result in additional maintenance costs for the rental provider if it is not reversed by the renter at the end of the rental agreement or
  • if reversing the modifications would not be reasonably practicable in the circumstances.

As a condition of their consent, the rental provider may require that the modification be completed by a suitably qualified person. 

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Reversing Modifications

Before the end of the rental agreement, a renter who has installed fixtures, renovated, altered or added to a rented premise (whether or not with the rental provider’s permission) must restore the premises to the condition immediately before the modification (fair wear and tear excepted).

If not, they must pay the rental provider an amount equal to the cost of reversing the modifications.

This does not apply if the renter and rental provider agree, in the rental agreement or otherwise.

Modification Bond

Before consenting to a modification, the rental provider may require that the renter pay an additional bond amount to cover the cost of reversing the modification at the end of the rental agreement, unless:

  • the additional bond amount would be less than $500
  • the additional bond amount is not proportionate to the reasonable cost of reversing the modification at the end of the rental agreement
  • the modification is not required to be reversed at the end of the rental agreement or
  • the rental provider has agreed that the modification is funded by a scheme under a condition that the rented premises does not need to be restored.

The renter may apply to VCAT to determine if the rental provider has unreasonably withheld their consent for a modification. VCAT must hear the application within five days of it being made.

Rental Provider Non-Compliance Register

A new Rental Provider Non-compliance Register (the Register) for rental providers and agents will be established and maintained by Consumer Affairs Victoria (CAV). Rooming house operators, caravan park owners, caravan owners and site owners, and their agents, can also be listed on the Register.

CAV may publish the Register or any information it contains in any form or manner they consider appropriate.

The Register will record details of a rental provider or their agent if VCAT has made a compliance or compensation order against them in respect of a breach of duty under the Act, or if the rental provider or agent has been convicted of an offence under the Residential Tenancies Act 1997.

A listing on the Register must not be kept for more than 3 years.

We are here for you!

With so many changes impacting rental providers, renters and rented premises, we are here to support you every step of the way. Our property managers are here to answer your questions and navigate through these changes and are only a call or email away.

Landlord Rental Premises Self Assessment Checklist

 Click here to access the checklist

The above checklist is intended to assist you in preparing your rental premises to meet the minimum standards and safety standards under the changes to the residential tenancy laws.

Once you have completed this self-assessment checklist, we recommend that you use the information to discuss with your property manager what actions (if any) are required to be taken.