Understanding your rights and responsibilities as a rental provider

It has been 12 months since the amendments to the Residential Tenancies Act (RTA) came into effect. These amendments were a major disruptor which changed the way the industry operates from a renter, rental provider and Property Management perspective. Here we revisit some of the main changes to the RTA as they pertain to the rights and responsibilities of rental providers.

Changes to securing a renter

1. Fixed price rentals

The rental price on listings must be fixed and potential renters cannot submit ‘rental bids’ above the asking price.

2. Maximum bond amounts

A bond equivalent to a maximum of one calendar month’s rent can be requested from new renters for properties under $900/week. A rental provider can only request an additional bond amount for long-term rental agreements if the renter has signed a five years fixed term agreement and they have been provided at least 120 days’ notice.

Changes to managing a tenancy

1. Basic minimum standards

Rental properties must now conform to basic minimum standards. Among others, this includes:

• The installation of shower heads with an efficiency rating of 3 or above
• A cooktop with two or more burners
• The installation of a fixed heater in good working order in the main living room
• Curtains or blinds to be fitted to any room that is likely to be used as a bedroom or living area (from March 29, 2022) for privacy and to block light.
• The fixed heater will be required to be energy efficient, for example with an energy efficiency rating of at least 2 stars (from 2023)

2. Safety compliance

Smoke alarms - Smoke alarms must be installed in all Victorian homes, units, flats and townhouses. Rental providers are responsible for fitting and maintaining smoke alarms in rental properties. Hard-wired smoke alarms with a battery back-up must be installed in all buildings constructed after 1 August 1997. Buildings constructed before that date may have a battery-powered smoke alarm. Smoke alarms must be tested annually in accordance with the manufacturer’s instructions.

Gas and electrical safety checks - Safety checks for gas and electrical appliances and fittings are compulsory every two years and the reports must be retained and provided to a renter upon request. An upgraded switchboard with a circuit breaker and residual current device is also a requirement by 2023.

3. Urgent repairs

Renters can now spend up to $2500 for an urgent repair and be reimbursed by the rental provider if they have made a reasonable attempt to contact the rental provider or agent and did not receive an immediate response. Previously this amount was $1800. The following are examples of urgent repairs:

• Burst water service
• Blocked or broken toilet system
• Serious roof leak
• Gas leak
• Dangerous electrical fault
• Flooding or serious flood damage
• Failure or breakdown of any essential service or appliance provided by a rental provider or agent for hot water, water, cooking, heating or laundering
• Failure or breakdown of the gas, electricity or water supply
• Any fault or damage on the premises that makes the premises unsafe or insecure
• An appliance, fitting or fixture that is not working properly and causes a substantial amount of water to be wasted
• A serious fault in a lift or staircase
• A fault to a smoke alarm, pool fence or cooling system
• A serious pest infestation
• The presence of mould or damp related to the building structure

4. Modifications by a renter

Renters may now make certain modifications to a rental property without requesting the Rental Provider’s approval (e.g. installation of picture hooks other than on an exposed brick or concrete wall and certain security devices). For modifications where rental provider approval is required it may not be unreasonably withheld.

5. Renters and pets

Renters may request consent of the rental provider to have pets at their property. If the rental provider would like to refuse permission, they must apply to VCAT within 14 days of the request for an order that it is reasonable to do so or the request is deemed to have been accepted.

Changes to ending a tenancy

1. Evictions for repeated late rents

Under the new rules, when a renter pays overdue rent within 14 days of receiving a Notice to Vacate by the rental provider, the notice is no longer valid. This can occur four times in a 12-month period. If rent is late a fifth time, the rental provider can apply to VCAT for a possession order. VCAT may choose to then place the renter on a payment plan rather than proceed with a possession order.

2. Valid reasons for ending a tenancy

Rental providers may no longer issue a ‘no specified reason’ Notice to Vacate. This has been replaced with the 'End of Fixed term tenancy' which can only be issued prior to the end of the initial fixed term, not any subsequent terms.

Valid reasons to issue a Notice to Vacate include: sale, change of use, demolition or intention for the owner to occupy.

Under the reforms, a Notice to Vacate may now be issued for a new reason: ‘threats and intimidation’. This can be invoked if the Renter or a visitor of the Renter has seriously threatened or intimidated the Rental Provider, agents or contractors.

For further information, contact your Property Manager or read more on the Consumer Affairs Victoria website.