Login
iscover
The Real Estate Institute of Victoria has warned that the state’s most disadvantaged tenants will be the hardest hit if proposed reforms of the Residential Tenancies Act are adopted.
REIV says it is ironic that the reforms are designed to improve conditions for the very tenants they will hurt.
The institute’s CEO Gil King said that the state government has failed to consider the most basic economic logic. He said if costs rise for landlords and property investment is no longer viable, rents will rise and supply of rental properties will be affected.
“Landlords have told us as much,” Mr King said.
In an REIV survey of more than 3,500 landlords, 80 per cent of respondents said that if costs rise they would increase rents. Almost 20 per cent said they would exit the property market.
“The majority of Victorian landlords are not large institutional ‘fat cat’ investors with access to significant funding pools,” Mr King said.
“In fact, more than 75 per cent of Victorian landlords are mum and dad property owners with only one or two properties for lease. These investors often heavily rely on rental income to meet their monthly mortgage commitments.”
The proposed changes come at a time of unprecedented population growth, with more than 100,000 new residents expected every year.
“It’s also important to note that Victoria’s proportion of social housing is the lowest in Australia and also one of the lowest in the Western world,” Mr King, adding that the latest figures suggest at least 30,000 Victorians are on the waiting list for social housing.
“And costs will undoubtedly rise for landlords under the proposed reforms. The Andrews government proposes to implement additional minimum property standards, despite minimum standards already existing under the Victorian building code and regulations, and 70 per cent of tenants reporting their property to be in an excellent or good condition.
“This means rental properties will need to be of a higher standard than those where the owner occupies the premises.”
Mr King added that landlords have already been hit with increased land tax and property rates, up 150 per cent in some areas.
Under the proposed reforms, landlords will no longer be able to end a tenancy at the conclusion of a fixed-term agreement nor will they be able to end a periodic tenancy (month-to-month). If landlords wish to change the use of the premises – for example, move back into the property – they will need to provide tenants with 90 days’ notice.
Outside of a fixed-term lease, tenants are only required to provide landlords with 28 days’ notice of their intention to leave the property, without specifying a reason.
The proposed options also involve removing the landlord’s right to allow/disallow pets and non-structural modifications.
You are not authorised to post comments.
Comments will undergo moderation before they get published.