Legislation Reforms

Modern Regulation and Processes

Reform 1. The terminology for residential tenancies will be updated as follows:

• Tenants will be referred to as renters
• Landlords will be referred to as residential rental providers (RRPs)
• Rooming house owners will be referred to as rooming house operators

Reform 2. The Residential Tenancies Act will include new legislative objectives that reflect its role in the modern regulation of rental accommodation.

Reform 3. A Commissioner for Residential Tenancies will:

• champion the rights of Victorian renters, with a focus on renter experiences in the private rental sector
• help identify systemic issues with the law and practices that could inform future policy, regulatory responses, education programs and resources, and improved dispute resolution services.

Reform 4. During the implementation of the Bill, Consumer Affairs Victoria will review all sources of information for market participants, to ensure they have access to high-quality, effective educational tools that help them to understand their rights and obligations.

Reform 5. Civil pecuniary penalties will be introduced for specific breaches of the Residential Tenancies Act, together with a public warning power for the Minister and Director of Consumer Affairs Victoria, as well as powers specifically tailored to ensure compliance with proposed key obligations (such as minimum standards and the prohibition on soliciting rental bids).

Reform 6. The maximum criminal penalties for the majority of existing offences will be increased 2.5 times and applied to a number of contraventions by the RRP and, in limited circumstances, by the renter. This aims to encourage greater compliance with the legislation.

Reform 7. A new Rental Non-compliance Register for RRPs and agents will be established and maintained by the Director of Consumer Affairs Victoria. This will enable renters to identify those who have previously breached their obligations under the Residential Tenancies Act. A listing for the RRP or the agent will be made if VCAT has made a compliance or compensation order in respect of a breach of duty under the Act, or if the RRP or agent has been convicted of an offence under the Act.

Before a Residential Rental Agreement

Reform 8. Inappropriate questions in a residential rental application form will be able to be prohibited through regulations, should certain types of questions become problematic in the Victorian market in the future. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 9. Unlawful discrimination is prohibited under the Equal Opportunity Act 2010. The Residential Tenancies Act will now clarify that RRPs must not unlawfully discriminate (or instruct their agent to unlawfully discriminate) when:

• refusing to let a property to an applicant
• refusing consent to modifications, sub-letting or assignment, or
• issuing a notice to vacate.

Applicants and renters in these circumstances will have a right under the Residential Tenancies Act to seek compensation if they have suffered loss as a result of this unlawful discrimination. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 10. Rental application forms will be required to include a prescribed information statement that educates applicants, RRPs and agents about unlawful discrimination. This reform will also apply to residency applications in rooming houses, caravan parks and residential parks.

Reform 11. Private RRPs and smaller commercial agencies are not bound by the Australian Privacy Principles in the Privacy Act 1988. This reform will prohibit all RRPs and agents from misusing information in a residential rental application. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 12. RRPs and their agents will be prohibited from inducing someone to enter a residential rental agreement by misleading or deceptive conduct (for example, if the agent tells a prospective renter that the house has a high-speed internet connection, when the agent knows this is not the case).

Reform 13. Before entering into a residential rental agreement, the RRP will now be required to disclose:

• any ongoing proposal to sell the property
• any ongoing mortgagee action to possess the property
• that the RRP has a legal right to let the property (if the RRP is not the property owner)
• details of any embedded electricity network
• any other prescribed matters, such as the presence of asbestos.

This reform also applies to rooming houses, caravan parks and residential parks.

Reform 14. Sometimes, if a RRP is using an agent, the renter will only have the full name and address of the agent, not the RRP. If the RRP’s details are needed for the purposes of legal proceedings, VCAT will be able to order that the agent disclose the RRP’s name and address.

Reform 15. As part of the broader modernisation of rental laws, the Act will be amended to authorise digital delivery of critical information, such as the ‘Red Book’ outlining the parties’ rights and responsibilities.

Reform 16. The prescribed standard form for a residential rental agreement will be updated and modernised.

Reform 17. Not all residential tenancies are in writing. Where, for all intents and purposes, a person is being treated as a renter by their rental provider, the Act will allow them to apply to VCAT for an order requiring the RRP to enter into a written residential rental agreement. This is aimed at providing a sense of security that the Act applies to the parties’ relationship. This reform also applies to rooming houses and residency in caravan parks.

Reform 18. The Act will be amended to clarify that a renter who does not have a properly executed residential rental agreement (that is, the RRP has not signed the agreement) will nevertheless benefit from the protections in the Act as if the agreement had been properly signed from the beginning. This reform also applies to site agreements in residential parks.

Reform 19. To prevent residential rental agreements from including particular detrimental additional terms, those terms will be prescribed in regulations as prohibited terms. It will be an offence to include a prohibited term in a residential rental agreement. This reform also applies to agreements for rooming houses, caravan parks and residential parks.

Reform 20. Any requirement in the residential rental agreement specifying that the renter must have the property professionally cleaned before vacating the property will only be valid if such cleaning was needed to return the property to the condition it was in at the start of the tenancy, taking into account fair wear and tear. This reform also applies to agreements for rooming house rooms and caravans.

Reform 21. A RRP will be required to give each renter listed on the residential rental agreement a key and/or other access device for the property free of charge, but can charge a reasonable fee for an additional key/device requested by the renter.

Rent and Bonds

Reform 22. Rental properties must be advertised at a fixed price, and RRPs and agents cannot request or solicit rental bids. The reform does not prevent RRPs and agents from accepting a rental bid if it is offered unprompted by a prospective renter. Solicitation of bids exacerbates the imbalance of power between RRPs and renters, who may feel pressured to pay more than they can afford in order to get a rental. The reform leaves market participants to choose if they want to offer a bid, rather than in response to opportunistic price-gouging by RRPs and agents.

Reform 23. Rent increases will be limited to no more than once per year. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 24. For rent increases that occur during a fixed-term residential rental agreement, the amount or method of calculation for the increase must be set out in the agreement (for example, no more than X per cent in a 12 month period).

Reform 25. RRPs must provide at least one reasonably available fee-free method of paying rent. RRPs will also be required to inform renters about any extra costs involved with a particular method of rent payment before they consent to use it. This reform also applies to payment of rent in rooming houses, caravan parks and residential parks.

Reform 26. RRPs will be required to permit rent payments via Centrepay. This reform will address the current practice where some RRPs reportedly refuse to accept rent payments through Centrepay, and will also apply to rental arrangements in rooming houses, caravan parks and residential parks.

Reform 27. The cap of one month’s rent for both bonds and rent in advance will still apply with an exemption for high-value properties and VCAT discretion to set a higher amount. The current high-value exemption (for properties with a weekly rent of more than $350) will be updated to reflect market rents and set at twice the median rent for Victoria. This reform also removes the current exemption when a property is the RRP’s principal residence. This reform also applies to high-value exemptions for bonds in residential parks.

Reform 28. Given the introduction of new long-term leases and requirements for RRPs to allow property modifications, RRPs will be able to take additional bonds for long-term leases and in respect of a renter’s obligation to restore any modification.

Reform 29. Renters can apply to the Residential Tenancies Bond Authority (RTBA) to have all or part of the bond released either with or without the RRP’s consent. If both parties have agreed, the RTBA will pay out the bond in accordance with instructions from the parties as to any apportionment. If the renter is applying without mutual consent, the RTBA will notify the RRP, who then has 14 days to notify the RTBA if they are disputing the claim. If not, the bond will be automatically paid out. RRPs will still have to apply to VCAT if claiming from the bond without the renter’s consent. This reform also applies to bonds in rooming houses, caravan parks and residential parks.

Reform 30. Currently, the parties to a residential rental agreement can mutually agree to the release of the bond at any time before the agreement has ended. A renter can also apply for their bond to be released seven days before the end of the agreement, subject to the RRP agreeing to the arrangement.

To help alleviate financial stress, and to better facilitate these private agreements between existing renters and RRPs, renters will be able to seek agreement from their RRP up to a month before the end of the agreement for their bond to be released early. If the RRP agrees, the bond can be paid out as agreed up to 14 days before the end of the agreement, rather than the current period of 7 days. This reform also applies to bonds in rooming houses, caravan parks and residential parks.

During a Residential Agreement

Reform 31. Renters will be required to obtain their residential rental provider’s (RRP) consent to keep a pet. However, the RRP will be taken to have consented to the pet unless they apply to VCAT within 14 days. VCAT can order that the renter is permitted to keep a pet on the property, or may decide that it is reasonable to refuse consent and make an order excluding the pet from the property. The RRP can terminate the lease if the renter does not comply with an order excluding the pet from the property. The factors that VCAT may consider when determining whether it is reasonable to refuse consent to keeping a pet are:

• the type of pet the renter proposes to keep, or is keeping, on the property
• the character and nature of the property
• the character and nature of the appliances, fixtures and fittings on the property
• whether refusing consent to keep the pet on the property is permitted under any Act
• any prescribed matters
• anything else VCAT considers relevant.

Reform 32. Renters will be able to make certain prescribed minor modifications without the consent of the RRP. Other types of modifications (including disability-related modifications) will require the RRP’s consent, which cannot be unreasonably refused. Modifications will need to be made carefully and using a suitably qualified person in some instances. If the RRP asks, the renter will also need to restore any changes or face losing their bond to cover the cost if the RRP has to do it. Renters will remain responsible for restoring any changes made to the property and will be able to lodge a restoration bond to cover the future removal of fixtures. Consent to fixtures is not dependent on whether the renter can lodge a restoration bond. However, it does illustrate that they will be able to meet their obligation to restore the property if requested.

A restoration bond will not be required if:

• the amount in question is less than $500
• the amount requested does not reflect the reasonable costs of restoring the premises
• the RRP has agreed to leave the modification in place without the need for restoration, or
• the modification has been funded by a scheme, and it is a condition of the grant that the RRP must agree to leave the modification in place and not require the renter to restore the property when they leave.

Whether a modification is authorised or unauthorised, it is still the center’s renter’s duty to redress any resulting damage to the property. For modifications in rooming houses, caravan parks and residential parks, operators will be required to not unreasonably refuse consent to disability-related modifications.

Reform 33. If a residential rental agreement is being assigned to a new renter, the RRP will only be able to charge reasonable fees that are reasonably incurred by the RRP because of the assignment of the agreement. This reform also applies to site agreements in residential parks.

Reform 34. Where a renter or RRP gives the other person a breach of duty notice, the person in breach will be required to remedy the breach if possible and, if the breach has resulted in loss or damage to the other person, compensate that other person. This reform will address current confusion about whether, if compensation is paid, there is still an obligation to remedy the breach. This reform will also apply to breaches of duty in rooming houses, caravan parks and residential parks.

Reform 35. If a renter causing a nuisance is served a breach of duty notice but does not comply, the RRP can’t take further steps (such as apply to VCAT or compliance order or issue a second breach notice) for 14 days. This timeframe will be shortened to 7 days, to allow RRPs to deal more effectively with wilful nuisance while not unduly penalising renters. This reform will also apply to a breach of duty for nuisance by a site tenant in a residential park.

Reform 36. If a RRP who is not ensuring the renter’s quiet enjoyment is served a breach of duty notice but does not comply, the renter can’t take further steps (such as apply to VCAT or compliance order or issue a second breach notice) for 14 days. This timeframe will be shortened to 7 days, to allow renters to deal more effectively with intrusions on their quiet enjoyment while not unduly penalising RRPs. This reform will also apply to a breach of duty for the site tenant’s quiet enjoyment in a residential park.

Property Conditions

Reform 37. There will be clearer obligations for residential rental providers (RRPs) to provide and maintain the property in good repair, and in a reasonably fit and suitable condition for occupation, despite the age and character of the property. This reform is intended to address a mistaken belief among some RRPs and their agents that it is unnecessary to undertake repairs to premises that are old and run-down, and that a renter should accept a property in disrepair if they have agreed to pay a lower rent.

Reform 38. RRPs will be required to ensure that the rental properties they let out comply with prescribed rental minimum standards. The minimum standards that will be prescribed will include basic, yet critical requirements relating to amenity, safety and privacy, such as:

• a vermin proof rubbish bin
• a functioning toilet
• adequate hot and cold water connections in the kitchen, bathroom and laundry
• external windows that have functioning latches to secure against external entry
• a functioning cooktop, oven, sink and food preparation area
• functioning heating in the property’s main living area
• window coverings to ensure privacy in any room the owner knows is likely to be a bedroom or main living area.

RRPs will be given time to bring their properties up to scratch before the minimum standards come into effect.

Reform 39. The power to prescribe rental minimum standards has been flexible designed, so that it can incorporate standards imposed under other Victorian legislation, such as energy and water efficiency requirements.

Reform 40. If a property does not comply with the prescribed rental minimum standards, the renter can terminate the residential rental agreement before they move in, or they can move in and request compliance as an urgent repair. If the RRP fails to bring the property up to standard following the urgent repair request, VCAT can order that the rent be redirected into the Rent Special Account.

Reform 41. Insurance companies commonly require deadlocks as a condition of obtaining full insurance cover, meaning that renters who live in a property without a functioning deadlock may not be eligible for compensation in the event of a burglary. RRPs will be required to ensure that any external doors are secured with a functioning deadlock. Deadlocks on windows are not recommended due to concerns about obstructing access to or from the property in an emergency.

Reform 42. A more robust condition reporting process will clarify obligations to complete a condition report at the start and end of a residential rental agreement. Condition reporting will be required regardless of whether a bond is taken at the start of the rental agreement. Electronic reporting will be permitted by the Residential Tenancies Act.

A RRP will also be required to complete a report at the end of a residential rental agreement, and to give the renter an opportunity to agree to the report. Renters and RRPs will also be able to have the condition report amended, whether or not the report has been signed. This reform also applies to condition reporting in rooming houses, caravan parks and residential parks.

Reform 43. The Director of Consumer Affairs Victoria will issue maintenance guidelines which must be taken into account by VCAT when determining a dispute about maintenance. The guidelines will list maintenance activities for which the RRP and renter are responsible. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 44. The Director of Consumer Affairs Victoria will issue guidelines setting out examples or instances of cleanliness and repair. VCAT will be required to have regard to the guidelines when determining related disputes. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 45. The Director of Consumer Affairs Victoria will issue guidelines clarifying the meaning of damage and fair wear and tear. VCAT will be required to have regard to the guidelines when determining related disputes. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 46. The duties for renters around reasonable cleanliness and avoiding damage will be clarified to take fair wear and tear into account. Renters will be required to leave the property reasonably clean and in the same condition as at the start of the tenancy, taking into account fair wear and tear to the property. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 47. Renters or their visitors must not intentionally or negligently cause or permit damage to the property and common areas, and renters must notify the RRP as soon as practicable of any damage to the property. Damage does not include fair wear and tear caused by a renter or visitor.

Reform 48. If a renter causes damage to the rented premises, the RRP may give the renter a repair notice, and the renter is liable for the cost of repairing damage they caused. Amendments will allow the renter to seek an extension of time at VCAT to the 14-day period for complying with a request from the RRP to repair damage to the property, or to reimburse the RRP for any remedial action they have taken to repair the damage.

Reform 49. VCAT will be required to take depreciation into account when assessing an RRP’s claims for compensation for damage to rented premises. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 50. Renters will be required to report damage or breakdown of facilities in the property. A renter who becomes aware of the need for a repair to the premises will have to give notice as soon as possible to the RRP or agent. The aim of this reform is to minimise any reluctance the renter may feel to request a repair that has not previously been documented (for example, in the condition report), and to ensure that RRPs are able to prevent damage to the property that would occur if a repair was unnecessarily delayed. A failure by the renter to report a defect would not lead to a breach of any other duty. However, if the renter subsequently alleges that the RRP did not comply with their repair obligations, or tries to claim damages for reduced amenity, VCAT will be able to consider whether, and when, the RRP was actually notified of the problem.

Reform 51. If a residential rental agreement includes a prescribed term setting out safety-related activities (such as testing smoke alarms) that must be completed during the tenancy, the RRP and renter will be required to undertake their respective safety-related activities and, where relevant, ensure the activity is carried out by a suitably qualified person.

Reform 52. RRPs will be required to comply with prescribed requirements recording and producing gas and electrical safety checks conducted at the property.

Reform 53. Renters and rooming house residents will be required to not remove, deactivate or interfere with the operation of a prescribed safety device, unless it is reasonable in the circumstances to do so (for example, if the reason for removal was to repair or replace it). Examples of prescribed safety devices could include smoke alarms and pool fences.

Urgent and Non Urgent Repairs

Reform 54. The existing definition of urgent repairs will be expanded to include breakdown of a cooling appliance, non-compliance with minimum standards or the safety-related obligations (such as a functioning smoke alarm), pest infestation and mould caused by the building structure. This reform also applies to urgent repairs in rooming houses and caravans.

Reform 55. The limit for renters to authorise urgent repairs when their residential rental provider (RRP) has not promptly responded to an urgent repair request will be increased to reflect inflation from the current limit of $1,800. The revised limit will be prescribed in regulations. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 56. The Director of Consumer Affairs Victoria will issue guidelines clarifying timeframes for responding to urgent repairs. VCAT will be required to have regard to the guidelines when determining urgent repairs disputes. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 57. Renters who have paid for urgent repairs up to the prescribed amount will be able to seek reimbursement from the RRP for the reasonable costs of repair within seven days, instead of 14 days. A failure by the RRP to reimburse the renter will entitle the renter to seek a compensation order from VCAT. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 58. For non-urgent repairs, renters will be able to apply directly to VCAT if the RRP has not carried out notified repairs within 14 days. While renters will still be able to request a CAV repairs report, renters will no longer be required to obtain this report before applying to VCAT. This reform also applies to non-urgent repairs in rooming houses, caravan parks and residential parks.

Reform 59. To encourage residential rental providers to maintain their properties in good repair, renters will have increased access to the Rent Special Account. The Rent Special Account is designed to hold rent payments that have been redirected when the RRP has not undertaken any necessary repairs. Upon application by the renter, VCAT will be required to order that rent be paid into the Rent Special Account instead of to the RRP, unless the RRP can prove that they would experience financial hardship if the rent was paid into the Rent Special Account. If, despite having been ordered by VCAT to undertake repairs, the RRP still has not fulfilled their duty, the renter may now apply to have any rent held in the Rent Special Account repaid to them in full as compensation for the inconvenience of having to wait for repairs to be performed. This reform also applies to rental arrangements in rooming houses, caravan parks and residential parks, and responsibility for administering the Rent Special Account will be moved from VCAT to the RTBA.

Reform 60. The rise in apartment living means the Act must increasingly be able to address issues such as repairs that involve an owners corporation.

Currently, where a residence is part of an apartment building or another complex managed by an owners corporation, RRPs may need to obtain approval before commencing repairs. Alternatively, a repair may have been caused by factors relating to the common property, such that the RRP would need to obtain redress from the owners corporation. This can often force the renter to endure delays, particularly if there is a dysfunctional owners corporation.

The Act will be amended to provide that, where it is alleged that a repair involves a problem or defect originating in any common property, the RRP may join any relevant owners corporation as a party to the proceeding.

Liability for Services

Reform 61. The list of fees and charges payable by the residential rental provider (RRP) will be updated to reflect contemporary practice across the full range of essential services. While the RRP’s responsibilities will remain largely the same, additional charges prescribed in regulations will include pump out charges for septic tanks, in recognition that not all properties are connected to mains sewerage disposal systems. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 62. A new provision will provide that where a renter has received an excessive utility usage bill attributable to a hidden fault (such as a leaking water pipe), the renter or the RRP can apply to VCAT to determine liability for the excessive usage charges. This reform also applies to rental arrangements in rooming houses, caravan parks and residential parks.

Reform 63. Registered community housing operators will be able to impose a service charge for any water, central heating, laundry or utility services or facilities made available to the renter. At present, this is only available to the Director of Housing. Service charges will be contestable if a renter believes they have been overcharged. Changes to the cost of providing the services or facilities must be disclosed to ensure renters are properly informed of the method of calculating the change. This reform also applies to rooming houses.

Rights of Entry

Reform 64. RRPs will be required to give renters more notice before entering the property to conduct a general inspection or a valuation (increased from 24 hours’ notice to seven days’ notice, for these reasons for entry).

Reform 65. RRPs will be liable for any loss caused to renters while a RRP is exercising a right of entry in the property. This includes any loss by theft that may occur during an inspection. This reform also applies to rights of entry in rooming houses, caravan parks and residential parks.

Reform 66. In order to enter the property to take advertising photos or videos, a RRP will be required to give seven days’ notice to enter the property, making a reasonable attempt to arrange a time that suits the renter. Renters will be able to prevent the taking of photos or videos, or the use of photos or videos, in certain circumstances.

Reform 67. If a property is being sold during a tenancy the RRP will have the right to conduct sales inspections (including open inspections) up to twice a week, at times reasonably negotiated with the renter at least 14 days in advance. The renter will be entitled to prescribed compensation for each sales inspection. If the renter is a protected person under family violence or personal safety legislation, the renter can require that any inspections be by appointment only, rather than open.

Reform 68. In order to show the property to prospective renters, a RRP will need to give 48 hours’ (instead of the current 24 hours’) notice of entry to the renter. Unless otherwise agreed with the renter, the RRP can hold up to two inspections for prospective renters per week, within 21 days of the end of the tenancy. If the renter is a protected person under family violence or personal safety legislation, the renter can require that any inspections be by appointment only, rather than open.

Terminations and Security of Tenure

Reform 69. The ‘no specified reason’ notice to vacate for periodic residential rental agreements will be abolished. This is because residential rental providers’ (RRP) ability to terminate a tenancy for reasons other than those prescribed by the Residential Tenancies Act does not adequately protect renters against unfair termination of their tenancies, where they can be asked to leave without a reason. This has a significant chilling effect on renters’ behaviour – it can lead to an unwillingness to request repairs, for example, ultimately leading to run down properties and diminished enjoyment of their home. This reform aims to improve the balance of bargaining power between the parties, and to encourage RRPs to be more transparent about their reasons for wishing to end a tenancy. This reform also applies to periodic residency rights in rooming houses and caravan parks, and periodic site agreements in residential parks.

Reform 70. RRPs will be able to issue an ‘end of fixed term’ notice to vacate at the end of the first fixed term of a residential rental agreement, but not for any subsequent fixed terms. Renters will now be able to issue a 14-day notice of intention to vacate before the end of the first fixed term, in response to receiving an end of fixed term notice. This reform reflects the view that the first rental agreement is often a trial period for both the renter and RRP. It may be, by the end of the first term that the RRP does not wish to continue the relationship because they would like to rent the property to a new occupant. For subsequent fixed terms however, the ability to terminate using this notice will be removed, so that the RRP will only be able to terminate for a reason prescribed by the Residential Tenancies Act.

Reform 71. A notice to vacate for the end of a fixed term agreement will be able to specify a date on or after the end of the fixed term. This will allow greater flexibility for RRPs and renters, by allowing the parties to agree to the renter staying slightly longer than the end of the fixed term, if this is needed. This reform also applies to these types of notices to vacate in rooming houses and caravan parks.

Reform 72. Renters will be able to give 14 days’ notice of intention to vacate, without paying lease break fees, in limited circumstances:

• where the RRP has given the renter a notice to vacate
• where the renter needs special or personal care
• where the renter has been offered and accepted accommodation in social housing
• where the renter needs temporary crisis accommodation
• where the RRP has given the renter a notice of intention to sell the property and conduct sales inspections (if the renter was not already told of the proposed sale before moving in).

Reform 73. To guard against the misuse of notices to vacate, RRPs will be required to attach evidence of a change of use to a notice to vacate for change of use. Examples of required evidence could include a building permit, or a statutory declaration from the family member moving in to the rented premises. This reform also applies to change of use notices to vacate for rooming houses, caravan parks and residential parks.

Reform 74. Currently, renters may be given notice to vacate if they or their visitor endanger the safety of the RRP or agent, or their contractor or employee. The Director of Consumer Affairs Victoria will issue guidelines for interpreting ‘endanger’, which must be taken into account by VCAT when a possession order is sought following a notice to vacate being given for this reason. This reform also applies to rooming houses, caravan parks and residential parks.

Reform 75. This reform clarifies that the meaning of ‘malicious damage’ which is currently in the Residential Tenancies Act covers intentional or reckless serious damage. This reform applies for all tenure types.

Reform 76. A RRP will be able to issue a 14-day notice to vacate if the renter or other person jointly occupying the property has seriously threatened or intimidated the RRP or agent, or their contractor or employee. This reform also applies to residents of rooming houses and caravan parks, and site tenants in residential parks. This is a new termination ground which, in combination with other protections targeting violence and dangerous conduct, is designed to help RRPs and other providers of property to respond effectively to a broad spectrum of unacceptable conduct.

Reform 77. A RRP may issue a notice to vacate when any rent owed is unpaid 14 days or more after it has fallen due. This amendment will address a practice within VCAT of disallowing a notice to vacate where the renter has paid some, but not all of their rent, 14 days after it was due. In practice, this interpretation of arrears results in periods of arrears that are longer than 14 days, and reduces RRP certainty about when they may be able to serve a valid notice to vacate.

The reform will also allow increased discretion to VCAT to give a renter, in appropriate circumstances, an opportunity to catch up on outstanding rent arrears and remain in the rented premises.

Within any 12 month period, on each of the first, second, third and fourth occasion of non-payment of rent, the residential rental provider will be able to give the renter a 14 day notice to vacate. On the first four occasions, if the renter pays the outstanding amount of rent before the expiry of the 14 days, the notice to vacate becomes invalid.

If the renter does not pay the outstanding rent within the 14 day notice period, the residential rental provider can apply to VCAT for a possession order. In determining whether to grant a possession order, VCAT will be able to assess whether to place the renter on a payment plan to meet the outstanding arrears. If a payment plan is not a feasible option for the renter, VCAT will issue a possession order. However, if the renter is placed on a payment plan and complies with the plan by paying off the arrears, VCAT must dismiss the application for the possession order. If the renter does not comply with the payment plan, VCAT can issue a possession order.

If a renter has received four notices in any 12 month period, they will accrue ‘3 strikes’ against their name. If no more notices are received during that period, the strikes will be cleared. However, if the renter fails to pay rent as required on a fifth occasion in the same 12 month period, the residential rental provider may apply to VCAT for a possession order and VCAT can choose to issue the order whether or not the renter pays the outstanding arrears within the 14 day notice period. VCAT must consider whether eviction would be reasonable and proportionate, taking into account a variety of factors, including the frequency of non-payment.

As the proposed model will not provide a termination avenue to RRPs experiencing rent arrears up to 13 days after the due date, an additional amendment to existing compensation provisions for rent arrears will enable RRPs to seek compensation for any amount of unpaid rent and other consequential losses after the payment is at least 14 days late on two previous occasions.

Reform 78. VCAT will be able to refuse to grant a possession order on the basis that it would not be reasonable or proportionate to do so. This will enable VCAT to formally consider such factors as the frequency of a particular breach, whether it is trivial, whether someone else was involved, whether family violence was a contributing reason, whether the breach has been remedied to the extent possible, the effect of the conduct on other people, the respective parties’ behaviour, and any other relevant matter.

The aim of this test is to ensure that eviction is a last resort, that rental relationships are not ended unnecessarily and that other avenues for dealing with problematic behaviour are pursued in order to promote greater security of tenure. This reform applies for all tenure types.

Reform 79. VCAT will no longer have discretion to refuse to make a possession order if it considers that there will be no future reoccurrence of a breach, or that a disturbance will not be repeated. Predicting the future conduct of parties is a speculative practice which prevents the termination provisions from functioning effectively in instances of otherwise serious conduct. This reform applies for all tenure types.

Reform 80. A mortgagee in possession of rented premises or a rooming house will be required to give 60 days’ notice to vacate during a periodic or fixed term agreement. This increase (from 28 days’ notice to vacate) will align more closely with other notice periods given for change of use.

Reform 81. If a mortgagee has expressly or impliedly consented to the mortgagor entering into a residential rental agreement in relation to the mortgaged premises, the mortgagee upon taking possession of the rented premises will be subject to all the provisions of the Residential Tenancies Act as though it were the RRP, including honouring any fixed term of the residential rental agreement.

Reform 82. If a mortgagee applies to VCAT for possession of a rented property, the mortgagee will need to evidence their entitlement to possession and to exercise a power of sale with the relevant court order. This reform also applies to mortgagee repossession to rooming houses, caravan parks and residential parks.

Reform 83. Current provisions for a 28 day notice period following the death of a sole renter can result in a property being left vacant unnecessarily and can create unnecessary delays in the creation of a new tenancy for other occupants. The provision for termination after the death of a sole renter will be streamlined and modernised. In these circumstances, either the RRP or the legal personal representative or next of kin of the deceased renter will be able to give a notice to vacate or notice of intention to vacate to the other party, and VCAT will also be able to make orders terminating the agreement.

After a Residential Rental Agreement

Reform 84. There will be greater clarity about how a RRP should be compensated when a renter breaks a fixed term lease. This will include:

• requiring advertising costs and re-letting fees to be calculated on a pro rata basis
• requiring the pro rata loss to be a percentage of what the RRP actually paid (not what the RRP may now be asked to pay the agent) for securing the renter who is breaking the rental agreement
• preventing RRPs from claiming for loss of rent where the RRP had served a notice to vacate
• requiring a RRP claiming for loss of rent to mitigate loss by placing the premises back on the rental market promptly and not unreasonably rejecting proposed new renters.

This reform also applies to fixed term site agreements in residential parks.

Reform 85. When making a compensation order in the case of a lease break of a residential rental agreement or Part 4A site agreement, VCAT will be required to have regard to the severe hardship the renter or site tenant would have suffered due to an unforeseen change in circumstances, if the agreement had continued. Previously, severe hardship could only be taken into account by VCAT if the residential rental agreement had not yet ended. This reform aims to improve equitable outcomes for vulnerable renters and site tenants by ensuring that all parties suffering severe hardship due to unforeseen circumstances can have that hardship taken into account, even after the agreement has been terminated.

Reform 86. The process for storing and disposing of goods left behind by a renter at the end of a residential rental agreement will be simplified, streamlined and modernised.

• All goods of monetary value must be stored by the RRP for 14 days, during which time the renter can reclaim them.
• If the volume of goods left behind prevents the RRP from reletting the property, the RRP can require the renter to pay an occupation fee (equivalent to the rent) for each day the goods are stored, in order to reclaim the goods.
• The renter can apply to VCAT to extend the 14 day storage period if necessary, and the RRP can apply to VCAT to charge a higher occupation fee if necessary.
• When the storage period ends, the goods can then be sold or disposed of by the RRP, and the renter can reclaim any proceeds of sale minus the RRP’s costs.

This reform also applies to goods left behind in rooming houses, caravan parks and residential parks.

Reform 87. A RRP or database operator must give a copy of personal information about a person listed in a residential tenancy database to that person if requested in writing, and may charge a fee to provide the information. Amendments will allow renters to access one free copy of their residential tenancy database listing per year. This reform also applies to residents of rooming houses and caravan parks, and site tenants in residential parks.

Reform 88. A renter will be able to apply to VCAT to have a listing on a residential tenancy database amended or removed if VCAT is satisfied that the listing is unjust in the circumstances, with regard to the reason for the listing, the renter’s involvement, and any adverse consequences. This reform also applies to residents in rooming houses, caravan parks and residential parks.

Reform 89. VCAT can order the RTBA to provide a renter’s address for the purposes of serving a document on the renter. This reform also applies to residents of rooming houses and caravan parks, and site tenants in residential parks

Family Violence and Personal Violence

Reform 90. A person who has applied for a family violence intervention order, family violence safety notice, non-local DVO or personal safety intervention order can access family violence protections in the Residential Tenancies Act. VCAT, in considering an application under any family violence related provision, may take into account:

• whether an application for an intervention order has been made
• if an application was made, whether an order was granted and/or is still in place
• if an order was granted, whether an exclusion condition exists, and
• anything else VCAT considers relevant.

Reform 91. Under this reform, family violence related applications must be heard by VCAT within a specified time.

Reform 92. Family violence related protections under the Residential Tenancies Act can be accessed by a parent or guardian of a child who is a victim of family violence, where the parent or guardian lives in the same rented premises as the child. This will ensure that where family violence has occurred against a minor, family violence related protections under residential rental legislation are available. For example, a parent or guardian of a child who is a victim of family violence will be able to make reasonable security-related modifications to rented premises, even though the child is not a party to the residential rental agreement.

Reform 93. VCAT will be able to adjudicate terminations of residential rental agreements in situations of family violence. It can terminate an agreement or require creation of a new agreement that does not include the person who committed the violence.

Under this reform, the Residential Tenancies Act will include provisions that:

• enable a renter who has been subjected to family violence to challenge the validity of a notice to vacate issued on a range of grounds including danger, threats and intimidation, failure to comply with VCAT order, successive breaches of duty, use of premises for an illegal purpose, where the offending conduct was caused or committed by the person who subjected the renter to family or personal violence
• enable a victim of family violence who is a co-renter to apply to VCAT for an order to terminate a fixed term or periodic tenancy, without requiring consent from the other co-renters
• require VCAT to consider the relative impacts and hardship of each party to the residential rental agreement, prior to making an order
• enable VCAT to make an order requiring the RRP or agent to ensure that the victim of family violence has access to the rented premises to remove their belongings, where this is necessary
• enable VCAT to apportion liability between the relevant parties in relation to bond, utility charges, other liabilities such as damage, and compensation for early termination of the rental agreement (if relevant). VCAT would be able to determine that the person who committed family violence was fully liable
• enable VCAT to specify a termination date that must not exceed a certain period of time from the making of the order (for example, two weeks)
• enable VCAT to make an order preventing a RRP, agent and database operator from making a negative listing on a tenancy database against the renter who had been subjected to family violence.

To address the impact on co-renters and RRPs, VCAT, when making an order to terminate the residential rental agreement, may also make an order to:

• terminate the residential rental agreement, or
• terminate the existing agreement and create a new agreement with one or more of the remaining co-renters (with the same terms and conditions as the original agreement).

Reform 94. Agents and RRPs will be prohibited from making unfair tenancy database listings for victims of family violence when the listing is a result of the perpetrator’s actions. VCAT will be able to order the removal of an unfair listing and to oversee the removal of unfair or unsafe details from a listing.

Reform 95. VCAT will be able to make an order that the RRP, agent or database operator must remove an existing listing or not make a listing on a residential tenancy database in relation to a victim of family violence, where it is satisfied that the breach of the residential rental agreement resulted from the actions of another person who committed family violence.

Reform 96. VCAT will be able to make an order that a database operator must remove or edit information from an existing listing in relation to a victim of family violence, where it is satisfied that not removing or editing the information would put the victim’s safety at risk (for example, current contact details). Information about the nature of the breach that resulted in the listing would not be able to be removed or edited.

Reform 97. This reform enables a notice to vacate to be challenged on the grounds that the relevant action or conduct was committed by a perpetrator of family violence. The renter must apply to VCAT challenging the validity of the notice to vacate on or before the hearing of an application for a possession order.

Reform 98. In situations where a victim of family violence and the perpetrator are co-renters, VCAT will be able, when making a compensation order or determining payment out of a bond, to:

• consider whether another party to the agreement is a victim of family violence
• apportion liability between co-renters, including determining that the perpetrator of family violence be fully liable for the RRP’s loss or damage
• exclude the victim’s share of the bond from being made available for compensation, if the victim’s name is registered against the bond.

Reform 99. When considering an application for a compensation order or determining payment out of a bond, VCAT will be able to determine that a renter who is a victim of family violence is not liable for any loss, debt or damage. In making such a determination, VCAT would need to be satisfied that:

• the loss or damage resulted from the actions of another person who has committed an act of family violence, and
• an order (interim or final) with an exclusion condition had been made against the perpetrator of family violence.

Reform 100. A consequential amendment to the VCAT Act will enable renters subjected to family violence to nominate VCAT to serve documents on the perpetrator of family violence in tenancy matters.

Serious Violence and Managed Premises

Reform 101. There will be stronger protections for RRPs and operators of managed premises in cases of serious violence on managed premises. A notice to leave will now be able to be served on a resident for their visitor’s behaviour if the resident caused, encouraged or permitted the violence. Victims of family violence cannot be given a notice to leave where the visitor is the perpetrator.

Reform 102. For instances where a resident’s residency is suspended because of serious violence on managed premises, the prescribed notice given will be updated to include further practical information for a suspended resident, advising them to contact VCAT during their suspension period and shortly after the end of two business days to determine whether or not an application has been made to terminate the residency.

Reform 103. If a renter’s residential rental agreement has been suspended because of an act of serious violence on managed premises, the suspended renter will be able to make arrangements with the RRP to have an authorised representative collect any personal items that belong to the renter (such as medication) from the premises during the renter’s suspension period. This reform also applies to residents in rooming houses, caravan parks and residential parks.

Reform 104. There will be shorter adjournment periods for applications to VCAT to terminate a residential rental agreement where an act of serious violence occurs on managed premises. The hearing of the application will only be able to be adjourned once, and the adjournment must not be for longer than five days. This reform also applies to rental arrangements in rooming houses, caravan parks and residential parks.

Reform 105. If a notice to leave is served on a resident for serious violence on managed premises, and the RRP or operator seeks to terminate the residency at the end of the two-day suspension period, VCAT must do so if it determines that the notice to leave was appropriately given.

Reforms Unique to Rooming Houses

Reform 106. A future inter-governmental project will consider the definition of a rooming house in the context of the modern breadth of rooming house accommodation.

Reform 107. Under this reform, buildings owned or leased by a registered housing agency will be able to be declared rooming houses by the Minister for Housing. Currently only buildings owned or leased by the Director of Housing can be declared.

Reform 108. An owner of a building, or that owner’s agent, must notify the relevant local council if they have reason to believe the building is being used as an unregistered rooming house. This reporting obligation will be expanded to include where the building owner or their agent ought to know, in all the circumstances, that the building is being used as an unregistered rooming house. This reform will prevent owners and agents profiting from leasing a building from turning a blind eye where there is evidence it is being used as an unregistered rooming house.

Reform 109. To improve rooming house residents’ awareness of their rights and responsibilities, the Act will also be amended to explicitly require rooming house operators to give a resident a copy of the ‘Red Book’. A summary of these rights and responsibilities will also need to be displayed in each resident’s room.

Reform 110. A rooming house operator wishing to give notice to enter a resident’s room to conduct a general inspection will be required to give the resident 48 hours’ notice (rather than the current 24 hours’ notice for this reason for entry).

Reform 111. Rooming house operators will be able to charge for separately metered water consumption in the same way that they can already charge for separately metered electricity and gas consumption. Where a room is separately metered for water, this will better reflect the resident’s water use than the current practice of including water consumption in rent.

Reform 112. While not in the Bill itself, the prescribed rooming house minimum standards will be updated to clarify that:

• a resident’s room must have at least two power points that are unoccupied, working and safe
• the operator must provide laundry facilities in a ratio of one set of facilities for every 12 residents.

Reform 113. The current practice of some rooming house operators using Part 2 tenancy agreements for rooms in a rooming house will be abolished. Tenancy agreements and the provisions in Part 2 of the Act are ill-suited to the communal living aspects of a rooming house, and vulnerable rooming house residents are disadvantaged by agreements that hold them to a fixed term (liable for lease break fees) in accommodation where conditions can be chaotic and residents have no control over who occupies the other rooms or shares their room

This reform will replace the use of tenancy agreements for rooms in rooming houses with tailored fixed term rooming house agreements. If the parties choose to enter a fixed term rooming house agreement, the operator will be able to request a higher amount of bond (up to 28 days’ rent instead of the usual 14 days’ rent) and a resident will be required to give 14 days’ notice of intention to vacate (instead of the usual two days’ notice) at any time.

Reform 114. An amendment will clarify that where a building owner or lessee is entitled to terminate the lease of a building in which a rooming house is operating, the rooming house residents will be entitled to be given a notice period when a building lease terminates, whether or not the building owner or person discontinuing the lease was aware that the rooming house was being operated.

Reforms Unique to Caravans and Residential Parks

Reform 115. The definition of caravan park ‘resident’ will be amended to address the problem of holiday-makers becoming ‘accidental’ residents, by ensuring that a person who has a genuine holiday arrangement will not meet the definition of a resident, even if they occupy the site for 60 or more days. The reform will also ensure that park operators will not be able to avoid the operation of the Residential Tenancies Act by putting people genuinely residing in the park on sham ‘holiday’ agreements.

Reform 116. If a park operator is not the freehold owner of the park land, the operator will be required to make appropriate pre-contractual disclosure to prospective park residents of the nature of the operator’s interest in the land, and of the limitations on the operator’s ability to grant interests in the land to prospective park residents.

A park operator who is not the freehold owner of the land must not enter into an agreement with a resident for a fixed term that exceeds the unexpired term of the head lease to the park operator.

Reform 117. The ability of park operators to terminate a Part 4 periodic residency right or a Part 4A periodic site agreement for ‘no specified reason’ will be removed. Park operators will be able to issue a notice to vacate at the end of a specified period of occupancy under a residency right, or end of a fixed term site agreement. There will also be new notices to vacate for closure of the park.

Reform 118. If a park is to be closed, the park operator must give at least 14 days’ notice to local government before giving a notice to vacate to a park resident. Advance notice of the park closure will enable the council to plan early service responses for affected residents.

Reform 119. In the event of a park closure, the park operator will have to pay compensation to site tenants and residents who own fixed dwellings in the park. The park operator will be required to apply to VCAT for a determination of compensation within 30 days of giving notices to vacate. The amount of compensation payable will cover reasonable relocation costs if the resident’s dwelling is being relocated, or compensation for loss of residency if the dwelling is not being relocated.

A park operator will not be liable to pay compensation for park closure if they do not own the land on which the caravan park or Part 4A park is located, and the closure of the park is due to the expiry of a head lease over that land.

Reform 120. Park operators who charge an exit fee will be required to provide prospective site tenants with additional information about the exit fees to help prospective site tenants better understand their future liability. The additional details that must be disclosed will be prescribed in regulations, and will be similar to the enhanced disclosure requirements that exist for exit fees in retirement villages.

Reform 121. A Part 4A site agreement will be able to specify that rent increases will be either by a fixed amount according to a specified method of calculation, or by a non-fixed amount. If a fixed amount is used, a reminder notice will be sent to site tenants ahead of an increase, which cannot be subject to rent review by Consumer Affairs Victoria. Non-fixed rent increases will still be subject to rent review.

Reform 122. A site tenant will be able to use their site for non-residential purposes (such as running a home business), provided they obtain the park operator’s written consent. The park operator must not unreasonably withhold consent, but may specify reasonable conditions relating to the non-residential use of the site.

Reform 123. A fairer and more efficient system will be introduced for providing keys or devices enabling vehicular access to the park to park residents. An initial key/device must be provided free of charge, but the park operator can charge for any additional or replacement keys or devices, and the park resident must return all keys and devices at the end of their residency.

Reform 124. Where a breakdown of communal facilities in a park has been reported to the operator, the operator must ensure the breakdown is repaired as soon as is reasonably practicable.

Reform 125. Urgent and non-urgent repairs processes will be introduced for Part 4A sites, modelled on the repairs processes that exist for other rented premises under the Act. The park operator will be responsible for urgent and non-urgent repairs to the site, including any structures and fixtures on the site owned by the park operator.

Reform 126. The urgent and non-urgent repairs processes that exist in the Residential Tenancies Act for Part 4 caravans will be extended to cover Part 4 caravan sites. The park operator will be responsible for urgent and non-urgent repairs to the site, including any structures and fixtures on the site owned by the park operator.

Reform 127. Park residents who own their dwelling will owe a duty to maintain (subject to fair wear and tear) their dwelling in good repair, and ensure it is safe to live in and does not pose a significant health risk.

Reform 128. Park operators will be prohibited from making park rules that require park residents to undertake significant works on a dwelling other than for reasons of reasonable cleanliness, safety or good repair.

Reform 129. If a dwelling owned by a park resident is being sold on-site and the dwelling is not in a reasonable state of cleanliness or repair, or poses a significant health or safety risk, the operator may require an undertaking that the defect will be rectified within a reasonable timeframe, as a condition of consenting to the transfer of the residency right (or assignment of the site agreement).

Reform 130. A park operator who enters into an agreement to sell a Part 4A dwelling on behalf of a site tenant must not charge a commission for the sale unless the services provided by the operator as the selling agent are the effective cause of the sale, and the purchaser is not the operator or a related party.

Reform 131. Caravan park residents will be able to form and participate in Part 4 residents’ committees, equivalent to the Part 4A site tenants’ committees that site tenants can participate in. In the case of a ‘hybrid’ park containing both Part 4 residents and Part 4A site tenants, only one committee may be formed in respect of the park, and may comprise both residents and site tenants.

Reform 132. An operator will be required to give consult with caravan park residents on any proposed change to the park rules, in the same way that operators are already required to consult with Part 4A site tenants.

Reform 133. A park operator will be required to consult with the residents’ committee (if a committee has been formed in the park) on any proposed change to the park rules, or any proposal to introduce, remove or substantially restrict a facility or service in the park.

Reform 134. Site tenants will be able to request from the park operator that a person residing with them in their dwelling be added to the site agreement and recognised as a site tenant. This reform will protect co-habitants of site tenants (such as partners or relatives) by ensuring they can continue to live in the home in the event of the original site tenant’s death. Park operators must not unreasonably refuse the original site tenant’s request.

Technical Amendments

The Bill also includes a number of minor or technical amendments:

Reform 135. Amendments to the provisions dealing with liability for utility usage charges for non-compliant replacement appliances, to make them more adaptable to any future introduction of energy efficiency standards.

Reform 136. Amendments providing for the suppression of certain crisis accommodation from the public Rooming House Register, particularly where there is a threat of interpersonal or family violence.

Reform 137. Amendments clarifying the definition of ‘temporary crisis accommodation’, to accommodate fluctuations in the average time clients remain in such accommodation.

Reform 138. Amendments clarifying the definitions of ‘health or residential service’ and ‘service agency’, to reflect contemporary settings for service delivery.

Reform 139. VCAT will be able to postpone the issue of a warrant of possession in relation to residency in a rooming house or a caravan park in certain cases, based on relative hardship grounds and provided there is no unpaid rent or other breach.