Initially, there were many sections of the new legislation and regulations that were contradictory and very difficult to understand, however, we were able to tap into the experienced practitioners in our group to provide strategies to achieve the best outcomes for both parties. I believe we have navigated through the changes very well, and we are providing knowledgeable, experienced advice to our clients. In preparation for the changes, we provided our property managers with in-person and Zoom training throughout the lockdowns and restrictions to plug the knowledge gap left by the authorities.
While some real estate agencies have faced challenges in adapting to the shake-up, the Barry Plant Group has expanded its rent roll assets with the addition of 1300 new properties over this time. Our acquisition of existing agency rent rolls is a testament to the reputation of our network.
More than 130 rental reforms came into effect in March 2021, including gas and electrical safety checks of properties every two years plus yearly inspections of smoke alarms.
Of the 34,000 investment properties Barry Plant has under management, we found that one of the most significant impacts on rental providers was the increased costs associated with essential safety checks and upgrades to properties to meet new minimum safety requirements.
The definition of “urgent repairs” was expanded to include the breakdown of air conditioning, smoke alarms and pool fences, as well pest infestations or mould caused by the building structure.
The new regulations give renters more rights and make renting fairer and safer. Experienced property managers can help navigate the best outcome for landlords, now known as “rental providers''. And there is no doubt that with the new minimum standards and safety-related activities, rental homes in Victoria are now among the safest in the country.
Renters can now make minor modifications to their homes without permission from their rental provider under the new laws. Renters must also pay for improvements unless they are classed as repairs, or needed to meet a safety standard. They will also have to reverse any changes when they vacate, or cover the cost of doing so unless they come to an agreement with the property owner.
“No specified reason” evictions are now banned, with rental providers required to offer a valid reason, for example, if they’re selling or moving in.
Some of the new reforms were implemented before the official date, including being unable to “unreasonably refuse consent to a renter wishing to keep a pet”. Many owners were anxious about this change, but what wasn’t widely known was that with previous legislation, you could not evict a renter who has a pet without consent unless that pet was damaging the property.
A positive result of new regulations is that renters are now forthcoming with information about their pets, which means owners and property managers can be more aware and look out for issues before extensive damage occurs.
At the start of the changes, many rental providers opted to sell investment properties that would be expensive to bring up to the new standards; this exacerbated a shortage of rental properties. Many rental providers reaped rental increases when they upgraded their properties, which I believe will encourage more investors back into the market.
Navigating these legislative changes in the middle of a pandemic added a layer of difficulty to the whole exercise. Still, they are now well bedded in, and both rental providers and renters benefit from them. The rental market is flourishing, vacancy rates are low, and the outlook for property investors is very positive.