The changes to the residential tenancy obligations in Victoria are posing a challenge to mum-and-dad investors who may now face a substantial increase in the costs of their property investments, according to the Real Estate Institute of Victoria.
The new set of rules lays out more than 120 changes to landlord obligations that will come into effect on 29 March 2021.
Gil King, CEO of REIV, said the changes will increase ownership costs and make maintenance and management of property more complex. These could become deterrent for investment.
"New costs introduced through these changes are likely to result in higher rents and could see mum-and-dad investors exit this asset class, putting further pressure on rental availability and affordability for Victorians," he said.
One of the new responsibilities given to landlords is ensuring the availability all basic amenities, such as hot and cold water in the bathroom and laundry, functioning ovens, stovetops and sinks in the kitchen, a permanent and working heater in the living room.
Under the new rules, tenants will have more freedom to make simple modifications to the rental property. They will not need permission to install picture hooks, attach child safety devices, replace curtains, and use energy-efficient lighting.
The new rules, according to the state government, is a "step towards making renting fairer for all Victorians."
"These are the biggest reforms to renting in Victoria – setting out the minimum standards that must be provided in all rental properties, to better protect vulnerable tenants and turn rental properties from a house into a real home," said Melissa Horne, minister for consumer affairs, gaming, and liquor regulation.
King said with the changes coming into effect soon, players in the sector need to be able to be educated.
"That said, the changes are a now reality that the sector needs to face and the REIV stands ready to help property owners, managers and stakeholders adjust accordingly," he said.
REIV will be providing its members with tools and resources and on-and-offline information sessions and courses to guide them with the changes.
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