The Andrews Labor Government has updated Victoria’s rental laws, paving the way for efficiency standards that will lower energy bills and cut climate pollution. Here’s the low-down on this and other important reforms.
The new Residential Tenancies Amendment Act 2018 passed in September 2018 contains hundreds of reforms covering all aspects of tenancy law – a pretty daunting prospect to get your head around. So here’s our take on the key changes particularly as they relate to our particular interest – energy and water efficiency standards.
For more detailed information on the entire reform package, head to Consumer Affairs Victoria.
The new laws will be implemented progressively, and by default on 1 July 2020.
Although the new laws cover more than 130 reforms, Environment Victoria is specifically focused on the introduction of minimum energy and water efficiency standards for rental homes.
Rental properties are generally much less efficient than owner-occupied homes, exposing renters to high energy bills and unhealthy living conditions (in homes that are freezing in winter and dangerously hot in summer). With rental homes making up more than a third of our housing stock, energy waste due to inefficiency is also a major contributor to Victoria’s climate pollution. But there’s little incentive for property owners to invest in efficiency measures like insulation or efficient heaters because the benefits of lower bills and improved comfort go to renters. The only way to fix this problem is to require rental homes to meet basic standards for efficiency performance before they can be leased.
The new laws will ensure every rental home meets basic requirements such as:
Importantly, the new laws also create the power to set minimum standards for energy and water efficiency performance. However, the detail of what these efficiency standards will require is not yet worked out – that will be defined in regulations over the next 12-18 months.
Environment Victoria will continue to be actively engaged in this process, pushing hard to make sure they include high impact measures such as insulation, draught-sealing, low-flow shower-heads and efficient fixed heating and hot water systems.
And as we explain in our report we support standards being introduced in a staged way, giving property owners plenty of notice to comply. This will allow compliance costs to be spread over several years if necessary, avoiding pressure on rent increases. Complementary protections included in the reforms (see below) should also ensure standards do not lead to unreasonable rent increases.
For more on how it would all work, here’s a quick summary of the main myths and facts about efficiency standards.
Consumer Affairs is the best source of detailed information about the rest of the reforms. But here’s a quick summary of the main issues people have been raising with us:
Pet ownership. Renters need to seek permission from their landlord to keep a pet, and landlords have 14 days in which to apply to VCAT in order to refuse consent. If no application has been lodged within 14 days, permission is taken to have been granted. There are a number of factors VCAT can take into account in deciding whether it is reasonable to refuse consent, including the type of pet, and the character and nature of the property including appliances or fittings. It is reasonable to assume the risk a pet may pose to wildlife attracted to a native garden would be a relevant factor for VCAT to consider.
Minor modifications. Renters will have the right to make minor modifications – such as nailing a hook on the wall or installing anchors to stop furniture falling on children – without first obtaining the landlords consent. Modifications will need to be made carefully, and using a suitably qualified person in some instances. Renters will be responsible for restoring any changes made to the property.
Importantly however, renters will not be required to remove the modification where it has been funded through a scheme, for example a low-flow shower-head or draught-sealing installed through household efficiency upgrade programs. This should significantly increase renters’ access to these publicly-funded schemes.
Rent increases. Landlords will not be permitted to raise rent more than once per year, and the method for calculating the increase must be set out in advance in the rental agreement (for example, no more than X percent in a 12 month period).