New rental laws now apply in Victoria.
The Residential Tenancies Act 1997 for Victoria changed on 29 March 2021 and now a year has passed, it’s hard to make excuses for failing to align with them.
The new rules include clauses banning rent bidding, addressing the way a tenancy is ended, and clarifying the basic minimum standards for renters who move into new properties. There have been dozens of changes in total and it can be tricky to stay across them. However, following all the rules is important if you want your clients and your agency to avoid penalties.
How to avoid non-compliance
When it comes to the new legislation, taking an ad-hoc approach is a risk. To ensure every box is ticked, you need to be systematic and have clear procedures for all stakeholders to follow.
Hiring a compliance officer is one way to ease the pressure on your property management team. Instead of leaving everyone to deal with the changes and remember every rule themselves, you can assign responsibility to one person. This individual can check all properties are up to date and create communication checklists and templates for everyone to use.
You don’t necessarily have to hire someone full time. A part-time contractor may work in this situation, or you could consider outsourcing to a business which specialises in this area. Generally, you should only need one day per week for someone to oversee 100 properties under management. Knowing this will help you calculate the amount of support you need.
Stay in touch with property owners
Tenants are now called renters and landlords are now known as rental property providers (RPPs) or rental providers.
According to Consumer Affairs in Victoria, in 2021, a rental non-compliance register was set up to list rental providers and agents who have not met certain obligations under the Residential Tenancies Act 1997 or who have broken the law. This includes rental providers who have been ordered by VCAT to remedy a breach or pay compensation. The register may include rooming house operators, caravan park owners, caravan owners and site owners, and real estate agents.
While it is in renters’ best interests to be aware of their rights, your RPP clients may have little knowledge of what has changed. This puts them at risk of being fined or added to a non-compliance register, which has the potential to force the sale of their property.
Your compliance officer can work on raising awareness and communicating with these clients about their updated responsibilities so they avoid a worst case scenario.
Emails, letters in the mail and even webinars (live or prerecorded) can be ways to ensure RRPs are kept informed. These can be sent to existing clients and incorporated into the onboarding process for new ones.
Keeping all bases covered will place pressure surrounding non-compliance on your clients rather than your agency. You need to be able to prove you have taken every necessary step to ensure compliance so you don’t wind up in breach of legislation and potentially ‘blacklisted’.
The benefits of compliance
It makes sense to hold regular education sessions about compliance for your team so they have a degree of confidence about what has changed.
Eventually, following the rules will become standard practice and they will be easier to follow. The advantage of being proactive is your team will sound more confident and organised when meeting with new and existing clients. It is an excellent way to build your reputation as a quality provider.
As well as boosting goodwill, the benefit of ensuring your property management business is fully compliant with new renter legislation is being able to increase the value of your rent roll. If you’re looking to sell, a buyer is likely to want to know you have control in this area. Share proof of compliance and clear systems for keeping things this way and you’ll be able to arrange a faster, smoother and more profitable sale when the time comes.