The changes to family and domestic violence laws are a welcomed change for Australians who believe in a strong and resilient justice system.
While the amendments are designed to better respond to those suffering abuse, they also affect landlords and property professionals who own and manage rental properties.
Previously, rental laws have restricted tenants affected by family and domestic violence wanting to end a tenancy agreement.
Under traditional laws, if a lease is terminated early, all tenants are held equally responsible for break-of-lease expenses and any damage caused at the property.
A victim is also not able to immediately terminate their lease and must apply to a tribunal or court for an order.
Harsh penalties, including black-listing on tenancy databases and loss of bond, usually follow failure to fulfil contractual obligations or if correct processes are not followed.
This leaves the person experiencing violence in a vulnerable position if they need to flee and seek new accommodation.
These inflexible laws weren’t working for the people who needed them to work the most.
Now states and territories are responding with new and improved laws that alleviate the legal and financial barriers of leaving an abusive household.
Most recently, New South Wales and Western Australia made significant legislative changes (with other states and territories taking strides in the same direction).
Here’s what property professionals need to know about the new rental laws:
THE LAWS
Under the rental reforms, survivors of domestic violence have added protections. Immediately breaking the lease is now permitted in some states without incurring a penalty and, in some jurisdictions, the tenant cannot be held responsible for damage to the property a violent partner causes.
THE IMPACT
These are necessary protections for those caught in domestic violence situations, allowing them to escape without the added burden of financial penalties or repercussions. However, these situations flow on to the landlord – who could find themselves out-of-pocket due to broken leases or damage.
THE PROTECTION
In these situations, landlords will look to their insurance to cover the loss (rental losses and potentially malicious damage repairs). This means agents and property managers need to make sure there is adequate protection in place so they can make a successful claim.
Agents also need to be aware of the provisions within the laws so they can provide accurate information to their landlords and tenants. Knowing the rules is part of the agent’s duty of care to both landlord and tenant. A negligence claim could be lodged if they fail to provide that care or give incorrect information.
THE BENEFITS
The new laws allow property professionals to offer support and compassion in times of crisis. They mean survivors of family and domestic violence now have a legal way to leave a tenancy, which may reduce the number of tenants abandoning properties and leaving behind belongings that landlords have to dispose of.
Also, in some states and territories, there is an option for either party to stay in the property, which aims to prevent vacancies.
THE CHALLENGES
In the situation where one of the cotenants is remaining on the lease, they are still required to pay the full weekly rent and the difference of bond. A challenge arising from this is the argument the existing tenant is only responsible for half the rent and half the bond. If this is the case and they refuse to top up the bond, you would treat this like any other breach of the tenancy act.
NEXT STEPS
Agents, property professionals, landlords and tenants must comply with the new legislation. The laws differ from state to state and agents should make sure they are informed about the changes and are armed with the tools and knowledge to properly respond in times of crisis.
It is also suggested property professionals contact their landlord insurance provider to check the property is covered for incidents relating to family and domestic violence, including rent default and damage from malicious act
STAYING ON TOP OF LEGISLATION
Melbourne’s go-to property management expert Sam Nokes says legislative changes are one of the biggest challenges facing property professionals.
“We work in an industry that’s constantly evolving, so it is imperative agents keep on top of changes to ensure they’re not only complying with all relevant laws and obligations, but better informing their clients about matters affecting the real estate sector,” he says.
A big change to impact the industry was the amendments to Victoria’s underquoting laws in 2017, designed to prevent false and misleading representations about the price of the property for sale.
Mr Nokes says changes to underquoting laws significantly impacted how industry professionals operate and communicate with consumers.
“The amendments to underquoting laws meant extra steps were added to ensure agents were giving the best advice,” he says.
“While this is a challenge, changes in legislation are made to benefit the industry and simplify processes.
“This is the case for amendments to domestic violence laws.
“It is not only an important piece of legislation allowing people to be safe, but it also offers a clear set of instructions for property professionals on what to do if a client finds themselves in a situation involving abuse.”
Having worked in the property industry for more than a decade, Mr Nokes is well versed in adapting to change.
Here are his top tips for staying on top of legislative changes:
1. Read, read, read – but don’t just read from popular newspapers.
2. Align with a specialist insurer that works in the property industry. General insurers don’t have the resources to stay on top of legislative changes, however specialist insurers like EBM RentCover are involved at an industry level and their policy stays upto-date.
3. Sign up for Google Alerts. Google Alerts is a go-to tool for people who want to stay on top of an important issue, without shelling out big money (Mr Nokes’s top alerts include Residential Tenancies Vic and Law Real Estate Victoria.)
4. Check the parliament Hansard for information outlining upcoming changes in legislation. Also, the explanatory memorandum that comes out when legislation changes offers great insight into reforms.
5. Don’t just understand what the change is, but understand why there is a change. If you understand the why, and the problem that is trying to be solved, then you have greater empathy and knowledge of the issue.
