$11,000 Fines in Store for Landlords Who ‘Do the Wrong Thing’ in Victoria

A billboard advertises a home for sale in Melbourne on September 6, 2022 as Australia's Reserve Bank lifted interest rates to 2.35 per cent, the highest levels seen since December 2014, in an attempt to cool the country's overheated economy. (Photo by William WEST / AFP) Photo by WILLIAM WEST/AFP via Getty Images

The Victorian Labor government will establish a new taskforce that could fine landlords who “do the wrong thing.”

However, the Opposition is seeking questions in Parliament on whether this taskforce will apply to government landlords of state-owned housing.

Under the government’s reforms, a landlord who lets a new renter move into a rental property that doesn’t meet certain standards could receive an $11,000 (US$7,300) fine.

The taskforce, embedded in Consumer Affairs Victoria, is backed by a $4 million investment and will employ more intelligence analysts, inspectors, investigators and lawyers within the government agency.

Consumer Affairs Minister Gabrielle Williams explained the taskforce sent a clear message to rental providers that rental offences would “not be tolerated.”

The taskforce will crack down on offences including false advertising, failure to lodge bonds, and renting out properties that don’t meet minimum standards.

These minimum standards include attributes that people would “reasonably expect in a home.”

This could range from a functional kitchen to lockable external doors and being waterproof and structurally sound.

“Most rental providers and estate agents do the right thing—today’s announcement is about sending a clear message to those trying to get away with rental offences,” Ms. Williams said.

Consumers Affairs Victoria said they will also encourage the public to report on unlawful conduct to its intelligence team and upload evidence.

Companies could face $57,000 if they do not meet these rental minimal standards.

Opposition Raises Concerns With Taskforce and Taxes

Shadow Minister for Home Ownership and Housing Affordability Evan Mulholland questioned whether the taskforce will apply to the Victorian government.

“The Minister for Housing in question time could not answer whether this taskforce applies to Victoria’s largest landlord, the government. Especially since yesterday’s ombudsman report shows a 83 percent increase in complaints about public housing,” he posted on X.

Victorian Premier Jacinta Allan posted a photo on X showing cracked doors on walls and floors and leaky taps to explain the reasoning behind the establishment of the new taskforce on March 18.

Ms. Allan said there were still “too many agents” and “rental providers” who continued to lease out dodgy rentals.

“It’s why we’re establishing a dedicated new taskforce focused on finding those who do the wrong thing. Letting a renter move into a property that doesn’t meet these standards is a criminal offence,” she said.

“We'll make sure it’s treated as such.”

The government said it was also delivering rental stress support for tenants and establishing Rental Dispute Resolution Victoria.

Building on Rental Reforms in 2021: Government

The labor government introduced more than 100 rental reforms in 2021, which they claimed made renting in Victoria fairer and safer.

This followed a consultation that closed in 2019, involving more than 700 submissions from the Victorian community.

These included a ban on rental bidding, new rental minimum standards, no eviction without a reason and new rules on urgent repairs.

“The renting taskforce builds on the work being done through the Labor Government’s housing statement, including banning all types of rental bidding, restricting rent increases between successive fixed-term rental agreements, and extending the notice of rent increase and notice to vacate periods to 90 days,” the government said.

Ms. Williams added that, “It’s been almost three years since our landmark package of over 130 rental reforms took effect, and today we are making the rental market fairer for everyone by establishing the renting taskforce.”

Victorian Property Taxes

It comes after Victorians were hit with new taxes for owning a second home or an investment property on Jan. 1, 2024.

Properties with a land value between $50,000 and $100,000 are taxed a flat $500 yearly rate. This rises to $975 for homes between $100,000 and $300,000, plus an extra 0.1 percent of land value for homes over $300,000.

Shadow Housing Minister Richard Riordan recently drew attention to the impact of property taxes in Victoria on renters.

“Land tax equals rental tax. Out of control taxes levied on rental properties this year are seeing people already struggling to find a rental place to call home paying up to $200 per week to the state government,” Mr. Riordan said.

“New unprecedented tax rates are hurting people and families who can least afford it. A government simply cannot tax itself out of financial trouble.”

On March 18, Mr. Mulholland also raised concerns about data showing an 0.8 percent drop in rental bonds in Victoria.

“The decrease marks the first annual decline since records began in 1999, with an average 3.2 per cent increase being recorded over the past decade,” Mr. Mulholland said.

“While Labor’s promise to build 80,000 homes a year for the next 10 years falls further out of reach, the rental shortage is exacerbated with Labor’s increases to land tax and failure to tackle other punitive taxes on property such as stamp duty.”