Victoria Rental Reforms: What Landlords and Investors Need to Know

Major changes are coming with Victoria rental reforms! Discover what landlords & investors need to know before new rules take effect in 2025.Victoria’s rental laws are undergoing significant changes, with new regulations set to take effect in November 2025. These reforms, aimed at improving tenant protections and promoting fairness in the housing market, will affect how landlords and property investors manage their rentals. 

If you own an investment property, understanding these updates is essential to ensuring compliance and maintaining a profitable portfolio.

Key Changes Under the Victoria Rental Reforms

1. Ban on No-Fault Evictions

Landlords will no longer be able to evict tenants without a valid reason. This move aims to provide renters with greater housing stability and prevent abrupt lease terminations.

2. Prohibition of Rental Bidding

All types of rental bidding will be banned. This means tenants will no longer be able to offer higher rents to secure a property, ensuring a fairer leasing process for all applicants.

3. Extended Notice Periods

The notice period for rent increases and terminations will be extended from 60 days to 90 days, giving tenants more time to secure alternative housing if needed.

4. Standardised Application Process

A new state-wide rental application form will be introduced, simplifying the leasing process for tenants and real estate agents. Landlords and agents must also comply with strict privacy guidelines regarding applicant data.

5. Ban on Application and Payment Fees

It will become illegal for rental technology platforms to charge tenants extra fees when applying for a property or making rental payments.

6. Mandatory Property Standards

Properties must meet minimum rental standards at the time they are advertised, rather than only when tenants move in. These include functional kitchens, secure external doors, and weatherproofing.

7. Annual Safety Checks

Landlords must now conduct annual smoke alarm safety checks, adding an extra layer of security for tenants.

8. Licensing and Professional Development for Property Managers

Property managers, real estate agents, and owners’ corporation (OC) managers must now obtain a licence and undergo ongoing professional development to maintain their accreditation.

9. Increased Penalties for Non-Compliance

Penalties for real estate agents and landlords who breach these laws have increased, with fines of up to $47,422 for offences such as misleading advertising or underquoting.

How These Changes Impact Landlords and Investors

While these reforms are designed to enhance tenant protections, they also introduce new compliance obligations for property owners:

• Higher Compliance Costs: Ensuring properties meet new rental standards may require upgrades, inspections, and ongoing safety checks.
• Less Flexibility in Lease Termination: Landlords must provide a valid reason for eviction, making it harder to remove problem tenants.
• Potential Impact on Rental Yields: The ban on rental bidding could affect the rental price competition in high-demand areas.

According to Real Estate Institute of Victoria (REIV) President Kelly Ryan (as stated in an article by Sarah Petty), these measures will make renting fairer but could also create additional challenges for property investors. To quote Ryan:

“It does take away again some more control that they have over one of their biggest assets. There’s a risk here that there’s unintended consequences as a result of trying to give renters more security.” 

Industry Reactions to the Reforms

• Tenant Advocacy Groups: Organisations like Tenants Victoria support the changes, arguing that they strengthen the rights of renters, who now make up almost 30% of Victorians.
• Landlords and Property Investors: Some property owners worry that increased regulations may lead to higher costs and reduced rental stock, as some investors exit the market due to complexity and compliance burdens.

What Landlords Should Do Next

With these changes coming into effect soon, property owners must take proactive steps to constantly have the upper hand:

• Review Lease Agreements: Ensure all rental contracts comply with the new laws before November 2025. 
• Conduct Property Assessments: Check if your property meets minimum rental standards and address any deficiencies.
• Partner with a Property Manager: Work with an expert property manager who understands the Victoria rental reforms and can help you handle the compliance requirements. 
• Budget for Compliance Costs: Factor in potential expenses related to safety checks, property upgrades, and regulatory compliance.

The rental reforms in Victoria mark a significant change in the rental market, aiming to create a more balanced system between landlords and renters. While these changes provide tenants with more security, landlords must be diligent in adapting their investment strategies. Being informed and working with an experienced property manager will be essential to dealing with these reforms effectively.

If you need professional assistance and tips on ensuring your rental property remains compliant, connect with us at BISE Property today!