Today I rise to speak on the Consumer Legislation Amendment Bill 2019, which is an omnibus bill which talks about many acts, such as the Fundraising Act 1998, the Residential Tenancies Act 1997 and the Australian Consumer Law and Fair Trading Act 2012, but I am today going to focus my contribution on the major housing issues in my area that are reflected in this change in legislation.
Several people are coming into my office each week talking about being unable to find rental properties—people with good jobs and references—because supply is short and landlords are actually avoiding the rental market because of the changes that the government has made and is making today to the residential tenancy laws.
There is quite a lot of confusion, and there is quite a lot of anxiety. This is severely impacting supply in my region. Many people have spoken to me about the fact that pets can now be put into rental properties, and whilst the bill talks about the fact that the landlord can initiate saying no, they would have to have due cause of course, which is the case that is worrying people, and it has to go to VCAT.
The landlord must not unreasonably refuse consent to keep a pet on a rental property. Clauses 40 to 46 deal with these issues. What I am trying to work out is: what is classified as ‘unreasonable’? If a landlord plans to move back into the property but has a severe allergy to cats, for example, would that refusal be considered unreasonable? ‘Unreasonable’ is actually not defined. I understand pets are important.
I have always had pets, so I absolutely understand the importance of the role pets play. However, the onus will be on the landlord to get the approval from VCAT to refuse to consent to a pet once they have received the request from the renter.
VCAT already has huge lead times. Will this move increase the load on the tribunal? What happens while the landlord is waiting for the decision to be made? Is the pet allowed in the house in the meantime? If not, what happens to the pet while waiting for a decision? Is the tenant allowed to move in? If not, what happens to the tenant? Landlords are really worried about these changes and the lack of detail about them and as such are pulling their properties off the market and looking at alternatives, such as Airbnb.
I have had personal experience with some challenges, and one of the things we have talked about is the concern we have as an opposition here that there is no definition of ‘pet’. I actually can tell you a story about a property we had on one of the farms, which was rented to some people who decided to rear calves on the front lawn.
I had renovated this house fairly recently and spent quite a lot of money on the garden. The garden beds and the lawn area were used for about 20 calves, which turned the whole yard into a floor or a ground area of mud, so the lawn was completely destroyed. When we said that was probably a bit unreasonable, that was not what the tenant thought was unreasonable. Twenty calves can just turn an area into pretty much a mud pile over winter. It compacts the soil.
It was quite a big area to have to re-renovate when we had already spent quite a lot of money on making the house attractive. I also had another situation where we had two showers in the property and the second shower was used as the kitty litter tray for the cats. That totally destroyed the plumbing for the whole house. It is about standards.
It is about being able to put some parameters around pets and behaviours, and it is actually very, very hard as a landlord to implement those standards.
This is what people are concerned about—those horror stories which you hear too many of where too much onus is on the landlord and the balance has been skewed. And to back up my statements around that I would like to talk about a recent quote from someone from my area, a real estate agent, in the local newspaper in February this year.
His comments were that: Owners are losing faith in system— with the new rule changes proposed. He went on to say: In the past it might have been too far in favour of the landlord but at the moment it’s just gone the wrong way. The pendulum’s swung too far and landlords are getting out of the market place. Mark Dwyer is the name of the real estate agent I quote, and he continued by saying that the new rental rules, which were actually brought in to provide more security for renters, were actually working in reverse and making it harder for tenants.
I just don’t see how five-year leases and being able to have dogs and make minor alterations is going to be able to help. I think it’s going to make it harder … This is coming from a real estate agent who spoke publicly on the record. He has been seeing huge numbers of applicants competing for properties, and that is not normal in our part of the world.
So the thing is, what we are seeing is Airbnb listings in Warrnambool going from 30 to 300 in six years, with a huge growth over the past two years. So the landlords are simply taking the properties off the market and looking for alternatives.
Assumptions are also, I think, that all landlords are wealthy, and that is not the case. In our part of the world many are farmers, as was our situation. You buy a property, and it sometimes has two houses on it; they just come with the land price, really. We work hard, and I think all of you understand that farmers are under enormous pressure. They are not wealthy people who have cash available. Sometimes they will even buy a property in Warrnambool as their investment to retire in later and use it in the meantime to gain some rental income.
So these are not entrepreneurs who are buying land and properties one after the other. They are just mum and dad investors. So I see very much a situation where we are really getting a skewed market and there certainly is market failure, and the government, by imposing these changes, are really not addressing that issue that we are seeing. We are seeing also a shortage of social and public housing in my region.
In fact we have a 127 per cent blowout in the waiting lists compared to the state average. There are 1444 social housing properties in my electorate, but there are 669 applicants who have been assessed and are in need of social housing. That is not just individuals.
That is families within that number—people with children needing to go to school, needing to have some stability. It is a really critical situation. As I say, I have people in my office consistently.
So I feel that when we talk to the government about this we see that they need to increase social housing in my electorate alone by 46 per cent just to accommodate this waiting list. But the minister spoke to the local paper and he went on the record saying that in the past five years the government has acquired 18 new properties in the area, and that pretty much covers the whole western part of the state, from Horsham down to the coast.
He also said there are another eight units coming in Warrnambool. Remember, I said we need 669—that would meet the current demand. So eight was his response to 669. It is simply not enough.
The government is ignoring the crisis—and this has been developing in the south-west for the last five years—and has essentially sat on its hands, and this legislation will do absolutely nothing but worsen than.
The state government is happy to brag about building additional social housing in Victoria, but the reality is these investments are in Ballarat and Geelong. When they call their investments ‘regional’ it is Ballarat and Geelong despite South-West Coast being among the region’s electorates with the highest number of homeless people—another example, and I spoke about this yesterday, of really good press releases on how the Labor government care, but really no action.
Really when you scrape back the surface, what you are seeing is very big lack of care. So now people will be saying my electorate is being ignored because I am from the opposition, but the reality is that the government is just ignoring the country.
It has a really big history of ignoring the country. Today we saw the Real Estate Institute of Victoria’s chief executive officer Gil King say that incentives are needed for home owners to rent out their homes rather than offer them through Airbnb, or holiday accommodation, he called it—market failure.
We are seeing rental prices in my part of the world go up a significant amount from a mean price of $340 a week for rent to $360. This is a huge increase for people who are trying to manage the cost of living, which is blowing out of control. People are coming into my office talking about how they cannot afford to pay their electricity bills, they cannot afford rent and they cannot find rent.
The real estate institute continued by saying that as competition grows it will be increasingly tough, so I urge the government to think hard about what they are doing.