10 year rental agreements considered by Victorian government

Benjamin Preiss, State Political Reporter for The Age, Ju

Renters could secure tenancies for 10 years at a time under a proposal being considered by the state government.

The Andrews government is reviewing residential rental laws to ensure Victorians can access "safe, affordable and secure housing".

The proposal for long-term leases could lead to major change in Victoria's rental culture, which is dominated by 12-month leases.

In some European countries long-term renting is far more common, providing security for tenants and guaranteed income for landlords.

The review will examine the viability of five to 10 year leases. The government will also look at stronger protections for older renters and those living in caravan parks.

Five year tenancies can be secured in Victoria but the Residential Tenancies Act does not cover landlords and tenants in longer agreements.

Consumer Affairs Minister Jane Garrett said the government was reviewing the act to protect renters and guide landlords about their responsibilities.

"We're making sure laws around renting strike a fair balance between the rights of people who live in a rental property and the people they rent those properties from," she said.

The government has called for submissions on how the residential tenancies act can be improved.

A discussion paper that sets out the review's scope said significant numbers of households were already renting for longer periods while private rental was becoming increasingly expensive.

Swinburne University's Institute for Social Research senior researcher Wendy Stone said the Victorian rental market needed a broad range of options, including long-term tenancies.

"The types of households that now rent are really diverse," she said.

Dr Stone said longer tenancies would bring stability to renters who wanted to settle in one place rather than having to move often.

Her research had shown almost 40 per cent of private tenants moved three or more times in five years.

Dr Stone said longer notice periods for renters wanting to leave extended tenancies could allow them to avoid expensive fees when leaving a lease.

"The penalties that currently apply for tenants can be absolutely crippling."

Dr Stone said Australia's rental market was "lightly regulated" by international standards, allowing landlords to evict tenants without a strong reason.

Tenants Union of Victoria chief executive Mark O'Brien said he supported the review. But he said security of tenancies would not improve by mandating longer fixed-term agreements.

"We think that's the wrong approach and tenants themselves would not support it."

He said he would not support long-term fixed agreements under the current lease-breaking and rental increase conditions.

"If your circumstances change and you want to move you can't or you have to compensate the landlord."

Mr O'Brien said the rental market had changed markedly with more people renting for longer periods of time.

"A lot of people are stuck in the rental market in their late 30s. It's a very different rental market."

He said more people on low incomes were unable to buy their own properties and would never become home owners.

The final stage of the review will include an "options paper" setting out proposals for improving the tenancies act.