(Real Estate Institute of Victoria,REIV, a state-of-the-art real estate agency, claims that if Andrews government`s lease case becomes official, many landlords will remove their homes from the rental market, according to Domain.
The 5000 members of the state real estate agency, mainly real estate agents and landlords, said the reforms proposed by government were "too harsh" and could upend the state`s entire rental market.
Victoria`s government has promised to present the long-awaited lease bill to Congress this week. The bill was first introduced last October. Although details of the bill have not yet been released, the government has referred to many of the 130 reforms.
Under the reform bill, landlords can ban tenants from keeping pets and bidding for rent only after receiving the rules of the state civil and administrative tribunal, and rent increases are limited to once a year.
Deposits on rentals will be limited to four weeks` rent, and tenants can make minor changes to their homes without the permission of their landlords. Each rental house needs to meet the most basic safety standards, with heating and locks.
Richard Simpson, chairman of REIV, said the new bill would, as it stands, push up rents and lead landlords to be more cautious in choosing tenants.
"there have been a lot of people who have told us that if these reforms pass, they will take down the investment properties that are placed in the private rental market," Simpspn said.
This will put more pressure on the already tight rental market, Simpson said. The state`s vacancy rate is already at a 10-year low of 1.8%, according to data.
But Wendy Stone, an associate professor of housing and public policy at Swinburne University, said there was no sign that investors would withdraw from the private rental market on the basis of these reforms.
"the current tax cuts for investors are very generous," Stone said, noting that these reforms are the first in Australia and place investors in a responsible housing provider.
Mark O`Brien, chief executive of the Victorian tenant Association, said the claims that a large number of landlords had withdrawn were "groundless alarmist."
"if a landlord wanted to withdraw from the rental market and sell the house, the following would happen. In the first case, a home buyer will be able to buy the house. In the second case, another investor realized that the reforms were fair and put them back in the rental market. "
He added that if the house was vacant, government would charge owners a new vacancy tax.
Landlord "Michael" told 3AW Radio on Monday that he was considering withdrawing his six rental homes. Michael points to rising fees and government`s reforms. "I feel like I can sell it and enjoy it now," he said. The tenant has all his rights. "
The bill is expected to pass through the House of Commons, but may be shelved in the Legislative Council, as smaller parties and the Greens control the balance of power.
A powerful advocacy group in Victorian politics, REIV is calling on members of the House of Lords to oppose these reforms.
Supporters of the reform bill now say it may not pass parliament before state government elections on Nov. 24.
REIV has expressed strong opposition to government`s plan to abolish a 120-day plan to expel tenants for no reason.
Simpson argues that if tenants behave badly, landlords are more likely to expel tenants than just give them a warning or give them another chance. "tenants need to do well."
Individual Housing Providers Association is another real estate investor advocacy group. The agency warned that the reforms could put landlords away from the private rental market in favour of short-term rents.
Co-founder John Mills said: "landlords may think that for the moment, renting a house on Airbnb is actually simpler, and they can also better control the social background of tenants. We can do a better job of vetting. "
