New tenant laws bring challenges for your body corporate

New tenant laws in Queensland will affect the way a body corporate deals with maintenance and by-law issues adding complexity and costs for owners.

Stage one of Queensland’s Housing Legislation Amendment Act 2021 is due to take effect from October 1, 2022. The act aims to better regulate leased properties across the state with the central goal of giving tenants safety and security in the places they rent. The new rules make it easier for tenants to have pets and require landlords to meet minimum standards over key areas such as mould and security. As the pressure on landlords increases, so too will the pressure on a body corporate to ensure the new standards in tenant laws are adhered to. Let’s have a look at what’s set to change:

Pets

From October, a landlord can only refuse permission for a tenant to keep a pet on reasonable grounds. This law echoes the current status of pet ownership in body corporates, where it is now considered standard that owners are allowed to have at least one pet at their property. However, until now many rental properties will have simply had a no pets policy which will have naturally restricted the number of animals in body corporate schemes.

Body corporates can now expect to see more applications and more pets in their buildings. And, while we all love our own furry friends, we also know that in strata schemes, pets bring problems with noise, mess, damage and so on. As the number of pets increases, so too will the volume of problems and complaints.

The reaction to this is likely to be much more defined and complex by-laws regulating the control of pets on the common property. This is a trend that has already begun with a growing number of schemes instituting new by-laws that more explicitly set out what pet owners can and can’t do with their animals.

Minimum Housing Standards

Body corporates already have standards around the maintenance of common property and few would disagree that all occupants deserve reasonable living conditions.

The Rental Law Reform seeks to better establish what that means for tenants, and in doing so, it is likely to open up new areas of consideration and dispute for how body corporates undertake repairs and how they interact with investor owners.

From October 1, prescribed minimum housing standards require:

• The premises to be weatherproof and structurally sound.
• Fixtures and fittings to be in good repair and not likely to cause injury to a person.
• Locks on windows and doors.
• The premises to be free of vermin, damp and mould.
• Privacy coverings.
• Adequate plumbing and drainage.
• Functioning kitchen and laundry facilities (where supplied).

When moving in, tenants will have 7 days to complete and return the entry condition report and tenants and property managers can authorise emergency repairs up to the equivalent of 4 weeks’ rent.

There is a lot to think about for body corporates in that. Start with the old chestnut of who is responsible for mould and damp and go from there. Are pests an owner’s issue or a body corporate issue? How does the idea of privacy coverings fit in with factors such as the external appearance of the lot? These are not new issues for body corporates but the change in emphasis to empower tenants is likely to mean that they become more common areas of concern.

Navigating the path between who is responsible for what is going to become more treacherous. If tenants put pressure on landlords then those same landlords will put pressure on body corporates. Some of that pressure will be pushed back. If a new tenant moves into a property and reports a range of issues that need to be addressed under the new reforms, body corporates are likely to ask the owner why they weren’t reported before. They are going to have to consider whether the owner has been negligent in not maintaining the property or reporting concerns. Perhaps there will be more disputes that require an adjudicator. Either way, more pressure will lead to more disputes and higher costs. Start factoring in this change now.

Ending Tenancies

There are new grounds for renters to end tenancies, including that the property is not in good repair, or does not comply with the minimum housing standards.

Again, body corporates should always meet minimum standards, but it is not hard to think of circumstances where this new rule can lead to a dispute, as there can easily be differences over whether a minimum standard is met, whether a property is in good repair and what is a reasonable timeframe for a repair.

This kind of discussion commonly takes place after emergencies that affect the habitability of a unit. It can take time for repairs to be arranged and insurance claims to be processed. Tension and frustration can build up quickly even when the body corporate is doing everything it can to resolve the issue. If a tenant leaves a property because of a delayed repair, the body corporate could now be facing a major issue.

Over the long term, this kind of change is likely to be a good thing. Most body corporates should do more to maintain the common property and limit loss. They should have more funds in reserve to deal with problems and owners should participate more to assist with decision making to get these types of issues fixed. In reality, many body corporates are short on funds and owners do not have spare time to resolve these issues. Costs for maintenance and resolution would have to increase considerably at most schemes to keep these issues at bay. Long term the market will adjust, but things may well get worse before they get better.

Read more about the Housing Legislation Amendment Act 2021

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For more information about how your scheme can manage this issue, contact your manager:

Tammy Lynch: tammy.lynch@towerbodycorporate.com.au P: 0466 156 765
Samantha Morrison: samantha.morrison@towerbodycorporate.com.au P: 0434 670 058
Kelly Borell: Kelly.borell@towerbodycorporate.com.au P: 0435 766 852
Will Marquand: will.marquand@towerbodycorporate.com.au P: 0427 125 656