Hynes Legal: QLD Rental Law Reform- How it Could Impact the Strata Sector

The proposed changes follow consultations with the community and have not even reached draft legislation yet, but as you would expect they will affect all property managers. There will also be some unintended (or perhaps misunderstood) consequences for bodies corporate with respect to the rights of tenants.

Bodies corporate traditionally don’t have a lot to do with tenants or letting, but they are going to need to be ready if some of these proposals become law.

The key practical areas for the proposed changes are:

  • Ending tenancies;
  • Minimum housing standards;
  • Property modifications;
  • Renting with pets.

In simple terms:

Ending tenancies

There is a concern that tenants sometimes refrain from exercising their tenancy rights for fear that the landlord may simply terminate their tenancy without cause as a consequence of that.

Landlords may no longer have the right to terminate a tenancy without cause and would need a genuine reason. These will be set out in the Act. Tenants will also be given additional rights to terminate tenancy agreements in certain circumstances on short notice, such as in the event of domestic or family violence.

Minimum standards

Renting a property ‘as is, where is’ will essentially no longer be possible. A rented property would be required to meet certain minimum standards relating to matters such as:

  • weatherproofing and structural soundness;
  • plumbing and drainage;
  • security;
  • the standard of repair of fixtures and fittings;
  • control of pests and vermin;
  • ventilation, lighting and privacy;
  • cooking and food preparation facilities.

If those standards were not met, the tenant would have the right to apply through the QCAT to seek orders in relation to those, which could include not paying some or all of the rent until the complaints were addressed.

The reality is in strata most of these standards are a given. We think it is more of a risk for housing product, but there could be some interesting conversations in strata about security systems or leaks.

Minor modifications

Personal circumstances may require some tenants to have changes to be made to their rental property. These include:

  • tenants who require accessibility modifications to their property;
  • people with disabilities;
  • families with young children who require safety locks;
  • people experiencing domestic and family violence.

Minor modifications would be defined as alterations that can be reversed, do not permanently alter the rental property and do not require building or other approvals.

A second category of minor modification would require the tenant to obtain the permission of the landlord, which would be deemed granted if the owner does not respond to a request within seven days. These minor modifications would include:

  • personalising or improving the amenity of the property;
  • relating to energy and water efficiency;
  • relating to non-essential communications services, such as satellite television dishes.

At the moment, tenants need to seek the consent of their landlord for these modifications. A landlord does not have to agree to them, but the ability to refuse them is going to be limited. In almost all circumstances the tenant would have to return the property to its original condition when leaving the tenancy.

What doesn’t seem to have been considered yet is whether the rights to make modifications will extend to just the lot or to the common property as well. Some modifications may affect common property or other owners, and that the body corporate may have an interest in them. By-laws may require body corporate consent to some of these modifications, but there is no reference to that in the material issued by government so far.

It would be an interesting position if tenants had more rights than lot owners with respect to the right to make modifications, especially where owners may have the same personal circumstances.

Pets

At the moment a landlord has the absolute right to decide whether their tenant can have a pet or not. The proposal is that owners cannot refuse pets unless they have good reasons to do so, but owners could apply to the QCAT for orders that their property remains pet-free.

At least bodies corporate have been considered here and reasonable grounds for refusal would include:

  • an unacceptable risk to the condition of the property or to health and safety;
  • the rental property is unsuitable for the type of pet; or
  • keeping a pet would contravene a law or managed community by-law or rule.

We first wrote about pets in strata in 2010 and have repeatedly done so since. It’s not as if these proposed changes are going to make things in bodies corporate any easier, because it will only be the super-motivated owner who will head off to ask QCAT for an order about refusing a pet. So, we may suddenly have a swag of tenant/body corporate pet disputes looming.

Summary

We have a long way to go with this yet, but our immediate takes are:

  • Management rights operators are probably most at risk with these changes in the sense that if tenants are given additional rights that conflict with body corporate expectations, the management rights operator will have the finger pointed at them when the tenant does what they may be entitled to do at law. Resident managers do not enforce by-laws, but that won’t stop the inevitable confusion. That leaves aside management rights owners (like all property managers) having to manage their landlord owners on the new rights of tenants.
  • Strata managers do not traditionally have anything to do with letting, but to the extent that minor modifications affect the common property or breach some other by-law, the strata manager will be exposed to the same headaches (particularly in the schemes without management rights) and will have to look outside the BCCM Act for why a body corporate cannot do anything about it.
  • Committees are a bit like strata managers in that they usually do not have anything to do with letting, but it is inevitable that a lot of people are going to be unhappy when tenants exercise rights without body corporate approval that are not consistent with the scheme’s by-laws or previous expectations. If the body corporate is self-managed, poorly advised or someone on the committee doesn’t know how to use Google properly, the Commissioner’s Office helpline is going to need more staff.

The consultation draft lists a group a of stakeholders – being tenant, property owner, property manager, Government, social housing and community. ‘Body corporate’ is not yet on the list, but should be.

We can just imagine the grief when a tenant arrives one day with a pet, or a satellite dish just appears on a roof and no one on the committee knew about it.

There is no doubt that both the SCA and ARAMA will get involved to represent the interests of their members, but if you are interested enough to want to provide feedback personally, then click here. Submissions close 28 December 2019.

You can also click here for what is happening with rental reform in Victoria which seems to be very close to what is being proposed in Queensland.

Remember: this is not law – only discussion. The devil is always in the detail with these things, and until we see some draft legislation you never know for sure what will eventually happen.

Author: Frank Higginson, Hynes Legal

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