New rental rules were announced recently but they are more like minor tweaks than big reforms. Compared to the March 2021 rental rules revamp, these changes look like political window dressing than meaningful change. They do however, put additional importance on the quality of rental agents’ advice to owners and renters. Good agents will help navigate everyone through the rental property process constructively and fairly.
The changes come into force in November 2025, so we have time to prepare.
Here is what’s coming…
1. Rent bidding rules tightened up
Rent bidding (encouraging rental offers over the asking rent) has been outlawed for some time. Currently, if a tenant offers more than the advertised rent, or several months’ rent in advance (unsolicited) the owner can accept it. Under the new rules this will be prohibited. Only the asking rent or below can be accepted.
Under the new rules, if an owner or agent is unsure about how much rent to ask, what do you think they will do? Ask for a higher rent or a lower rent? Correct… A higher rent. They can always reduce it or accept a lower offer, but they won’t be able to accept a higher offer.
While the rule aims to make the process fairer, it may push asking rents higher. Owners, unable to discover “what the market will pay” via offers, may err on the high side to avoid leaving money on the table. Agents will likely counsel landlords to list properties at the upper end of market ranges, especially in high-demand suburbs.
On the renter side, those willing to pay more to secure a property (but unable to) will need to compete in other ways such as speed and presentation. Pressure will be on renters to submit full documentation upfront, write a cover letter pushing their case, or provide additional financial documentation to demonstrate security. Anything to win the property. Maybe a bit of old fashion shmoozing of the leasing agent to stand out.
Gone are the days of someone saving up, moving town and offering a few months’ rent in advance while they get a job and settle in and establish a rental history.
2. Increased notice periods (60 → 90 days)
The notice period for both rent increases and notices to vacate has been increased from 60 to 90 days.
The longer lead time reduces uncertainty for tenants by giving them more notice about the impending change. The notice period applies even if the renter is on a monthly tenancy. Extending the notice period by 30 days has no material impact on owners really, provided everything is planned out well.
Given the speed at which rental markets can change, some agents and owners may look to pull forward forcast market growth over the 90-day notice period into the rent increase calculation.
3. No-reason evictions tightened
In the bad old days (pre-March 2021) an owner or agent could ask a renter to move out in 120 days for no reason (so long as they were not in a lease). Since then, the only “no reason” eviction permitted, is at the end of the first rental term with 90 days’ notice. This allowed both the owner and renter to get comfortable with each other before moving beyond the initial term.
Under the new rules, that will be prohibited.
So, if a renter is not in default of the lease, and there is no complying grounds for asking them to move out, (eg. selling, owner moving in or renovating) there is no pathway to vacating the renter… ever.
This will give renters more security of tenure in their home.
In response, landlords and rental agents will become more conservative when selecting tenants. They will opt for applicants with better financial records, stable employment, plus strong rental history and references. Unfortunately, the new rules mean riskier applicants, including younger renters, casual workers, less stable shared arrangements and new renters with no rental history, may struggle to find housing, even more than before.
Owners may prefer to leave a property vacant for longer than accept a suboptimal applicant sooner.
4. Other changes
There are some other changes including,
- Standardising rental application forms.
- Banning any cost to tenants for rent payment or application methods.
- Enforcing minimum property standards from the advertised date.
5. Overall impact of changes
These changes augment the March 2021 changes to residential rental rules. They are designed to support renters and protect them when finding and living in their home. Having a safe and secure home is a key building block of life.
When Sir Isaac Newton described his third law, “for every action, there is an equal and opposite reaction”, he probably didn’t have property law in mind. But Victoria’s rental reforms over the last 4 years proves that this principle doesn’t just apply to physics. Every policy shift, no matter how well-intentioned, sends ripples through the rental market. The rental protection laws are no exception.
The new rental protections are designed to provide more security and protection for renters. Many of these changes do just that. But as Newton taught us, no action happens in isolation. Every new rule sets off a chain of reactions. Some predictable, some unintended.
For property managers, the challenge now lies in interpreting these reforms not just as compliance requirements, but as market signals. Owners will look to their agents for advice on how to adapt. Whether it’s pricing strategy in a no-bid world, lease structuring in the face of longer notice periods, or application screening when eviction pathways narrow.
For renters, the changes will bring a mix of opportunity and complexity. Some will benefit from added protection. Others may find that competition becomes even more focused on presentation and pre-qualification rather than price.
Ultimately, the success of these reforms will depend on how the market behaves in response. Because just like in physics, in property management, every action invites a reaction.
