A Guide to Legal Duties for Self-Managing Landlords

Owning and managing rental properties can be demanding, especially if you’re not fully aware of your legal responsibilities. As a self-managing landlord, you need to be well-versed in the legal obligations tied to property management.

It’s crucial to stay updated on state and local regulations, fair housing laws, security deposit rules, eviction procedures, and other rental-related matters. Fortunately, Motion Property is here to guide you through these complexities!

This guide will help you navigate the legal landscape of property management, giving you the confidence to manage your rental smoothly. Let’s dive in!

Knowing Your Legal Responsibilities

As a landlord managing your properties, understanding the legal landscape of property ownership and rental management is essential. Whether you’re new to this or an experienced landlord, you must be familiar with state and local regulations, fair housing laws, security deposits, eviction processes, and other vital aspects of renting out your property.

Here’s why it’s important to stay informed about your legal responsibilities:

Compliance with state and local regulations Each state has specific laws governing landlord-tenant relationships, and as a self-managing landlord, it’s your duty to know and follow these rules. Ignoring these laws can lead to substantial fines and penalties.

Protection against legal disputes If tenants feel their rights are violated or believe you’re not adhering to legal standards, they may pursue legal action, potentially leading to disputes or tribunal cases.

Building positive tenant relationships By understanding and fulfilling your legal obligations, you show tenants that you respect their rights and care about their well-being, which can foster good landlord-tenant relationships.

Ensuring a smooth rental experience Following legal requirements helps both landlords and tenants enjoy a hassle-free and successful rental experience.

Understanding State and Local Laws in Australia

One of the most important aspects of managing rental properties is understanding the legal requirements specific to your location. These regulations cover everything from eviction procedures and security deposit rules to non-discrimination laws and property maintenance standards. As a self-managing landlord, it’s your responsibility to familiarize yourself with these regulations, as failure to comply can result in legal issues or financial penalties.

In Australia, rental properties must meet certain standards to ensure tenant safety and well-being. Some of the key legal obligations include:

Property standards:

You are required to provide tenants with a safe and habitable living environment. This includes ensuring that the property is structurally sound, well-ventilated, and equipped with functional electrical systems.

Maintenance and repairs:

It is your responsibility to promptly address any repair requests and maintain the property in a habitable condition, including essential services like plumbing, heating, and cooling systems.

Privacy and access:

You must respect your tenants’ privacy by giving proper notice before entering the property for inspections or repairs, except in emergencies.

Rent increases:

Any rent increases must comply with regulations set by your state or territory, including adhering to restrictions and providing required notice periods. For more details on rent increases, you can refer to state-specific guidelines.

You can also check the relevant websites for your state to learn more about local rental laws:

Victoria: Consumer Affairs Victoria – Renting

Fair Housing laws prohibit discrimination against potential or existing tenants based on certain protected characteristics. This means landlords cannot refuse to rent or treat tenants unfairly because of:

• Race or ethnicity: It’s illegal to discriminate against someone based on their race, color, nationality, or ethnic background.
• Gender: Discrimination based on gender or gender identity is prohibited.
• Disability: Discriminating against individuals with physical or mental disabilities is illegal, and landlords must provide reasonable accommodations for tenants with disabilities.
• Family status: You cannot discriminate against tenants with children or those who are pregnant.
• Age: Discrimination based on age, whether young or old, is prohibited.
• Sexual orientation: It’s unlawful to treat tenants unfairly based on their sexual orientation.
• Fair Housing laws also require you to provide reasonable accommodations for tenants with disabilities, such as modifications to the property or exceptions to rules, to ensure equal access to housing. These might include installing wheelchair ramps, allowing service animals, or providing accessible parking.

To avoid legal issues related to fair housing, consider the following practices:

• Understand and adhere to the specific fair housing regulations in your area.
• Use consistent and objective criteria when screening potential tenants, focusing on rental history, creditworthiness, and references, rather than personal characteristics.
• Treat all applicants equally, regardless of race, gender, disability, family status, age, or sexual orientation.
• Be responsive to requests for reasonable accommodations from tenants with disabilities.
• Keep detailed records of all tenant interactions, applications, and rental decisions to demonstrate compliance with fair housing laws.

Keeping Rental Properties Safe and Habitable

As a landlord, you are responsible for ensuring that your rental property is safe and habitable for tenants. This means maintaining essential services like water, electricity, gas, and plumbing, and addressing any repair or maintenance needs that arise. Key responsibilities include:

• Structural integrity: You need to maintain the structural soundness of the property, including the roof, walls, floors, and foundation. Any issues that could compromise safety must be addressed immediately.
• Plumbing and electrical systems: Ensuring that the plumbing and electrical systems are in good working order is crucial. This includes fixing leaks, resolving electrical issues, and maintaining water supply and drainage systems.
• Heating and cooling: You should provide proper heating and cooling systems, especially in regions with extreme weather, to ensure tenants have a comfortable living environment.
• Essential amenities: Ensuring that key amenities like toilets, sinks, showers, and stoves are functioning correctly is part of your responsibility. Any faulty or broken fixtures should be promptly repaired or replaced.
• Pest control: You must take action to prevent and address any pest infestations, ensuring the property remains pest-free.
  Conducting regular property inspections is essential to identify and address potential issues before they escalate.

During inspections, you should:

• Check for safety hazards like faulty wiring, loose handrails, trip hazards, or non-functioning smoke detectors.
• Assess the condition of the property’s roof, walls, windows, and doors for any signs of wear and tear.
• Inspect plumbing fixtures, water supply, drainage systems, and electrical outlets to ensure they are in good working condition.
• Test the functionality of essential appliances like stoves, ovens, refrigerators, and air conditioning units.
  For more information on conducting routine inspections, click here.

If any health or safety concerns arise, it’s important to act quickly to resolve them and ensure that the property remains safe for tenants.

Managing Security Deposits (Bonds)

The security deposit, often referred to as a bond, is a sum of money that tenants pay when they move into a rental property. As a landlord, you are responsible for managing this deposit according to legal requirements.

When it comes to collecting and handling security deposits, there are specific rules you must follow:

• Amount: There are limits on the maximum amount you can collect as a bond, which varies by state and territory. It’s essential to know the specific limits in your area.
• Documentation: You should provide tenants with a receipt or written acknowledgement of the bond payment, including details like the amount paid, date of payment, and property address.
• Separate account: In most states, you are required to deposit the bond into a separate account with the appropriate bond authority within a specified timeframe, keeping it separate from your personal or business funds.

Making deductions:

You may be able to deduct funds from the bond to cover certain expenses, such as unpaid rent, damage to the property, or cleaning costs. However, any deductions must be reasonable and well-documented. Be sure to keep thorough records, such as photos, inspection reports, and receipts, to support any deductions you make. For more details on making a claim against the bond, click here.

Maintaining Organised Records:

Effective organisation is critical for successful property management. As a self-managing landlord, it’s important to keep accurate and organised records for each of your rental properties. Key records to maintain include:

• Signed lease agreements and tenancy documents for each tenant.
• Detailed inspection reports from the start and end of each tenancy.
• A record of maintenance or repair work, including dates, costs, and descriptions of the work performed.
• Documentation of all payments made by tenants.

Maximise and Protect Your Investment with Motion Property

Managing a rental property on your own can be time-consuming and challenging. Hiring a professional property manager doesn’t just save you time—it’s a smart move for maximising and protecting your investment returns.

At Motion Property, our experienced property managers are proactive in looking after your property, ensuring it stays competitive in the current market. We make sure your property is well-maintained to industry standards and is returned to you in the same condition at the end of every lease. Should any issues arise, our team is ready to represent you at VCAT, providing you with peace of mind.

Plus, all the costs associated with our property management services are tax-deductible, making it an even more valuable investment in your property’s future.

Curious if your property is performing at its best? Contact us today for a no-obligation investment property health check. We’re more than happy to review your property’s performance and offer insights on how to optimise your returns.