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How to proactively and peacefully manage legislative changes with your landlords

Property managers looking to create a smooth path to legislative compliance with their landlords need to be proactive when changes are introduced, according to an industry leader.

Real Estate Institute of Victoria 2023 Property Manager of the Year, Tilly Gillan, delivered the advice after the State Government this week announced proposed new minimum rental standards, designed to make them more energy efficient.

Ms Gillan, who is also the Head of Property Services for Melbourne Real Estate, said the key to see landlords implement changes as easily as possible relied on good communication.

“Be proactive,” Ms Gillan said.

“With any legislation change, they don’t come into effect immediately. 

“So it’s not like they announce it today and it’s in effect tomorrow. 

“Start building it into the conversation with your clients as early as possible.”

In response to the proposed new standards released this week, Ms Gillan said her team called a meeting about them the morning after they were announced.

“Our team got together straight away to think about, ‘what are these proposed changes’, ‘What do they mean?’ and ‘How can we start communicating that with our clients?’” she said.

The proposed changes include rental providers needing to meet minimum requirements for ceiling insulation if there is none already installed, including draught sealing and weather seals on all external doors and replacing hot water and heating systems with energy efficient electric appliances when their current appliance reaches the end of its life.

The standards would also introduce a 3-star cooling rating for systems in the main living area, 4-star shower heads in every shower and blind cord anchors. 

Ms Gillan said one way to raise the changes with landlords would be to work it into the conversation next time a routine inspection was conducted or a maintenance request came in. 

“So what we would do with our team is, any time you have a maintenance request to do with cooling, once you’re having those conversations about those repairs, it’s just a simple, ‘Oh, did you also hear that there is talk about, from October next year, needing to implement a fixed cooling system’?” she said.

“‘If you don’t have one, can you look at doing one or, rather than repairing the current unit, can you replace it with a fixed unit to ensure that by the time it does become legislation, you’re already sorted’.” 

Ms Gillan said another way to communicate changes or proposed changes was to include it in your monthly newsletter to clients or to simply pick up the phone and tell them about it. 

She said sometimes landlords misunderstood legislative changes were from the State Government and believed they came directly from the property managers themselves.

At times, this has led to property managers having to cope with upset or angry clients.

In instances like this, Ms Gillan said the best way forward was for PMs to sympathise with their landlords but to also make it clear the requirements were law and outside their control.

She said often rental providers were worried about cost, especially in Victoria, where recent changes to land tax and other compliance factors have proved expensive.

“I always say to clients, ‘I know it’s frustrating. I know it’s hard and if I could change it, I would. But unfortunately it is legislation and everyone in Victoria, who’s a rental provider, is in the same boat as you’,” Ms Gillan said.

“‘So we do have to look at getting it done, and this is how I’m going to help you to ease some of those concerns’.

“You can say, ‘Yes, we can set up a payment plan’ or ‘Why don’t we look at installing this in the next six months’ or whatever it may be, to really ease that burden for the clients.”

Ms Gillan said explaining the goals behind the changes often also helped bring landlords onboard.

“The idea behind it is to improve living standards for renters,” she said of the latest round of proposed changes.

“So you can always say, ‘Put yourself in their shoes. If it’s 10 degrees in the middle of winter you would have heating on. So why would you stop somebody else from having that?

“It’s really about taking the time to proactively have these conversations and approaching it from a position of not being reactive.

“Think of all the questions you think your client is going to ask and proactively communicate that with them, so they don’t have a reason to come back to you, make it personal and fight it.”

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Kylie Dulhunty

Kylie Dulhunty is the Editor at Elite Agent.