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Tenants trust landlords more than agents
Victorian landlords have been seen as more relaxed and flexible, fostering smoother tenant relationships compared with agents.
The Consumer Policy Research Centre (CPRC) has revealed that just one in six Victorian renters had high confidence in the rental market, with tenants experiencing more challenges when dealing with agents than landlords.
According to the CPRC’s inaugural Renter Confidence Index (RCI), only 16 per cent of Victorians recorded a confidence score over 90, indicating high satisfaction and no major tenancy issues.
The average confidence score was 70, with renters who scored lower more likely to have experienced higher rents, financial difficulties, and to have dealt directly with agents rather than landlords.
According to the data, 83 per cent of renters who dealt directly with their landlord reported a positive relationship, compared to 66 per cent of those who dealt with an agent.
“Renters who deal directly with landlords often describe a more relaxed, respectful dynamic, while renters dealing with agents found the relationship more procedural and less flexible to their needs,” the report said.
In addition, Victorian renters who dealt with an agent were 52 per cent more likely to face rental challenges than those who dealt directly with a landlord, and were 13 per cent more likely to have unresolved issues.
Despite renters finding landlords to be more relaxed, LJ Hooker head of property management ANZ, Cathie Crampton, said they may be less likely to keep up with regulatory changes than agents.
“In recent years, Victoria has had extensive regulations imposed, and the shift has been marked in this regulatory direction,” she said.
“A key example is the minimum housing standards, which are a significant expense for many landlords.”
However, to boost renter confidence, Crampton said agents needed more education and to adopt more proactive communication with both property owners and tenants.
“Running webinars and similar digital output to these audiences would help, as would process enhancements around lease renewals and incoming tenancies.”
Crampton said that agents should conduct extensive reviews of their routines and enhance their in-house training with specialist support from companies set up to focus on compliance.
“Furthermore, agents can partner with finance partners who can support larger expense items via low-interest loans for those upgrades that may be extensive,” she said.
More broadly, the data revealed that 79 per cent of Victorian renters reported encountering at least one challenge over the past 12 months in relation to their rental arrangement.
However, of those who experienced issues, just 52 per cent made a complaint, while 39 per cent gave up, moved or did nothing.
According to the report, 54 per cent of renters were worried about landlord retaliation, underpinning the reluctance to complain about issues.
Additionally, it revealed that families were prone to facing major struggles, including financial hardships and end-of-lease challenges.
Renters with children were 54 per cent more likely to experience end-of-lease issues compared with those without children.
Further, the data found that renters without children were twice as likely to have their rental issues resolved as those with children.
According to CPRC CEO Erin Turner, the results reflected that Victoria’s 1.5 million renters are struggling with rent increases, unsafe properties and the difficulty of enforcing existing laws.
“It remains a poorly understood market despite providing an essential service to more than a third of Victorians.”
“The inaugural Renter Confidence Index shows that the work the Victorian Government is doing to standardise application processes and strengthen bond claims is much needed and will help renters,” she concluded.