Having your investment property make money and not acquire unexpected and preventable costs is key to running a successful business. This not only relates to maintenance and repair but also legal fees and fines from non-compliance with current legislation. With the Healthy Homes requirements now in full swing, landlords have a legal obligation to comply with the Healthy Homes Standards under the Residential Tenancies Act 1986. 

As part of these new standards, a landlord will also be required to comply with any requirements for record-keeping and statements in the tenancy agreement. And, if these are chosen to be ignored, a tenant can hold a landlord accountable and apply to the tenancy tribunal for compensation. 

If you’re not familiar with the latest laws implemented by our government in 2019, then here is a recap of the Healthy Home Standards requirements, and your obligations to each:

Heating – There must be fixed heating devices, capable of achieving a minimum temperature of at least 18℃ in the main living room. Some heating devices are inefficient, unaffordable and unhealthy and will not meet the requirements under the heating standards. Learn more about the heating requirements for a rental property here.

Insulation – The minimum level of ceiling and underfloor insulation must either meet the 2008 Building Code or (for existing ceiling insulation) have a minimum thickness of 120mm.

Ventilation – Ventilation must include windows in the living room, dining room, kitchen and bedrooms that can open. Also, an appropriately sized extractor fan(s) in rooms with a bath or shower, or indoor cooking top.

Moisture ingress and drainage – Landlords must ensure efficient drainage and guttering, downpipes and drains. If a rental property has an enclosed subfloor, it must have a ground moisture barrier, if it’s possible to install one.

Drought stopping – Landlords must stop any unnecessary gaps or holes in walls, ceilings, windows, floors, and doors that cause noticeable draughts. All unused chimneys and fireplaces must be blocked.

From 1 July 2021, a landlord will have to comply with the standards within 90 days of the start of a new or renewed tenancy.

What are the penalties for non-compliance?

The Tenancy Tribunal now has the authority to issue a legally binding order to a landlord informing them of work that needs to be done to their property to make it compliant. If the landlord is unable or unwilling to comply, the Tenancy Tribunal is now responsible for issuing fines to those properties that are non-compliant.

The process for this is quite simple; if a landlord is non-compliant with the Healthy Homes Standards, a tenant can apply to the tribunal for a monetary order and/or work order. Once the complaint has been filed the Tenancy Tribunal may award exemplary damages, with a financial penalty of up to $4,000 against the landlord. This is usually awarded to the tenant as compensation and the amount given depends on the landlord’s intention and the effect the non-compliance has on the tenant. The Tribunal may also award compensation for any material loss or general damages. These can include; intangible and tangible loss, stress, humiliation and inconvenience suffered by the tenant due to the landlord’s non-compliance.

It’s also important to note that landlords in possession of multiple rental properties may see increased fines for non-compliance. If a landlord owns 6 or more rental properties the penalties they face are likely to be higher than seen by those landlords with fewer properties.

What documents does a landlord have to provide in a tenancy agreement under the healthy homes standards?

Landlords need to attach additional healthy homes statements to new, renewed or varied tenancy agreements – Tenancy Services

As part of the Healthy Homes compliance, landlords need to attach Healthy Home statements to new, renewed or varied tenancy agreements. There is a $500 fine for landlords who do not provide the Healthy Home Standard (HHS) compliance statement with the tenancy agreement.

The compliance statement template is comprehensive and covers all five healthy homes standards and exemptions, including, the outlined ventilation, insulation, heating and energy efficiency standard. Landlords that do not present or comply with the Healthy Homes compliance statement for all tenancies from the 11th February 2021 onwards, could result in an infringement offence and financial penalty. This certificate is essential in ensuring that landlords meet their obligations under the Residential Tenancies (Healthy Homes Standards) Regulations 2019.

It is also important that all landlords maintain any records that show they are compliant with all standards. Such documents that landlords may wish to keep are:  

• Any records of building consents regarding the building work concerning the standards.  
• Any records from professionals or labourers who did any building work concerning the standards.  
• Photographic evidence of compliance.  
• Copies of inspection reports. 
• Receipts/invoices for material and labour.  
• Any other salient records or documents. 

These records would be good for a landlord to keep regardless, as they are records that landlords would have to retain as part of running their business and having access to these documents may help with resale value

If your rental property is not compliant with the Healthy Home Standard within 90 days of a new tenancy from July 1st 2021, you may be liable for a fine. If you’re unsure whether or not your rental property complies, you can take our Healthy Homes Quiz. 

We understand that there are a lot of rules and regulations that must be followed when it comes to owning an investment property. This is where our team of trusted and highly trained professional property managers can help. If you would like to take the stress away from the day-to-day running of your rental property portfolio then contact us today to discuss our property management services. We also take care of the Healthy Home requirements so you don’t have to.