On 1 February 2019, the Victorian Government enacted changes to the Owners Corporations Act 2006 by regulating short-stay letting arrangements.

The amendments are only concerned with regulating short-stay arrangements that are leases or licenses for up to seven days and six nights in relation to the whole or part of an apartment.

Pursuant to the new regime, an apartment owner or former owner, occupier or a manager or agent may make a formal complaint to the Owners Corporation if a short-stay occupant interferes with the peaceful enjoyment of other unit occupiers by:

  1. Creating unreasonable and disruptive noises;
  2. Behaving in an unreasonable and substantially inappropriate manner;
  3. Using common property in a hazardous manner that raises health and safety concerns;
  4. Unlawfully obstructing the lawful use of the common property; or
  5. Damaging or altering a lot or the common property or a structure that forms part of a lot or common property either intentionally or negligently.

The Owners Corporation can issue a Breach Notice for an alleged breach or apply to the Victorian Civil and Administrative Tribunal (“VCAT”) to resolve the dispute in relation to the breach.

VCAT has jurisdiction to resolve a dispute and may make orders it considers fair at its discretion, including but not limited to:

  1. Prohibiting the use of the premises so as to not include short-stay letting provided that at least three Breach Notices have first been issued within a twenty-four month period;
  2. Awarding compensation of up to $2,000.00 to each affected occupier for loss of amenity; or
  3. Imposing a civil penalty of up to $1,100.00 payable to the Victorian Property Fund.

What does this mean for short-stay occupants?

Short-stay occupants need to ensure that they do not interfere with the peaceful enjoyment of other occupiers so as to cause a grievance or they may be penalised or prohibited from occupying a residence (short-stay accommodation).

What does this mean for apartment owners?

Apartment owners need to give consideration to letting their property for short-stay accommodation in circumstances where they are at risk of being jointly and severally liable for satisfying any compensation order or civil penalty ordered.

What does this mean for owners corporation managers?

Owners Corporations will need to carefully manage short stay letting and only issue a Breach Notice if there are reasonable grounds to believe that the short-stay occupant has committed the alleged breach.

It is important that Owners Corporation Managers are aware of the legislative requirements in relation to issuing Breach Notices, in not pursuing a grievance raised by a complainant or in reporting at the Annual General Meeting to ensure they comply with their statutory obligations.

If you require further advice on the recent legislative changes and how these affect you, please contact our Property & Development Team