Coronavirus: Victorian rule outlaws occupied property inspections

The real estate industry has slammed new rules in Victoria outlawing inspections of occupied properties.

Real Estate Institute Victoria president Leah Calnan says this new change will have an immediate impact on sales activity.

The real estate industry has slammed new rules in Victoria outlawing inspections of occupied properties, which is likely to cause the market to grind to an immediate halt.

Victoria’s Consumer Affairs office blindsided agents late on Thursday when it put in place the new rules ahead of the Easter long weekend to stop the inspection of tenanted rental properties or occupied homes on the market.

The changes were made on advice from the state’s chief health officer in order to further social-distancing rules currently in place, removing the option for those currently living in the home to temporarily leave for an inspection to take place.

Real Estate Institute of Victoria president Leah Calnan said the industry was surprised by the decision, which was made after little communication, stating the eleventh hour change will have an immediate impact on sales activity.

“We're not aware of any trigger. We are not aware of any complaints against real estate agents or property managers or auctioneers about not complying with the social distancing or the hygiene process, nothing at all,” Ms Calnan said.

“It will shut down the market, absolutely, because there will only be a very small portion of listings that are vacant.”

Ms Calnan told The Australian the representative body was first contacted by Consumer Affairs via email on Wednesday, with clarification emails to the department and the Premier’s office not returned on Wednesday or Thursday. The new rules were sent at 5:30pm on Thursday evening to the REIV via a link to its official website.

“Agents must no longer conduct public or in-person private inspections of tenanted or occupied properties,” says the note on the Consumer Affairs website.

“This is because it will not be possible for agents, prospective owners or tenants, and existing tenants to each comply with their legal requirements under the current Directions from the Chief Health Officer.

“There is no exemption for tenants or occupants to temporarily vacate their place of residence to facilitate inspections.”
The latest instructions are independent of the official Victorian government restrictions.

Two weeks ago, the federal government introduced a ban on all public auctions and open homes, which saw the industry quickly pivot to virtual selling and private viewings. The latest changes will make the state the most restrictive real estate market in the country.

Ray White Group managing director, Dan White, said that while he understands the decision from a tenant's perspective, sellers entered into the sales process aware of the risks. He would like further clarification around the decision from the department and state government.

“Everyone in the house needs to be on-board with the process so I understand that forcing tenants to submit to an inspection is a different story,” Mr White said. “But for a homeowner to decide to sell their house and do it the safe way, we just want to understand more why that is not acceptable.”

Chairman of Melbourne real estate network Nelson Alexander, Duncan McPherson, said the company would be lobbying the state government alongside the REIV for a review.

“The ramifications of the changes haven't been as far thought through as it probably should have been,” Mr McPherson said. “So we're lobbying the government at the moment to ask them to reconsider and understand what this legislation means in its truest sense.”