Victorian Greens Propose Mandatory Landlord Licensing

The Victorian Greens have proposed a new licensing system for rental property owners that would require landlords to hold a licence before leasing a home, with repeat breaches of renters’ rights potentially leading to that licence being revoked.

Under the proposal, landlords who repeatedly fail to meet their legal obligations could face a “three strikes” process and ultimately lose the right to rent out property. The Greens say the policy is intended to improve compliance with minimum rental standards and strengthen protections for tenants.

The plan would also establish an independent regulator responsible for administering licences, maintaining a public register, carrying out inspections and enforcing rental standards. The Greens have proposed allocating around $50 million to establish and operate the regulator.

Properties could also be subject to independent checks confirming they are suitable to rent, while energy-efficiency information and compliance with minimum standards would become more prominent parts of the rental process.

Supporters argue that stronger enforcement is needed because minimum standards are only effective when tenants are able to have them enforced. Issues such as mould, inadequate heating or cooling, safety problems and delayed repairs are among the types of concerns the proposal is intended to address.

For landlords in Melbourne’s western growth corridor, the proposal could introduce additional compliance responsibilities if it were eventually adopted. Investors may need to maintain more detailed records, ensure properties consistently meet minimum standards and potentially undergo additional inspections.

That could increase the cost of owning and managing rental property, particularly for older homes requiring upgrades to meet current or future standards. Investors would need to account for these costs alongside mortgage repayments, land tax, insurance, maintenance and property management expenses.

Some property industry representatives have warned that additional regulation could discourage investment and reduce rental supply if landlords decide the compliance burden is too high. Others argue that stronger standards may improve the quality and stability of Victoria’s rental market.

For tenants, stronger enforcement could provide greater confidence that rental properties meet minimum safety and living standards. A licensing system could also make it easier for authorities to identify landlords with repeated compliance problems.

However, the effect on rents and rental supply would depend on how the scheme was designed and how investors responded. It cannot be assumed that additional compliance costs would automatically result in higher rents, because rental prices are ultimately influenced by local supply, demand and tenant affordability.

This is particularly relevant in Melbourne’s western growth corridor, where strong population growth has supported rental demand. If some investors reduced their exposure to the rental market, supply could tighten further. On the other hand, improved compliance may encourage more professionally managed and higher-quality rental properties.

The proposal also arrives as Victoria is already implementing new rental reforms. Changes that took effect on 13 October 2026 include stronger evidence requirements for bond claims, bans on rental application and payment fees, and expanded safety-check obligations for rental providers.

For investors, the broader direction of regulation means compliance is becoming an increasingly important part of property strategy. Rental yield alone may no longer be enough when assessing an investment; owners also need to consider the cost of meeting safety, energy-efficiency and tenancy requirements over the life of the property.

For Melbourne’s western growth corridor, the proposed licensing system could therefore have mixed effects. It may strengthen renter protections and improve property standards, while also increasing administrative and compliance responsibilities for landlords.

Importantly, the landlord licensing and three-strike system is currently a Victorian Greens policy proposal rather than an existing requirement for Victorian landlords. Whether it becomes law would depend on future political and legislative decisions.