A guide to coronavirus tenancy problems

Discussion in 'Property Management' started by geoffw, 6th Apr, 2020.

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  1. geoffw

    geoffw Moderator Staff Member

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    This advice from Metropole Properties had some good advice on what to do. Of interest is the advice to wait until individual states give details (only Queensland has done so at this stage). The advice given here is that offering to reduce rent too early may jeopardise government help and landlords insurance claims - before then, put a payment plan in place.

    A landlord’s guide to Coronavirus tenancy problems.
     
    Last edited: 6th Apr, 2020
  2. # 1

    # 1 Well-Known Member

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    Correct link here, no Google AMP

    A landlord’s guide to Coronavirus tenancy problems.


     
  3. geoffw

    geoffw Moderator Staff Member

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  4. GreenGoblin

    GreenGoblin Well-Known Member

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    Thanks for the link. From my interpretation of the article, though, even Metropole are unclear of the best approach.
    Metropole's website states:

    Q: Should I agree to reducing the tenant’s rent?
    ... our recommendation is not to offer reducing or forgoing rent until the government releases details of its rental relief packages.
    ...
    Reducing rent, putting rent on hold or not issuing late notices will jeopardise a landlord’s ability to claim on their landlord insurance, and may potentially risk any benefits announced as part of the government relief packages.

    Yet they then write:
    Until details of the tenant and landlord relief packages are made available, our advice is for landlords to put a payment plan in place for any tenants who are genuinely suffering financial difficulties.

    For example, you could offer them an arrangement where they pay less rent (maybe half) for the next few months, but agree to catch up their rental payments through increased rental in 3 or 4 months once they secure employment.

    This arrangement to pay less rent for a period of the tenancy seems to directly contradict the earlier advice to not reduce rent or put rent on hold. What am I misinterpreting in their advice?
     
  5. geoffw

    geoffw Moderator Staff Member

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    I think there will be cases where a tenant is just not in a position to pay the full rent, and something must be worked out.

    Reducing the rent is a permanent solution. Putting the rent on hold means (I think) the tenant not paying any rent at all for the time being - whereas this advice means the tenant not paying some of their rent for now. But I don't know if this advice is acceptable to the insurer. If landlord has landlord insurance, they should be consulting with the insuring firm as to the best course of action - a solution which is mutually acceptable. Ideally, the landlord should be waiting for government advice, but this seems to be slow in forthcoming. I wouldn't bank on getting too much help from the government though - possibly just some sort of tax relief.

    Possibly late notices could be issued, but with the knowledge that action will be taken once further information is available.
     
  6. abc_123

    abc_123 Well-Known Member

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    With the qld rent relief scheme, I noticed that there didn't seem to be any reason for either tenant or landlord to try too hard to negotiate anything. eg If landlord agreed to deferred rent, tenant would still have to pay it, landlord would take the risk that the rent was never repaid. So better to just not agree and claim on the scheme?

    Now I am hearing that tenants who enquire about the rent relief are being told that their negotiations with the landlord include that the landlord prove hardship if they do not pay their rent.

    Yet tenant can have up to $10,000 in cash to apply for rent relief and no requirement that they actually lost their job (just that they applied for centrelink if they did). Tenant does not have to prove hardship to be exempt from eviction.

    Sounds like a terrible double standard if true.
     
  7. Antoni0

    Antoni0 Well-Known Member

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    I've been told this by one of my tenants that applied for the rent assistance grant, they were asked "Have you exhausted all other avenues for finance?" and yes one of the other questions were "had you renegotiated rent with your landlord ?". They've been now referred to the RTA for the second stage of the vetting which I haven't heard of the outcome yet.
     
    Last edited by a moderator: 7th Apr, 2020
    Tom Rivera likes this.
  8. Tom Rivera

    Tom Rivera Property Manager Business Member

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    The stupid RTA grant says you have to have exhausted all avenues to negotiate with your Agent/Landlord and be at risk of eviction before you qualify.

    Well, we can't evict anyone, so how is that supposed to work?

    I've got a few tenants applying for the grant and I've had to provide them with a letter explaining that my clients are not willing to provide a rent abatement, nor do they believe that the tenants payments plans are acceptable (genuinely- these people have NO income right now). Hopefully that's all they want...!