Government says tenants don't have to pay rent if under hardship

Maybe Tennants should pay their rent.

If owner/invester is charitable. They can donate money to the local cat or dog shelter who are doing it touch at the moment or the tennant can forward receipts for mobile phone, fuel,nbn, Netflix etc and investor can reimburse their tennant. Me I like charities that allow a tax deduction but I Amy's greedy property investor but ymmv

 

NSW policy on rental just announced

The NSW government has introduced a $440m rent relief package along with measures to support landlords and tenants during the Covid-19 pandemic.

NSW commercial and residential tenants significantly impacted by Covid-19 will have greater protection from eviction as the state government puts $440m towards rent relief in the form of land tax waivers or rebates.

The government’s six-month support package will include a moratorium on applications for forced residential evictions due to rental arrears for households financially disadvantaged by the pandemic.

Residential landlords and tenants will be required to negotiate rental payments in good faith in circumstances where a household has lost at least 25% of its income because of the coronavirus.

Eligible tenants will be protected from eviction until the National Civil and Administrative Tribunal is satisfied negotiations have concluded, with any unpaid rent to accrue as arrears in that time.

 

A bit of reasonableness shown here however it raises the question of where we now sit if LL's allow a non-paying tenant to remain in the premises, racks up 6-7 months of accrued rent debt then vacates. Will LL insurance bear the arrears considering it is a state govt directive?

 

No easy solution to partially compensate landlords if they help tenant (reducing rent, giving rent freeze) if no agreement from the National Cabinet. Income tax is federal gov. Land tax is state gov. Rates is local councils. Too many layers.
And insurers have not been asked to coorperate.

 

Personally, I believe the best policy should be to allow tenants that have been financially impacted from Covid 19 to break lease with no penalty. Allowing them to stay on, on reduced rental payments is only delaying the inevitable. Sure, some will bounce back, but will have a debt to repay. Others may not get another job for a couple of years.

The rental market will do what it does best (when the Government doesn't interfere). Properties with higher rents will be less attractive, so some will either have to drop their rents or sit vacant, and lower priced properties will become a lot more popular.

 

If they don't have savings or investments to sell. Maybe they can see a financial planner to curb spending habits and if needed to provide for family withdraw some super. When things improve replace it with salary sacrifice deposits.

 

Brace for a lot of phone calls tomorrow. Some people are legit some are opportunistic.

 

Social distancing and isolation is about risk mitigation and elimination of COVID-19. The act of allowing individuals and families to visit replacement rentals involving agents and removalists in order to move on without penalty increases risk of community transmission. Logistically such a policy would go directly against all of the advice given.

Until there is a relaxation of the current public directives and the infrastructure to deal with the effects of community transmission are in place (e.g. trace and monitor) , all policy decisions will have first and foremost, social distancing and isolation in mind as a Health matter. Other concerns, whilst considered, are secondary. There have been too many instances of people not doing the right thing e.g. self-isolating when sick and sadly, this will affect the majority who are doing it right.

Why the need for additional legislation preventing tenants that have been financially impacted from Covid 19 to break lease with no penalty? To waive lease fees is always surely at the discretion of the landlord and property mangers?

 

And yet, one of the permitted reasons for leaving your home is to MOVE HOUSE. Even in the article on what's permitted over Easter, the question was asked as to if you could temporarily move in with a partner/family member & there was a green light.

Keeping a tenant in a property they can no longer afford does not suddenly make them able to afford it. Not everyone will get their jobs back. Some will be paid more, some will be paid less. Whether its done now or later, at some stage, tenants will have to live somewhere they can afford, and for some, delaying the inevitable will only cause more pain.

Teach people to learn to live with their new reality, they can always upscale again at a later time without causing potential harm to another. Sadly there will be no coming back from this for some.

 

It sounds like a time to be keeping down with the Jones's

 

Absolutely!

The other very large issue that I see on the horizen is the covid supplement that has been added to centrelink benefits. While I can understand why it's been done, there's going to be a lot of problems when this is taken away. Once they've been accustomed to getting this larger payment, how will they re-adjust back down again?

 

Move in with the tenants? On a rotational basis if multiple IPs are involved unless they are not interstate.

 

LOL!

 

This will mean a slower recovery.

 

Even slower if they have caught Covid-19

 

Exactly, Simon - rents are set by the capacity of tenants to pay which in turn is determined by how much they earn. At the moment there's 2 million or so (?) extra welfare recipients and the "double dole" supplement hasn't even started yet... there has to be some ultimate flow-through to the rest of the economy in terms of consumption and rents.

It's interesting to contemplate when this will all return to some semblance of 'normal' - and maybe that won't be as good as before?

 

I'm not sure there's much of an advantage. The maximum allowable by law is a month in Queensland (for a fixed term agreement). Penalty if discovered is $2,669.

If you use a PM, they won't release
it other than periodically, eg two weeks at a time, from their Trust account, as they don't want to incur this penalty.

See s87

 

It's not on a fixed term agreement.

 

Then it's a maximum of two weeks.