Prime Minister's announcement re: evictions

Discussion in 'Property Management' started by Lil Skater, 29th Mar, 2020.

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  1. Lil Skater

    Lil Skater Well-Known Member

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    Usually, yes. But there are ways around this if you can prove hardship.

    There’s been heaps of info on this and banks are publicly saying there’s an option to defer the mortgage for up to 6 months. Speak with your broker/lender if needed.

    Wait for the state based info to come out, it may differ (and may differ anyway for residential - this is just the prelim information that has been received). Thus far in Victoria there’s no talk about removing notices to vacate for other reasons.

    No, if you have a residential agreement (written or verbal), even if they stop paying rent they are not squatters and you need to follow the process.
     
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  2. Simon Hampel

    Simon Hampel Founder Staff Member

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    Indeed, it sounds like the existing processes may still apply - at least in NSW - the implication being that "no grounds" or "failure to pay" evictions may be banned, but other forms of legitimate eviction may not.

    Live: NSW Now: Lucky escape after car flips, concerns over COVID-19 rental loophole

    Calls to close COVID-19 homelessness loopholes

    There have been calls to extend the rental moratorium in NSW, in order to close loopholes that could leave renters who have lost their jobs due to coronavirus-related closures homeless.

    Ms Berejiklian indicated she would roll out the new rules in the state, which ban landlords from evicting tenants if they experience rental distress from COVID-19-related loss of income.

    Leo Patterson-Ross from the Tenants' Union of New South Wales says officials must make sure "no-grounds" evictions and end-of-lease are not being used to circumvent the ban.

    "We do need the State Government now to make sure that when they implement the specifics of the announcement, they make sure that this does apply to all tenancies, because there is no distinction able to be made in our Residential Tenancies Act," he said.
    We have to wait and see what the actual legislation says.
     
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  3. Tim86

    Tim86 Well-Known Member

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    Such a horrible policy. A tenant should be required to still pay rent, the government should just make loans available to them through centrelink to do this.

    A landlord doesn't have a money tree. There are landlords who have lost their job, and are now being told to foot the bill for their tenants.

    Tenants will still be evicted if they don't pay their rent. Because the landlord won't be able to cover insurance, rates, maintenance, etc... without any rent income (even without having to pay mortgage for 3 months) so the landlord will have to sell and the new owners probably won't want those tenants living in their house.

    This policy is going to be the nail in the coffin for so many property investors.
     
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  4. MTR

    MTR Well-Known Member

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    US did similar but only till 15 April, 2 months eviction and foreclosure ban. Which in effect you dont have to pay county taxes during this time

    they also need to provide verification to PM

    there is also a safety net in US where anyone who lost their job will receive equivalent in government payments for 4 months

    what is this PM thinking? This is going to hurt many investors in Oz for sure
     
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  5. ttn

    ttn Well-Known Member

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    Scomo thinks that tenants and landlords can sit down and take the win-win deals just like people dont buy all the toilet papers and other stuffs ;)
     
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  6. Whitecat

    Whitecat Well-Known Member

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    and reduce values. there are going to be some bargains as investors get out. but yes for me personally this current situation sees me possibly providing free rent to tenants if they play hardball and paying rent myself. PM announcement seems one sided. Govt should reimburse investors or subsidise tenants idk.
     
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  7. MTR

    MTR Well-Known Member

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    I bags 6 months free rent;)
     
  8. MTR

    MTR Well-Known Member

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    But who is going to buy a bargain with this rent free scenario in place..... not me

    Also re work the rental yields allowing for south ward trend

    i think in the current environment wont be about buying but preserving capital

    We have huge debt in Oz and its now going to bite big time
     
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  9. Whitecat

    Whitecat Well-Known Member

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    what do you mean 'rework the rental yields' ? Do you mean that have to factor in decreasing rents for quite a long time?
     
  10. MTR

    MTR Well-Known Member

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    yes i do

    this ***** is going to create a mess

    tenants are already negotiating a reduction of rents. Yes they watch the media

    many losing jobs etc its current environment

    some will move home

    More supply coming to market. This is only the beginning

    i certainly would not consider buying atm we have a long way to go
     
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  11. Peter_Tersteeg

    Peter_Tersteeg Mortgage Broker Business Member

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    This really isn't as bad as it looks. The key is having a good PM who can communicate effectively with the tenants.

    If a tenant is in financial hardship, they should be applying to Centrelink. Part of that package includes rent assistance so you should receive something moving forwards.

    If they're not in hardship, you may still be able to evict them. We'll have to see what the state governments roll out over the next few days.

    Centrelink doesn't pay all the rent and a lot of tenants won't be able to make up the difference. The landlord will be out of pocket. They will go into arrears. When they're employed again, they can start to make it up with an arrangement. A lot of tenants will simply move house figuring they'll leave the problem behind.

    At that point the landlord can claim their bond which might go a long way to making up the difference. If there's still a substantial amount owing, the tenant will be blacklisted and there may be grounds to refer the matter to a debt collector. This would leave a nasty entry on their credit report.

    Moving forward landlords should be carefully questioning past landlords and PMs for references. Also check tenancy blacklists and even ask for credit reports.

    The need for a good PM is to ensure that the tenants understand all this and are aware that this isn't a free ride for 6 months. They need to do their part and work with the landlord to meet their commitments. There are significant consequences for them in the long term if they don't.


    One of the key things is don't reduce the rent. This reduces the assistance from Centrelink, it reduces what you can potentially claim later. It damages the market. Landlords only loose by reducing the rent.


    In the meantime if you're not getting rent and are in hardship yourself, you can apply for a repayment holiday with your lender. You should only do this if necessary because the capitalising interest will only cost you more in the long run.
     
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  12. Acidaus

    Acidaus Member

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    It looks like landlords have no choice - either reduce rent or they walk to one of the many vacant airbnb furnished rentals just waiting to give people a bargain. With lockdown we face potentially having no tenant for 6-12 months and having to get someone in at a greatly reduced price anyway. It seems the best strategy right now is to keep existing tenant at all costs and then re-assess every 4 weeks
     
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  13. abc_123

    abc_123 Well-Known Member

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    But wouldn't this be a civil matter (closing the electricity account if it was in your name for example) not criminal? If the tenant is saying I am not paying so sue me good luck with that, two can play that game. Landlord would just counterclaim for unpaid rent anyway.
     
  14. Whitecat

    Whitecat Well-Known Member

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    i wasnt planning on buying this week. But there will be a time when green shoots start and there are simultaneously massive bargains still around
     
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  15. abc_123

    abc_123 Well-Known Member

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    This is true but likewise if we live in fear of them now they can't be evicted for any reason at all (if we follow Tasmania), where does it end. Does tenant demand new swimming pool or else.
     
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  16. thesuperman

    thesuperman Well-Known Member

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    This would only work if they are locked into a lease for the next 6+ months. If their lease expired and now is on a periodical lease, they can just give 21 days notice to vacate and find a cheaper rental if you aren't willing to reduce a little bit.
     
  17. Whitecat

    Whitecat Well-Known Member

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    good post Peter. But what are the chances of arrears being paid in the future? e.g. do you think govts will be tough and enforce repayment or will tenants with those debts receive a lot of sympathy due to the debts arising during the pandemic?
    The bond is only 4 weeks. Tenants could cease rent for months.
     
  18. Patrico1966

    Patrico1966 Well-Known Member

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    Greens party were the first to push for this and in Tasmania, so this will be the lead for all other states. Tasmania has not put off many workers as other states so the damage wont be as bad as Sydney for e.g basically due to not that much work in Tassie and a large portion of people on the dole and ever increasing. The other point is there is high yield here due to much lower house prices. You do the math, buy a house here for $200k and rent it for $240 a week, if you have to drop your rent by 30% you should still be ok.
     
  19. kierank

    kierank Well-Known Member

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    We all laughed at the idiots/bogans panicking and rushing out to buy years and years supply of toilet paper.

    After reading this thread, I am starting to wonder how many PC members were in the above group.

    I have been through a number of really bad situations in my life, both health and financial.

    Two things I have learnt from those experiences:
    1. Don’t jump at shadows. It is not good for one’s mental health and one is likely to make a rash decision which one will regret later.
    2. One will most likely fall into the “valley of despair”. Recognise when this happens. The good news is there is only one way to go and that is up. The sooner one works out how to do that the better.
    Stay strong and stay well. Your country needs you. Get inspiration from previous generations who had it a lot, lot tougher than us.
     
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  20. thatbum

    thatbum Well-Known Member

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    According to who? It's pretty rare for that to be the case if you live with the person you rent to.
     
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