COVID-19: How are the states and territories helping renters?

By Louise Baxter

The coronavirus pandemic is having an economic domino effect across Australian property markets, but in the limelight are commercial and residential landlords and tenants who are suffering financial hardship due to the virus.

On 29 March, the Federal Government announced that all states and territories had agreed to a six-month moratorium on evictions to protect tenants who are unable to pay the rent due to job losses.

The states and territories have since announced their own relief measures to help safeguard struggling renters, as well as landlords.

This will be in addition to other assistance provided by the Federal government, including the JobSeeker and JobKeeper allowance and the mandatory code of conduct for rent negotiations between commercial tenants and landlords.

Here’s a look at what each is doing to support both residential and commercial tenancies during the coronavirus crisis.

New South Wales

New South Wales has pledged a $440 million package for tenants and landlords who have taken a hit during the coronavirus pandemic.

Instead of cash payments or payments to tenants, landlords will receive a waiver on their land tax up to 25% if they reduce rent.

The package is expected to be divided down the middle, with $220 million each going to the residential and commercial sectors.

Eligible NSW commercial tenants significantly impacted by COVID-19 include, but are not limited to, shops, cafes, gyms, hairdressers, restaurants, offices, warehouses and industrial sites.

The government will enact a Code of Conduct, which will operate for a temporary period during the pandemic, including the following measures:

  • Landlords must negotiate rent relief agreements with tenants in financial distress due to COVID-19 by applying the leasing principles in the Code
  • A ban on the termination of a lease for non-payment of rent
  • A freeze in rent increases

The government’s opted for a framework rather than a direct cash injection to help tenants and landlords reach an agreement, work together and, where relevant, keep businesses afloat.

However, the NSW Tenants Union will receive $2.3 million to immediately provide resources to assist with answering tenant queries.

Victoria

On 15 April, Victorian Premier Daniel Andrews announced the largest rental relief package to date, pledging $500 million for virus-hit tenants and landlords across the residential and commercial sectors.

Struggling tenants that earn under $100,000 per year, have less than $5,000 in savings and are paying at least 30 per cent of their income in rent will be able to tap into a fund of $80 million.

Premier Andrews said eligible tenants must also have reached a “good faith negotiation” with their landlord before being able to access the fund.

The plan will see payments of $2000 made directly to landlords. The fund is expected to be available to around 40,000 tenants across the state.

The remaining $420 million in the rental relief package will go towards land tax relief for both commercial and residential landlords.

Victoria’s $500 million rent relief package is the biggest announced to date. Source: Supplied

Queensland

The Palaszczuk government has focused on an evictions freeze during the pandemic, with rental grants of up to $2000 available to eligible tenants as “a last resort”.

Tenants experiencing hardship can be eligible for up to four weeks’ rent, if they’re in need of support while they are waiting for federal government support to prevent homelessness.

A statewide ban on evictions includes a retrospective freeze as of Sunday 29 March, with landlords prohibited from evicting a tenant if their lease expires during the COVID-19 crisis.

This means that a property owner must offer an extension to the lease for at least a further six months unless the tenant chooses to end the lease because they can’t pay the rent, which will be allowed.

Queenslanders experiencing domestic and family violence situations will also be protected by legislation, which allows affected tenants to:

  • Access immediate support to end tenancies quickly
  • Change locks without seeking approval
  • Access bond
  • Separate from co-tenancies
The Queensland government’s response is focused on an evictions freeze and rental grants for tenants experiencing hardship. Source: Supplied

Western Australia

On 14 April, the WA government announced it would be introducing “urgent legislation” to implement a range of measures tenants and landlords of both commercial and residential tenancies, affected by the pandemic.

The Residential Tenancies (COVID-19 Response) Bill 2020 will implement:

  • a ban on rent increases during the emergency period
  • any fixed term tenancy agreement due to expire during the period will continue as a periodic agreement
  • relieving the obligation to conduct ordinary repairs if the reason they cannot do so is COVID-19 related financial hardship or a lawful restriction on movement
  • allowing a tenant to end a fixed term tenancy prior to its end date without incurring break lease fees (tenants will still be liable for damage and rent arrears)

The Commercial Tenancies (COVID-19 Response) Bill 2020 will introduce a moratorium on evictions for small commercial tenancies and a range of measures to support for tenants, including the introduction of a code of conduct for landlords and tenants.

Australian Capital Territory

The ACT Government has committed to implementing a six-month moratorium on evictions for virus-hit residential and commercial tenants, as agreed by all states and territories at National Cabinet.

The government is implementing a range of other measures to help tenants and landlords financially struck by COVID-19, including financial subsidies for landlords who help their tenants. These include:

  • Rent reduction rebate for landlords that reduce a tenant’s rent by at least 25 per cent for up to six months
  • Moratorium on evictions, blacklist preventions and temporary freeze of rental increases
  • Landlords and tenants may reach an agreement to delay rental payments if a tenant is not earning income. Any outstanding rent during this period will be a debt owed to the landlord, minus interest for the period of any moratorium.
The ACT government has implemented freezes and rental rebates as part of their measures. Source: Supplied

Northern Territory

The NT Government is working towards further legislative amendments to the Residential Tenancies Act, to bring it in line with national responses to COVID-19. The aim is to:

  • Create longer negotiation periods between tenants and landlords
  • Create fairer terms for new leases for demonstrated hardship due to COVID-19

South Australia

The SA parliament passed legislation this week in a bid to ensure the protection of residential landlords and tenants suffering financially because of COVID-19. The new laws include the following changes to private residential tenancies:

  • A short-term moratorium on rental evictions due to unpaid rent arising from severe rental distress as a result of COVID-19
  • A stop to any rent increases for the private market
  • Extension of a tenant’s ability to arrange for repairs to be carried out by agreement with the landlord
  • Provision for routine inspections to be conducted using technology, such as live video or face-time, unless there are exceptional circumstances to conduct an inspection in-person
  • The South Australian Civil and Administrative Tribunal will continue to be able to consider undue hardship to tenants or landlords
  • Tenants cannot be listed on a residential tenancies database in certain circumstances as a result of COVID-19.
  • General protection for tenants who breach their agreement as a result of complying with a direction under law relating to COVID-19

The above measures are expected to be in place for the duration of any emergency declaration made as a result of COVID-19.

South Australian tenants and landlords will be protected by legislative changes during the COVID-19 crisis period. Source: Supplied

Tasmania

On 3 April, the Tasmanian Government issued a Notice under Section 22 of the COVID-19 Disease (Emergency Provisions) Act 2020 (COVID-19 Act), banning evictions for at least the next 90 days.

The Notice protects residential tenants, particularly those who are experiencing hardship from a loss of income as a result of COVID-19.

There are a number of exemptions to the eviction ban including:

  • Unlawful use of a property as well as wilful damage and violence
  • Notices to vacate due to the sale of a property where that sale contract was signed before the notice was issued

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