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Eviction moratoriums extended as COVID-19 lingers

Eviction moratoriums extended as COVID-19 lingers

Investors managing rental properties won’t be able to evict tenants after some state governments extended their moratoriums. 

A moratorium on evicting tenants impacted by the COVID-19 pandemic has been extended in New South Wales by another six months, Kevin Anderson said, the minister for better regulation.

“We know the pandemic has resulted in financial difficulty for so many people in NSW,” he said.

“As the impacts of COVID are ongoing, we intend to extend the measures until March next year which will allow more time to return to normal.”

The extension means landlords won’t be able to evict tenants who have fallen behind in rent because they have been impacted financially by the COVID-19 pandemic -- unless they have “attempted to negotiate a rent reduction in good faith”.

It also prohibits tenants from being listed on databases if they fall behind in rental payments, and extends a 90 day notice period for evictions instituted for other reasons.

“(These measures have) meant that many tenancies have been able to continue, keeping a roof over people’s heads and giving landlords the security of continued rental payments,” Mr Anderson said.

More than 5000 landlords, tenants and agents have enquired about the new policies with NSW Fair Trading since they were instituted on April 15. 

Rent relief practiced around the country

Most Australian states legally authorised the postponement of rent payments at the dawn of the COVID-19 pandemic earlier this year. Few states have chosen to extend them, while others are scheduled to expire in the near future. 

Victoria has extended its moratorium on evictions after a second wave of the pandemic led to a state of emergency and state of disaster being declared.

The moratorium was instituted on 29 March 2020 in Victoria and it will run for a year until 28 March 2021.

Victorian landlords are also required to discount rent for tenants impacted financially by COVID-19 and are to suspend rental increases.

South Australia and Western Australia have also extended their rent moratoriums to March 2021.

Queensland is not extending its eviction moratorium and it is scheduled to expire on 29 September 2020. However, there are some specific exceptions that will expire on 21 December 2020, such as allowing tenants to break tenancies quickly if they’re subject to domestic violence.

The ACT’s moratorium is currently scheduled to expire this year on 22 October, while Tasmania’s will elapse on 1 December. 

Landlords offer some relief but renters say it’s not enough

The financial fallout from the pandemic is affecting both landlords and renters, but the question remains whether the pain inflicted is being distributed evenly. 

Renters surveyed said they were generally not awarded adequate reductions, a claim widely disputed by landlords

About 9 per cent of renters confronted with a loss of income during COVID-19 were granted relief with an adequate discount, advocacy group Better Renting found, despite landlords having the option of deferring mortgage repayments.

“Most renters have no leverage in negotiating a rent reduction and are entirely dependent on the benevolence of their lessor,” the group said.

“Some renters began negotiations for a rent reduction only to be thwarted by an alienating process.”

Real estate agents take a percentage of paid rent, the report noted, creating “a disincentive to facilitate rent reductions”.

The Property Investment professionals of Australia (PIPA) cited their own research claiming 45 per cent of landlords provided rental relief to tenants who had suffered a loss of income from COVID-19.

PIPA did not quantify if this relief was in the form of a rent reduction or a deferral of payments, where the latter would require renters to back pay any outstanding rent.

Additional PIPA research found the majority of property investors managed to maintain their investments during the pandemic with little impact. About 92 per cent of them did not apply to defer their mortgage repayments and 75 per cent of them didn’t have to extend the term of their loans.

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This article was reviewed by Personal Finance Editor Georgia Brown before it was published as part of RateCity's Fact Check process.



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