Tenant relief as ban on evictions announced

Prime Minister Scott Morrison announced yesterday that all Australian states and territories will put a six-month moratorium (ie. temporary ban) on evictions for both residential and commercial tenants during the COVID-19 pandemic.

“States and territories will be moving to put a moratorium on evictions of persons as a result of financial distress if they are unable to meet their commitments,” he said.

“So there will be a moratorium on evictions for the next 6 months under those rental arrangements.”

This will come as relief for struggling tenants across the country as they will still have a roof over their heads – but it does not mean they will see any reduction in their rental payments. Currently, this is only happening on case-by-case agreements between tenants and landlords, although most landlords are warning that they can only take lower rents and restrictions for so long before they themselves get into financial trouble.

“We need you to sit down…and work this out”

The Prime Minister’s residing message for both commercial and residential landlords and tenants, is to work together to try to come to an arrangement to get them through for the next six months.

“Now there is a lot more work to be done here and my message to tenants, particularly commercial tenants and commercial landlords is a very straight forward one: we need you to sit down, talk to each other and work this out,” he said. 

“[we need you to sit down] so on the other side the landlord has a tenant, which is a business that can pay rent, and the business is a business that can re-emerge on the other side of this and be able to go on and employ people on the other side of these arrangements.”

Mr Morrison encouraged landlords to seek the help of the banks, and added further discussions and help will be on the way.

“We will be working on measures that will be encouraging you to do just that and to support you to do just that, but also to ensure that if you aren’t going to engage in that sort of co-operative activity, between banks, between tenants and between landlords, then the sort of support that you might otherwise expect to receive, you will not receive. This is part of the hibernation approach,” he said. 

What else is the government doing to help tenants and landlords?

The Australian Government has announced several different plans to help out struggling tenants and landlords alike. This includes everything from record low interest rates (0.25%) making it easier for landlords to service their mortgage debt, to two major stimulus packages with a combined value of $189 billion. The package mainly targets low-income earners and business, with measures including one-off $750 payments and a COVID-19 supplement for eligible welfare recipients; while some workers who find themselves without a job will be able to access jobseeker payments. Meantime, small businesses will be able to access wage subsidies of up to $100,000, which will hopefully help some keep their employees.

Read more of PropertyMash’s COVID-19 coverage here.

Written: 2 April 2020, Updated: 7 April 2020

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