The continued restrictions spurs a moratorium ban by real estate agents

The Real Estate Institute of Victoria has slammed the Andrews’ Government’s decision to effectively keep the property market shut down for an uncertain period.

The continuation of the ban on inspections means that people who desperately need to buy or lease a property will have to make that decision ‘sight unseen’.

Before the introduction of Stage 4 restrictions, people could visit a property one-on-one with the agent.

Private inspections are done with all safety measures including requirements for surface cleaning, gloves, masks, and contact details and are 100% supervised.

REIV Members took these extensive precautions long before they were recommended by government including turning on lights and opening cupboards and internal doors prior to the inspection.

REIV CEO Mr Gil King explained:

“Private inspections are far safer than going to the supermarket. No one watches me there and wipes down the Corn Flakes packet that I pick up and then return to the shelf.”

“We have seen and continue to see illegal rent-strikes with no consequences. Until balance and commonsense is restored we will embark on a moratorium-strike. Let’s see how the system copes without our cooperation.”

“What we experienced was the classic example of ‘tick-box consultation’; that is where you put your case forward but are not really listened to, with government effectively ticking the box that required consultation.”

“This demagogue decision to extend the moratorium means that for a whole year, landlords will be dictated to as how much rent they can charge removing their right to make fundamental decisions about their own property.”

The REIV has criticised the lack of genuine consultation by government with business.

The initial “consultation” that the REIV were invited to amounted to a roundtable with over 35 industries, all at one time, meaning only a handful had an opportunity to put their case forward.

The REIV was stunned to be advised that it had been invited to the wrong meeting.

While the REIV had a separate briefing later and provided alternatives and solutions to ensure that people can buy, sell and lease safely, all these suggestions have been ignored.

The real estate sector has been delivered a ‘double-whammy’ with the extension of the rental moratorium for a further 6-months.

REIV President Ms Leah Calnan explained:

“We are talking about shelter and making the biggest financial commitment for your lifetime. The government is turning a blind eye to the significance of a property decision in people’s lives.”

“The delay in allowing private inspections means that many people will be unable to make the move they so desperately have to make or commit to a property without seeing it first. That is unacceptable.”

“It is the government’s responsibility to protect tenants and yet they have abdicated this responsibility and pushed it onto private citizens and created a system that does not work.”

“These decisions compound the financial stress on Victorians and the Victorian economy and do nothing to help those suffering during these difficult times.”

While this was not unexpected landlords have virtually no relief while tenants get substantial support.

With many reduced rental agreements due for re-negotiation this month, the REIV is advising its members to refuse to negotiate rent reductions, forcing every request into the dispute system, a system that has already failed to cope with the caseload.

A survey of property managers conducted by the REIV shows that about three quarters of reduced rent agreements have been achieved outside of the dispute system.

With a backlog of over 4,000 cases VCAT is not equipped to resolve disputes.

The lack of understanding by the Victorian government regarding the operations of the real estate sector is evidenced in almost every facet of the way which it has handled the restrictions and the moratorium.

In its efforts to protect the most vulnerable of tenants, the Andrews’ Government has not only caused them long-term harm but has also allowed many who are not suffering COVID-related financial stress to profit from the moratorium.

The REIV is calling on government to allow one-on-one private appointment inspections of property so that people can physically see the property before they commit to a huge investment.

Without inspections, buying and leasing cannot proceed, keeping many people out of appropriate shelter and pushing many vendors and investors to the brink.

Here's a real life example of the hardship caused...

The REIV gave an example typical of the large number of consumers impacted by the ban on inspections in the following excerpt from a message distressed buyer and potential seller.

On Thursday 23 July we bought a new family home.

We allowed 4 months for settlement - plenty of time (we thought).

Within 2 weeks we had appointed an agent and had a timeline for selling our current house e.g. a few trades required, moving out (we have young kids/baby so wanted it spotless), styled, photos and then ready for listing.

But stage 4 was announced and trades, styling, photos and private inspections (even for vacated properties) all banned.

We couldn’t list it.

We now hear these conditions will be extended.

Hence, we will NOT be able to settle on our new house, without selling our current house.

Yet didn’t Dan Andrews say he didn’t want people not to be able to settle?! We cannot have this situation cause default for the industry.

I’m sure we are just one of many many people in our situation, who for various reasons MUST sell (either they have bought already, have financial pressures etc.) Buyers will not buy a house simply from viewing online (well we can’t even get stylists or photos taken!).

We live in Albert Park and the old Victorian houses need inspecting (vs an off the plan apartment).

We are absolutely stuck and the financial uncertainty is killing us.

We either need the government to allow private inspections ASAP (particularly for vacated properties) to be permitted PLUS allow all the associated contractors to be Permitted (styling, photos) OR the government commit to providing free bridging finance to cover the gap in settlement dates caused by the lockdown?

At the same time we face this pressure, we also face work earnings pressure due to lockdowns, homeschooling and childcare juggles.

All out of our control.

Again, I apologise for reaching out unknown.

We are just struggling so much and feel there is no one to help fight our cause, or even provide financial compensation for this situation.

About Leanne Jopson Leanne is National Director of Property Management at Metropole and a Property Professional in every sense of the word. With 20 years' experience in real estate, Leanne brings a wealth of knowledge and experience to maximise returns and minimise stress for their clients.