The Victorian Government is extending eviction moratorium laws to provide greater certainty for both tenants and landlords.
Rental increases are also banned until the end of the year.
Extension of these laws will ensure that Victorian renters facing hardship due to the coronavirus (COVID-19) pandemic will not be evicted from their homes (with limited exceptions) or have their rent increased until 31 December 2020.
In addition to the eviction moratorium extension, further support being introduced for residential and commercial tenants and landlords includes:
- changes to the land tax relief scheme and an increase of land tax discount from the current 25 per cent to 50 per cent for residential landlords who provide a 50 per cent rent reduction to eligible tenants
- extension of the Rent Relief Grant program to 31 December 2020, increasing the maximum grant amount to $3,000 for new applications, and allowing previous recipients to receive up to an additional $1,000
- extension of the Residential Tenancies Dispute Resolution Scheme until 31 December 2020.
Treasurer Tim Pallas explained:
“Landlords that provide outright rent waivers of at least 50 per cent of rent payable for at least three months will be eligible for an additional 25 per cent land tax relief,”
“A $60 million fund additionally will be established for eligible small commercial landlords, and that will provide up to $3,000 per tenancy.”
“To get through this together, all of us - tenants, landlords, businesses, governments, banks - we need to work together.
And certainly these arrangements - which seek to strike that right balance - are aimed at ensuring that where the right thing is done by a landlord for a tenant, where they comply with the eligible criteria, then they too can expect that the state will provide them with relief as well.”
Pallas noted that in the last four months, around 26,000 agreements for reduced rent have been registered with Consumer Affairs Victoria, while the Victorian Small Business Commissions also facilitated around 8,000 rent-related inquiries.
“Nobody should be worried about losing a roof over their head right now - particularly given the circumstances around social distancing but also, the associated economic consequences of the pandemic event that the entire world is confronting,” Pallas said.
“So we need to provide certainty to people who lose their homes or their businesses, and we need to help tenants and landlords find some common ground.”
With Victoria in Stage 4 lockdown and many businesses closed commercial landlords will need to offer rent relief in line with business’ turnover.
Previously, there were no defined rules and that relationship between rent reductions and falls in turnover was just something the government hoped landlords would do.
“But we will now make it a very clear and expressed intention that, if you're identifying a downturn in your capacity, your turnover, then you should have an expectation that that is similarly reflected in terms of the rent relief that you get,” Pallas said.
Here's what's happened so far
In the past four months, close to 26,000 agreements for reduced rent have been registered with Consumer Affairs Victoria (CAV), with advice and dispute resolution services accessed more than 80,000 times.
Of these contacts, more than 90 per cent have found solutions through CAV’s ‘front door’ service, including more than 8,400 cases resolved through its Residential Tenancies Dispute Resolution Scheme.
These services will continue to remain in place, assisting more residential tenants and landlords who might be struggling to reach an agreement over rent reductions.
The Victorian Small Business Commission (VSBC) offers a similar service for commercial tenancies and has fielded more than 7,900 rent-related enquiries from small business owners and landlords.
Of the cases reaching mediation, more than 90 per cent have resulted in tenants and landlords reaching common ground.
Now is the time to take action and set yourself for the opportunities that will present themselves as the market moves on
If you're wondering what will happen to property in 2020–2021 you are not alone.
You can trust the team at Metropole to provide you with direction, guidance, and results.
In challenging times like we are currently experiencing you need an advisor who takes a holistic approach to your wealth creation and that's what you exactly what you get from the multi award-winning team at Metropole.
If you're looking at buying your next home or investment property here's 4 ways we can help you:
- Strategic property advice. - Allow us to build a Strategic Property Plan for you and your family. Planning is bringing the future into the present so you can do something about it now! This will give you direction, results, and more certainty. Click here to learn more
- Buyer's agency - As Australia's most trusted buyers’ agents we've been involved in over $3Billion worth of transactions creating wealth for our clients and we can do the same for you. Our on the ground teams in Melbourne, Sydney, and Brisbane bring you years of experience and perspective - that's something money just can't buy. We'll help you find your next home or an investment-grade property. Click here to learn how we can help you.
- Wealth Advisory - We can provide you with strategic tailored financial planning and wealth advice. Click here to learn more about we can help you.
- Property Management - Our stress free property management services help you maximise your property returns. Click here to find out why our clients enjoy a vacancy rate considerably below the market average, our tenants stay an average of 3 years and our properties lease 10 days faster than the market average.