Greater Certainty Paves Way For Return To Rent Normality
Queensland’s residential tenancy eviction freeze will end on 29 September 2020 while commercial tenancies will have a moratorium on evictions extended until 31 December 2020, the State Government has announced.
Shortly after the onset of COVID-19, Prime Minister Scott Morrison announced a plan to implement a nation-wide freeze on residential tenancy evictions. Our State Government responded with an announcement that it would provide even greater protections including permanent rent decreases with no rental deferrals and no requirement for tenants to substantiate their request for rental reductions.
You will also recall the Real Estate Institute of Queensland (REIQ) launched its most powerful grassroots campaign for more fair and balanced COVID-19 special protections for both tenants and landlords. 400,000 plus letters of protest to all 93 MPs and it was over within a record 72 hours before the state government “conceded” and made the new Regulation which was largely consistent with other Australian jurisdictions.
REIQ chief executive officer Antonia Mercorella said the peak body was satisfied with the temporary framework which provided a more balanced approach for tenants and owners. “The previously proposed measures would have seriously harmed over 600,000 property owners who provide the vast majority of rental housing supply to 36% of Queensland’s population who rent,” explained Ms. Mercorella. “Furthermore, it would have had a devastating impact on the future of the property market and broader Queensland economy. We support the protection of tenants who are in financial distress due to this pandemic. However, the scope of the previously proposed measures were too broad in their application. In fact, they were the most onerous of their kind for property owners across all Australian jurisdictions.”
With a six month deadline attached to the moratorium on evictions, set to expire on 29 September, 2020, late last week the State Government announced that Queensland will be transitioning back towards normal residential tenancy arrangements. Those protections that will cease to apply after 29 September, 2020 include:
- Fixed term agreement extensions for COVID-19 impacted tenants;
- Ending agreement provisions that prevent property owners ending tenancies with COVID-19 impacted tenants without grounds and provide additional grounds for parties to end tenancies (owner occupation and sale of premises which require vacant possession);
- Adjusted rent and bond processes that support parties to negotiate arrangements to manage COVID-19 impacts on their tenancies; and,
- Mandatory conciliation of COVID-19 related tenancy disputes through the Residential Tenancies Authority (RTA).
It’s important to note that several critical protections will remain in place to protect tenants as households continue to recover from the global economic impacts of the virus. These include:
- Protections for tenants from being listed in a tenancy database for unpaid rent caused by COVID-19 impacts;
- Tenants experiencing domestic violence being able to end their interest in a tenancy agreement quickly;
- Limited reletting costs for tenants in extreme financial hardship who end their fixed lease early;
- Entry restrictions and requirements that support social distancing requirements; and,
- Relaxed repair and maintenance obligations that recognise impacts on lessors while maintaining tenant safety in the rental property.
“These remaining COVID-19 protections for property owners and tenants will remain in place until 31 December 2020,” explained Housing Minister Mick de Brenni. “The freeze on evictions was important in the residential sector when movement in Queensland was much more restricted. Because of our strong health response, we’ve been able to keep the economy more open and we’ve already started delivering Queensland’s plan for economic recovery. This includes supporting businesses because that means supporting jobs. As a result, we’ve seen Queensland’s economy fare better than other economies.”
The RTA’s latest COVID-19 conciliation data shows that tenants and property owners had worked together to resolve 1,677 disputes since April. The volume of calls to the RTA has significantly reduced since the start of the year. “Our free conciliation service will continue,” the Minister added. “We’ve seen 70% of all conciliated tenancy disputes successfully resolved within an average of just over eight days. I want to congratulate property owners, property managers and tenants for working together at what has been a difficult time for all Queenslanders.”
The COVID-19 Housing Security Sub Committee, established by the government to monitor and advise on temporary measures during the global pandemic and which includes the REIQ, will continue to observe impacts on the residential tenancies sector and recommend actions to support Queensland households as needed.
“The State Government’s decision not to extend the COVID-19 Emergency Response Regulations is a positive sign of just how far we’ve come in the fight against COVID-19. With such a strong health response, the State Government has been able to keep the economy open and start delivering its plan for economic recovery which has already seen over 74,000 new jobs created over June and July 2020,” further commented Ms. Mercorella. “A return to rent normality is a positive sign for Queensland’s property market and in particular property investors, many who have faced extremely tough financial difficulties. A return to rent normality is also a strong indicator that we’re starting to navigate through to the other side of this pandemic.
“What’s more, JobKeeper and JobSeeker payments will still provide tenants with the ability to cover rental expenses without accumulating any deferred debt which is a further positive outcome. Queensland still remains one of the most affordable places to rent with the current median rent only $360 for a three-bedroom home.”
Commercial Eviction Freeze Extended
Queensland’s moratorium on evictions for commercial leaseholders has been extended to 31 December, 2020. Attorney-General and Justice Minister Yvette D’Ath said the three-month extension is good news for struggling businesses.
“It means that to the end of 2020, commercial leaseholders under affected leases cannot have their lease terminated if they fall into arrears as a result of the coronavirus pandemic,” the Justice Minister said. “Since the moratorium was introduced in March, landlords and tenants have worked together in good faith to tackle the economic challenges we’re facing. This extension is about giving businesses and the thousands of workers they employ the certainty they need in these challenging times.”