New rules in relation to Covid…….July 2021 | ACOP
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New rules in relation to Covid…….July 2021

 

Covid

All of the following information is current as of 19 July 2021. For updated information, you should make sure you read the NSW Fair Trading website regularly about rules changing and also ensure that you are receiving the Property Matters newsletter.

Agents – keep doing what you’ve been doing.

  • All inspections must be individual – that is one agent and one person viewing the property. That does not mean one family, or one couple, or one group. It definitely means the one agent with one other person. If there is more than one person wishing to view the property, then it is simply one at a time.
  • Continue with all hygiene and social distancing measures whilst showing property to one person at a time.
  • All auctions must not have any persons present. This means that you will conduct these using platforms such as Zoom, or Teams or any of the commercially available auction platforms.

Agents in the Fairfield, Liverpool or Canterbury-Bankstown local government areas, you can only leave the local government area you live in to go to work if:

  • the business is allowed to be open and
  • you are an authorised worker.

This means that whilst you can continue to work in the local government area where you live, you are NOT permitted to leave your LGA to go to work.

Residential Tenancies

There is now a tenancy moratorium to restrict when landlords can evict tenants due to rental arrears (a 60 day freeze). Eligible COVID-impacted residential  tenants who cannot meet their rent payments will  be protected from eviction during the moratorium period commencing from 14 July and finishing at midnight on 11 September 2021.

A landlord or agent may continue to seek a termination in other circumstances including the sale of premises, illegal use of premises, damage to property, hardship or the end of fixed term agreement.

Eligible COVID-19 impacted tenants

To be eligible for the protection against eviction, a tenant needs to:

  1. show that rent paying members of the household are impacted by COVID-19 and have lost employment, work hours or income or have had to stop working because they or other members of their household (or in their care) were/are ill with COVID;
    AND
  2. show that the household’s take home weekly income has reduced by 25% or more (including any government assistance received) compared to the weekly income received in the 4 weeks prior to 26 June 2021;
    AND
  3. continue to pay at least 25% of the rent payable.

What happens after 11 September 2021?

If a tenant is behind in paying the rent due under the agreement, the landlord will be able to take termination action in accordance with the usual termination provisions in the Residential Tenancies Act. For this reason, the tenant should continue to pay as much rent as they are able to afford.

Landlords and tenants are encouraged to work together and negotiate rent reductions if a tenant is COVID-19 impacted and is unable to pay the full rent. A rent reduction agreement will vary the rent payable under the tenancy agreement, and if a tenant then pays the reduced rent they will not accrue arrears.

What happens where there are arrears owing from the previous moratorium period?

In March 2021, the Government put in place measures to assist COVID-19 impacted tenants who accrued rent arrears between 15 April 2020 and 26 March 2021 (the previous moratorium period). Under the current 60 day freeze on evictions, if a tenant is currently COVID-19 impacted, the landlord is unable to take action to terminate the tenancy for arrears accrued during the previous moratorium period until after 11 September 2021.

Financial support for landlords

The Residential Tenancy Support Payment provides up to $1500 per tenancy agreement. This grant will be available for landlords who agree to reduce the rent for COVID-19 impacted tenants from 14 July 2021. The rent reduction agreement can run longer than the 60-day moratorium period (i.e. beyond 11 September) if the tenant and landlord agree.

The amount for each landlord will be capped at the reduction that is passed onto the tenants, or $1500, whichever is the lower.

Landlords cannot ask tenants to repay the reduced amount of rent that has been paid to them under the Residential Tenancy Support Payment.

A landlord can claim either this payment or the COVID-19 land tax benefit (which is an offset of the land tax liability equal to the rent reduction granted), but not both.

For the purpose of a payment, Fair Trading will need to be satisfied there is a residential tenancy agreement in place such as a lodged rental bond and/or a written agreement.

So, what should agents and tenants be doing right now.

  1. Tenants should be contacting their agent/landlord to discuss options
  2. Tenants should gather their evidence of being an impacted tenant:
    – payslips or bank statement showing reduced income
    – documentation from an employer showing job termination/stand-down or reduced hours
    – evidence of a business closure or business records showing loss of takings
    – Centrelink confirmation of eligibility for financial assistance
    – medical certificates
  3. Prepare to put the agreement in writing

Tenants in commercial or retail premises

Protection will be offered for impacted tenants in commercial and retail tenancies in NSW. Landlords will not be able to lock out or evict impacted tenants without first going to mediation. To be eligible, tenants must have an annual turnover of $50 million or less AND be eligible for either the Micro-business COVID-19 Support Grant, the COVID-19 NSW Business Grant, or the JobSaver Scheme – all of which are detailed on the NSW Government website.

Landlords leasing commercial properties

For landlords with tenants in financial distress. Landlords with commercial properties may be eligible for a land tax concession if they provide rent reductions to their tenants. Landlords will receive payment up to 100% of 2021 land tax. To be eligible for this payment, landlords must provide at least that much rental relief to tenants who are eligible for the Micro-business COVID-19 Support Grant, the 2021 COVID-19 NSW Business Grant and/or the JobSaver scheme. This scheme is available for rent reductions made from now until 31 December 2021.

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