The rental moratorium announced back in April this year was both a relief and a challenge for many tenants and landlords. Every state created its own rules and timeline for the rent relief period, and there have been several extensions and changes since it was first introduced.
Aussie families are said to struggle, with Queensland being the first to feel the pinch. Hosting 9/10 of the highest ranking cities across the country to have the most deferred loans.
Below is a list of the latest deadlines for the end of the rental moratorium in each state (Dates accurate as of the 10th October 2020):
- NT: No Moratorium in place - only support for commercial tenancies as per the Federal Government advice
- QLD: 29th September 2020
- ACT: 22nd October 2020 - with an additional grace period to 31st January 2021 for tenants to pay back their rental payments now in arrears
- TAS: 1st December 2020
- NSW: 26th March 2021
- VIC: 28th March 2021
- WA: 28th March 2021
The extension for these rental moratoriums will continue to apply pressure to landlords who have tenants who cannot pay the rent, and who cannot be moved from the property.
The key challenge for many at the moment will be balancing the drop in rental payments and their other income with their mortgages. The timing couldn’t be worse for those who applied for loan deferrals in April. The 6-month loan deferral period is nearly up, and from the 28th of September 2020 changes to JobSeeker and JobKeeper payments will also affect the income of many landlords.
At least 450,000 Australians have applied for loan deferrals since April this year, and they will all be receiving a call soon from their lender to discuss the next steps.
Some Light At The End Of The Tunnel
Fortunately, the Australian Banking Association is introducing a new plan to assist landlords who are still struggling. Each mortgagee will be assessed based on their current financial situation, and be allocated into one of 3 stages.
Stage 1 means that they are financially stable, and will need to re-start paying back their loan.
Stage 2 may still be experiencing some financial difficulty, but have some ability to make repayments. In this case, the lender may be able to assist by restructuring the loan so that the landlord can make partial payments for a temporary period, for example, an interest-only loan.
Stage 3 will be for those that still can’t make any repayments, and their lender will need to assist them to find a suitable solution. There may be an additional 4-month extension to the deferment period for those that qualify.
On the other hand, this hasn’t been an easy time for many tenants either. The extension in many states will hopefully give some tenants some breathing space if they are in a difficult situation with their landlord. The new JobMaker Program which has started this month may also provide tenants with greater opportunities to find employment as businesses will be incentivised by the government to hire new workers.
For tenants with a solid rental history, this may be the time to restart discussions with landlords around their financial situation and create a plan for the coming months. This may include offering partial payments where possible or renegotiating other terms of the lease. For landlords, this may be a suitable time to look for further cost savings on their property, including the option of switching to a private rental agreement to save on ongoing agent fees.
What Else Can Property Owners Do From Their Phone?:
FREE D.I.Y. Property Listing Hacks
This is one of the most expensive services when engaging a property manager. You can easily spend thousands of dollars upfront for advertising, with no guarantee of a lead.
On average, listing a rental for the first time can cost up to $828.45 following traditional methods.
Alternatively, DIY online methods come in at $0 upfront to have the property listed and online.
Equifax (veda) Tenancy Background Check
Tenant application received, now what?
Equifax (formally known as veda) has an online tenancy check option for landlords who would like to get that extra piece of security before letting their valuable asset.
The tenancy check gives full rental history of the tenant and a score of the tenants likeliness to pay rent on time.
Automated Rent Collection with Regular Reminders and Notices
The savviest function of the decade for long term property investors. Automatic weekly direct debit or credit card payments, with reminders sent on the landlord behalf for late rent.
There are many different ways to set this cool feature up yourself without an agent whether it’s through a mainstream bank or an online app.
Communicating with Tenants
During covid lock-down, we all remember Aussie prime minister Scott Morrison announcing that landlords and tenants need to work together to come to mutual agreements.
Shortly after, there had been many success stories leak that the happiest tenants and landlords had one thing in common. Good rapport.
Best Property Management Apps
For an all in one landlord directly to tenant, Instarent is hard to miss. Being Australia’s first and longest running, the easy to use app boasts all the functions one would expect from a DIY property management app.
Brickend app has also become a popular choice for entities to run their own books on property management.