Residential tenants in financial distress due to lockdown will be protected from eviction for the next three months; it will be more difficult for commercial landlords to end businesses’ leases; and some residents of government-owned properties will not need to pay rent this month.
These are some of the measures the ACT Government announced today to protect vulnerable tenants during a financially difficult time.
“Our first and foremost request is for landlords and tenants to work together, to recognise that this is challenging for everybody, and to seek to work cooperatively to get through this,” said Attorney-General Shane Rattenbury. “These declarations back up that request.”
Residential tenants
Under the residential tenancy COVID-19 emergency response declaration, the ACT Government has declared a 12-week moratorium on evictions of tenants who are in arrears because they have lost income or working hours because of the lockdown. Nor can people required to quarantine or self-isolate be evicted.
“We are looking to back up the public health order by protecting tenants from finding themselves suddenly homeless in a period in which they are not able to get themselves organised,” Mr Rattenbury said.
In some circumstances, landlords can still evict tenants.
“But unless there is a clear issue of tenants damaging property and the like, [landlords should] think carefully whether this is the right time to evict.”
Landlords will not lose out; there will be a catch-up period for tenants whose rent has been reduced or deferred. Moreover, residential landlords who offer rent relief of at least 25% will receive $100 credit on their residential land tax to match the reduction in rent. Last year’s land tax credit provided rental relief to almost 1,000 households – but this year’s 20% threshold is more generous, a government spokesperson said.
Tenants who can afford to pay should do so, Mr Rattenbury emphasised.
“This is not an invitation for a rental holiday,” he said. “For some landlords, that investment and that income are very important to them.”
However, Joel Dignam, executive director of Better Renting, said he was disappointed and underwhelmed.
“At a time when our entire community is dealing with the difficulty and stress of a twice-extended lockdown, this declaration is not worth much. Instead of offering protection to all renters against all evictions, it defines a narrow group of renters and protects them against only a narrow range of potential evictions.
“There are renting families out there in lockdown, dealing with the challenges of learning from home and the stress of the game-changing delta variant. Now they’ve got to live with the added worry that they could get a notice to vacate and be forced to leave their home in a matter of weeks.”
Tenants will not be immediately tossed out onto the street if they cannot afford to pay their rent, an ACT Government spokesperson said. Existing protections under the Residential Tenancies Act 1997are already quite robust.
A landlord cannot terminate a tenancy agreement without applying to the ACT Civil and Administrative Tribunal. Most termination grounds have a delay before they are affected. Even if the ACAT orders termination, it can suspend that termination order for three weeks if the tenant would suffer hardship.
LegalAid ACT also offers free advice for tenants.
Commercial and government tenants
Commercial landlords must engage in good faith negotiations with local business tenants hardest hit by COVID-19, Mr Rattenbury said; they cannot terminate leases or take action without first discussing lease arrangements. This measure has been backdated to 12 August, when the lockdown began.
“A tenancy cannot simply be ended,” Mr Rattenbury said.
The ACT Government will also fund professional mediation services between landlords and tenants.
Commercial landlords who offer rent relief or owner-operators may be eligible for a $5,000 commercial rates credit.
The ACT Government will waive rent payments for September for businesses and community sector tenants of government-owned properties whose August turnover has been reduced by at least 30%.
“The government wants to be a model landlord in these circumstances,” Mr Rattenbury said.
Local business leader John-Paul Romano, chairman of the Inner-South Canberra Business Council, wondered why it had taken the government three weeks into lockdown to implement these measures if they were identical to last year’s commercial tenancy agreement.
The delay is because many of last year’s measures were integrally linked with the Commonwealth JobKeeper scheme, an ACT government spokesperson explained; when that ended, the government had to develop new eligibility criteria.
“They were warned well in advance; it’s still not good enough,” Mr Romano said.
Brendan Smyth has been reinstated as local business commissioner to keep businesses informed about the declaration, financial assistance, and mental health support.
Graham Catt, CEO of the Canberra Business Chamber, said small businesses were relieved to see the ACT Government had released a code for commercial landlords and tenants.
“Rent is a major cost for many small businesses, so the code, along with relief for tenants and financial support for landlords, was an eagerly awaited next component of the supports being put in place for business.”
Mr Catt also welcomed the requirement that disputes between landlords and tenants must be referred to mediation.
“That will come as a relief for many businesses. They’ve lost their income. They’ve had to stand down their staff. In many cases, they can’t even access their premises. The last thing business owners need is more stress because they fear being evicted.
“The difficult reality is that in many cases, both tenants and landlords are in a much worse financial position than they were in the latter half of 2020. The level of Federal assistance is vastly different, and many landlords and tenants burned through cash to manage or just survive the pandemic this far. Many landlords will be very limited in the waivers and deferrals they’re able or willing to offer, and for many tenants, these will only make a very small minor – although certainly appreciated – difference to their financial position.”
