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Pandemic rent reprieve proves divisive

17 November 2020 Grace Ormsby
Pandemic rent reprieve proves divisive

COVID-19 is pushing relationships between tenants and landlords “to the brink”, according to new research.

A new report, Post-Pandemic Landlord-Renter Relationships in Australia, from the Australian Housing and Urban Research Institute (AHURI) has flagged that the COVID-19 pandemic has “created significant tension in the landlord-tenant relationship”.

It revealed there are two clear groups of landlords: those who are willing to consider financial assistance for their tenants, and those who are unwilling or unable to offer such support.

The AHURI highlighted how only half of the tenants who had asked for rent reductions reported that the landlord or property agent had fully accepted their requests.

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It’s despite up to 60 per cent of tenants indicating they are experiencing or anticipating imminent issues with paying rent, with a quarter of tenants noting immediate problems meeting rent payments and 35 per cent of tenants holding concerns that they would not be able to pay full rent in the next few months.

Many of them consider JobKeeper and JobSeeker as “essential” in making ends meet, with the report’s lead author, Dr David Oswald, expressing a concern about these measures coming to an end.

He believes the pandemic has “amplified many weaknesses — such as affordability, rental security, overcrowding and homelessness — in the Australian housing system, and in particular, exacerbated many existing challenges in the rental sector”.

“With moratoriums on evictions, rent increases and mortgage deferrals all coming to an end, the issues uncovered by this research risk rapidly worsening,” Dr Oswald added.  

He commented that the research highlighted the critical role government financial support, primarily through JobSeeker and JobKeeper, has played, enabling many tenants to pay bills, cover the cost of rent and remain in their home.

“It was clear from our findings that without this government support, many tenants would be in a significantly worse position, including potentially homeless,” Dr Oswald said.

He noted that this concern is flowing through to the landlord side of the relationship, with both landlords and tenants reporting “confusion, stress and uncertainty about what would happen when government financial support packages end”.

While some landlords have experienced challenges from a loss of rental income, the AHURI has observed that most have been able “to manage the financial shortfall”.

On the other hand, tenants in financial hardship have reported going without meals, being unable to heat their homes and not being able to pay utility bills on time.

According to the study, the disparity between landlords and tenants is extending through to wellbeing: the perceived stress levels of tenants are “statistically significantly higher than those of landlords, due not only to financial stress and future uncertainty but also to living conditions”.

It revealed a number of tenants who have found themselves in financial stress have not felt comfortable enough to ask for a rent reprieve, fearing future repercussions such as poor references or property defects not being fixed.

Pandemic rent reprieve proves divisive
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