Powered by MOMENTUM MEDIA
realestatebusiness logo

Breaking news and updates daily. Subscribe to our Newsletter!

Home of the REB Top 100 Agents
Breaking news and updates daily. Subscribe to our newsletter

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.

Will the NSW government’s $5bn economic package protect real estate?

By Bianca Dabu
14 July 2021 | 1 minute read
economic package protect real estate

As New South Wales continues to battle an increasing number of COVID-19 Delta strain infections, the state government has announced a $5.1 billion comprehensive economic support package covering renters, landlords, businesses and households.

Among the key components of the 2021 COVID-19 support package are the business grants program, payroll tax waivers, grants for residential landlords, land tax relief, eviction moratorium, support packages for the performing arts and accommodation sectors, and funding to support mental health.

NSW Premier Gladys Berejiklian said the comprehensive support package aims to protect businesses, save and keep jobs through the lockdown and ensure that people had support amid an uncertain and difficult time.

Advertisement
Advertisement

“We have always said we will do whatever it takes to protect the people of NSW and keep our economy strong, and that is exactly what we are doing,” Ms Berejiklian said.

“While our health and medical staff are fighting COVID-19 on the frontline, this comprehensive support package is aimed at saving jobs and protecting businesses until the lockdown is over.”

In addition, the “mighty package” ultimately aims to ensure that the NSW economy “bends in the storm but doesn’t snap”, according to treasurer Dominic Perrottet.

“We will come out the other side with a few scrapes but more determined than ever,” he said.

Find out more about the support measures from the state and federal governments amid the ongoing COVID-19 lockdown:

Renters and landlords

Following the announcement of the 60-day moratorium on evictions to protect “impacted renters” — that is, residential tenants who have suffered loss of income of 25 per cent and have fallen into arrears due to COVID-19 — the New South Wales government revealed an additional $210 million in grants targeted to eligible landlords across the state.

Under the support program, landlords who decrease rent for impacted tenants can apply for a grant of up to $1,500 or land tax reductions, depending on their circumstances. The land tax relief, available to commercial, retail and residential landlords, shall be equal to the value of rent reductions.

According to Minister for Better Regulation Kevin Anderson, the support package will provide immediate assistance to renters and landlords amid the ongoing lockdown, ensuring a roof over tenants’ heads as well as rental income for landlords.

:Different head of customer experience Shannyn Laird has lauded the government’s action in providing much-needed assistance to NSW renters and landlords.

According to her, the support schemes will ultimately help parties to easily arrive at an amicable agreement amid the current COVID-19 conditions.

“The reality of the situation is that, unfortunately, this is not the first time we’ve been placed in lockdown, so it’s not such a shock to ask for a reduction or rent freeze this time around. We’re seeing renters and owners moving faster and be more transparent and reasonable with their asks — both in what owners can grant renters, and what renters are asking for from their property owner,” Ms Laird said.

The Tenants’ Union of New South Wales has also welcomed the announcement, but expressed concern about possible “loopholes” on the measures as well as the longer-term effects of the lockdown on renters.

“The stop on evictions for impacted renters gives those struggling with rent as a result of the lockdown greater certainty about their living situation and their ability to stay home. We are concerned, however, about renters who might otherwise already be facing eviction — those facing eviction for ‘no grounds’ including end of fixed terms, or for other reasons. This is a bad time for people forced to move to be trying to find a new home, and undoes the strong government messaging to stay home,” Tenants’ Union CEO Leo Patterson Ross said.

“We are also worried about what happens after the 60-day stop, even if the lockdown has been lifted. We know from experience that the impact of lost income on households is often prolonged and felt over the longer term.

“Impacted households will need time and support to get back on their feet.”

Businesses and households

Under the combined support package COVID-19 Disaster Payment, the federal and state government have committed support to affected businesses and residents, with around 50,000 small and medium businesses in NSW expected to be eligible for support payments of up to $10,000 per week.

The support, which will also be offered to any other state or territory that experiences an extended lockdown, will apply to entities with an annual turnover of between $75,000 and $50 million who can demonstrate a 30 per cent decline in turnover. For non-employing businesses, such as sole traders, the payment will be set at $1,000 per week.

This comes after the announcement of a business grants program two weeks ago, which provides $7,500 to $15,000 to eligible businesses with annual wages of up to $10 million.

A new grant program has also been introduced for smaller micro-businesses with turnover between $30,000 and $75,000 which experience a decline of 30 per cent. Eligible businesses will receive $1,500 payment per fortnight of restrictions.

Businesses with wages between $1.2 million and $10 million who have experienced a 30 per cent decline in turnover will also benefit from a 25 per cent payroll tax waiver.

For NSW workers, the COVID-19 Disaster Payment will grant $600 per person from week four of lockdown should the worker lose 20 or more hours of work a week. Workers who have lost between eight and less than 20 hours of weekly work are eligible for $375 payment.

The federal and state government have also committed to deliver a $17.35 million mental health support package for NSW, including for services through Lifeline, headspace and Kids Helpline.

The Property Council of Australia welcomed the “sensible and proportionate measures” announced by the NSW government, touting the importance of including commercial property owners in support measures aimed at safeguarding the local economy amid lockdown.

According to PCA acting NSW executive director Lauren Conceicao, property owners have provided more than $15 billion of support to tenants around the country during 2020 and 2021, and are once again stepping up to support many small hard-hit business tenants.

“As they did so effectively last year, property owners are again engaging closely with their small-business tenants experiencing hardship in the current lockdown and are providing support on a case-by-case basis,” Ms Conceicao said.

“This important case-by-case support for hard-hit small-business tenants will sit alongside the substantial government support announced today.

“The property industry continues to make community safety our highest priority during the pandemic, ensuring shopping centres, construction sites, retirement communities, and logistics hubs and warehouses have been able to stay open while being COVID-safe.”

Looking ahead, the executive director said the Property Council aims to continue its successful partnership with the government on CBD reactivation initiatives “to support our business hubs and lead the way out of these lockdowns, and we look forward to the implementation of this work post-lockdown”.

Will the NSW government’s $5bn economic package protect real estate?
Sydney during lockdown reb
lawyersweekly logo

Tags:

ABOUT THE AUTHOR


 

Do you have an industry update?

top suburbs

12 month growth
Warren
49.59%
Mullumbimby
49.48%
Waverton
49.18%
Blairgowrie
48.97%
Porepunkah
48.95%
Streaky Bay
48.89%
Bruce
48.67%
Koolewong
48.46%
Failford
48.4%
Victory Heights
48.22%
SEE AREA REPORTS ON SMART PROPERTY INVESTMENT WEBSITE
Subscribe to Newsletter

Ensure you never miss an issue of the Real Estate Business Bulletin.
Enter your email to receive the latest real estate advice and tools to help you sell.