Alongside the recently announced moratorium on evictions, the New South Wales government promised it would not to leave landlords in the dark.
And while the latest support package focuses predominantly on businesses and households, with the offer of grants and payroll tax waivers, also included is a 60-day eviction moratorium alongside land tax relief and grants for residential landlords.
According to NSW Treasurer Dominic Perrottet, the joint federal and state government stimulus package could cost them up to $5.1 billion. Under the arrangement, the NSW government has enacted a 60-day moratorium on evictions to protect impacted renters — NSW residential tenants who have suffered a loss of income of 25 per cent.
In an effort to encourage landlords to offer impacted tenants rent relief, the NSW government has set aside $210 million for grants of up to $1,500 targeted at eligible landlords across the state.
As explained by Mr Perrottet, some landlords may opt for the land tax relief, which has been made available to commercial, retail and residential landlords, and will equal the value of rent reductions.
Minister for Better Regulation Kevin Anderson said the short-term tenancy and landlords support package will provide renters and landlords with immediate assistance during the COVID-19 lockdown.
“We know a lot of people are currently experiencing hardship, and the NSW government is here to stand with renters and landlords while we work together to get through the latest COVID-19 outbreak,” Mr Anderson said.
“Our number one priority is the health and safety of our communities, and this package will provide support for both tenants and landlords, ensuring renters continue to have a roof over their heads while maintaining rental incomes for landlords.”
Landlord reacts to stimulus payments
Despite the government’s offers of support, Atlas Property Group’s director, Lachlan Vidler, does not believe landlords are being offered fair treatment.
“I think that landlords have disproportionately worn the negative impact of eviction moratoriums,” he said.
“There has always been a perception that property investors are the ‘wealthy elite’ and this couldn’t be further from the truth. Most property investors only own one or two properties and these are everyday people like mums and dads, tradies, teachers, nurses etc.”
Mr Vidler opined that the $1,500 does not go far enough to cover the loss in rent over a period of 60 days.
“These people do not have the financial capacity to be able to pay for investment property mortgages without rental income and many have been put into financial hardship while trying to do this,” he continued.
Mr Vidler said a fairer system would allow landlords to liaise with the state/federal government and receive a taxable reimbursement equal to the lost rent. He is also suggesting the introduction of HECS/HELP-style debt raised against renters for the same amount as their rental reduction.
“This debt is interest-free and indexed to inflation (same as HECS/HELP debt) that they repay over a few financial years in a percentage-based fashion, the same as a HECS/HELP debt,” he said.
Moratorium extends to commercial and retail property
The government’s 60-day moratorium on evictions will not only impact landlords in the residential sector but also commercial and retail property.
Under the government’s arrangement, for commercial and retail property, landlords will not be able to recover a security bond, lock out, or evict tenants affected by the restrictions until first attempting mediation.
Property Council of Australia’s acting NSW executive director, Lauren Conceicao, welcomed the support, noting that property owners provided more than $15 billion of support to tenants around the country during 2020 and 2021, and are once again supporting many small, hard-hit tenants.
“The government support packages announced today are very welcome news and commercial property owners are also once again stepping up to play their part, working closely with their smaller, hard-hit tenants,” Ms Conceicao said.
“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.
“This important case-by-case support for hard-hit small business tenants will sit alongside the substantial government support announced today.”
While businesses will be negatively impacted, Prime Minister Scott Morrison also touted federal support to affected businesses and residents, announcing that around 500,000 small and medium businesses in NSW could be eligible for support payments of up to $10,000 per week.
This will apply to businesses with a turnover of between $75,000 and $50 million that have had a 30 per cent decline in turnover, according to Mr Morrison. These costs will be split 50/50 between the federal and NSW government. Small and medium businesses will be able to register their interest for the support payments from 14 July.