With lockdown restrictions relaxing, so too are some of the interim measures introduced to help those who were affected financially by the lockdown.

As of 14 June, the 60 day stop on evictions for rent arrears, where the household is in financial hardship due to COVID-19 ended. This means a landlord may give a termination notice or applying to the NSW Civil and Administrative Tribunal (NCAT) for eviction orders for rental arrears.

This measure was introduced to allow time for Government financial support to reach those who needed it and to limit social movement during the pandemic.

However, tenants can’t be evicted on a landlord’s whim! Landlords still need to:

• participate in good faith in a formal rent negotiation process
• can only apply to NCAT for a termination order or issue a termination notice for rental arrears on a COVID-19 impacted tenant if it is fair and reasonable in the circumstances to do so.

Good faith negotiations

When we are in negotiations with tenants for whatever reasons, we always act in the best interest of landlords and we always act within the law. The NSW Office of Fair Trading states in general, a good faith negotiation means parties dealing honestly and fairly with one another to genuinely work towards a prompt and mutually beneficial agreement.

The Office of Fair Trading also points out good faith will depend on the circumstances of each case. All parties must act reasonably and be prepared to change their position or make concessions to achieve an agreement.

Furthermore, if a negotiated agreement can’t be reached, both landlord and tenant will need to show they’ve attempted to negotiate in good faith.

Other new measures

There are some other measures which have been introduced. These include:

• a 6-month restriction on landlords evicting tenants who are financially disadvantaged by COVID-19, unless they have first attempted to negotiate a rent reduction with the tenant.
• extended notice periods for certain other lease termination reasons.
• allowing tenants financially disadvantaged by COVID-19 to terminate a tenancy agreement where a landlord will not negotiate or where it is necessary to avoid financial hardship.
• retaining the ability of landlords to terminate a tenancy agreement in cases of undue hardship.

Assistance for landlords

We do appreciate the potential financial implications and concerns for all parties in this current situation. If you are facing financial difficulties, Fair Trading encourages landlords to:

• ask their financial institutions for a temporary mortgage freeze or reduced repayments if their tenants are struggling to pay the rent
• check if their insurance covers rental reductions or default
• check eligibility for the recently announced land tax reductions

For more information about the restrictions on landlords seeking to evict tenants due to rental arrears as a result of COVID-19, visit https://www.fairtrading.nsw.gov.au/

If you have any queries at all about the above information and want to know more about how our property management services can assist you, give us a call on 02 4956 9777 or send us an email to mail@newcastlepropertymanagement.com.au.

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