Property managers across the Gold Coast are bracing for some tough discussions as the financial fallout caused by COVID-19 hits tenants and landlords.
The Federal Government yesterday announced a moratorium on evictions for both commercial and residential tenants during the coronavirus pandemic.
Prime Minister Scott Morrison called on property managers, landlords and tenants to work together to try to come to an arrangement to get them through for the next six months.
Shane Colquhoun, Director for LJ Hooker Group covering Nerang, Pacific Pines, Helensvale, Hope Island, Coomera and Ormeau, said while requests for rental leniency to date were few, he expected the full impact to play out over coming months.
“It’s very early stages, and people at this point will be using their cash reserves to pay for things like rent until they can negotiate something moving forward,” he said.
Mr Colquhoun said his office had drafted a document for tenants detailing the proof required to apply for a rental reduction.
“They have to prove that they don’t have work, they will need to show bank balances and proof from Centrelink that they’ve applied for assistance before a rental reduction can be considered,” he said.
“We need that information before we even go to our landlords, otherwise you could get a lot of tenants crying poor because of the situation we’re in.
“I’m also mindful that there are investors out there who have also lost their jobs, so it’s a double uppercut to lose that rental income as well.”
Property managers are also faced with the daunting task of considering each request individually in order to negotiate a solution that works for both tenant and landlord.
“It’s a massive job for our property managers moving forward,” said Mr Colquhoun, who has already been forced to cut eight staff to manage COVID-19 losses.
“We also have to rely on less people doing more … and potentially for no income. If we don’t get rent, then we don’t get a management fee.”
Down the southern end of town, DJ Stringer Principal David Stringer said property managers and landlords were awaiting further detail on the assistance package for tenants.
“It’s a good thing for tenants who can’t be evicted for six months, but it doesn’t allow them to stop paying the rent,” he said.
“The other stimulus package that’s due is some form of grant to help tenants to pay their rent, but the big quandary for everyone today is understanding who that money will go to.”
The call for clarity was echoed by the Real Estate Industry of Queensland (REIQ) and also highlighted the need for property managers to be recognised as an essential service.
“What we need is urgent action with clear directives right now for both commercial and residential tenants because there are far too many unanswered questions both businesses and people are still anxiously awaiting clarity on,” says Antonia Mercorella, CEO of The REIQ.
Real estate professionals manage close to 600,000 Queensland households through property management services.
“This is why it’s so critical that the role of real estate professionals is endorsed an essential service so we are able to achieve what the Prime Minister is asking for – for property owners and tenants ‘to sit down and come up with arrangements that enable them to get through this crisis’,” Ms Mercorella added.
The Federal Government is expected to announce further measures with regards to assistance for tenants who have lost income as a result of the coronavirus pandemic.