Pandemic protections put in place for renters will be removed in three states by the end of this weekend. Pandemic protections put in place for renters will be removed in three states by the end of this weekend.
Finance Property ‘Floodgates will open’: Fears for renters as eviction bans near end Updated:

‘Floodgates will open’: Fears for renters as eviction bans near end

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Shawn Healy is unsure what will happen to him once Victoria’s ban on rental evictions ends this weekend.

He has a $6000 debt hanging over his head and is approaching whatever comes next – he suspects a 60-day eviction notice or a lengthy battle in the state tribunal – with “fearful apprehension and anxiety”.

“It’s like a balancing act,” Mr Healy told The New Daily. 

“You’ve got all the financial stress [of the debt] on one side, and then I’ve got my employment starting to come back … and I’m sure there are many people in my situation facing the same stress, the same problems.”

Mr Healy is one of tens of thousands of renters across Victoria, New South Wales and Western Australia who will lose protections once general moratoria on evictions and rent increases in those states expire this weekend.

The state-level bans, backdated to March last year and prolonged in September, were introduced to ward off a wave of evictions as renter-heavy industries, such as hospitality and retail, bore the brunt of social distancing and city-wide lockdowns.

At the time, Prime Minister Scott Morrison urged landlords and tenants to head to the bargaining table in “good faith”.

But Mr Healy says that didn’t happen in his case.

Mr Healy rented his current home in Oakleigh, in Melbourne’s south-east, for 15 years before the pandemic and never had issues with his agent.

But after losing a casual TAFE teaching position in July, and relying on JobSeeker for essentials, the 62-year-old said problems began when he approached his agent for a compromise.

Mr Healy claims he was coerced to sign a contract that locked him into paying 50 per cent of his $1217-a-month rent during the pandemic, on the proviso that he would pay the difference once he secured a new job down the track.

But while he has only just started picking up some casual shifts, Mr Healy said he has already been bombarded with emails and texts from his agent asking for rent and threatening to replace him with another tenant unless he pays back the $6000 debt.

“I sought a reduction and was knocked back, and the inference was that I was fortunate I was not evicted despite not having a job,” Mr Healy said.

“I accept I have obligations to pay rent and finding employment again is my No.1 priority … but I feel a sense of betrayal that after 15 years as a tenant, they’ve shown no real consideration at all and landed me with quite a substantial debt.”

Landlords call for ‘win-win conversations’

Real Estate Industry Partners CEO Sadhana Smiles said she hoped the end of the moratoria could spark “win-win conversations” between landlords and tenants.

She said the 12-month impasse meant owners could not conduct rental reviews, make decisions on selling homes in heavily impacted markets such as inner-city areas, or move family into their properties.

“The biggest fear a tenant is going to have is they’ll be given 60 days to vacate … on the flipside, you’ve got owners thinking they can’t make their mortgage payments and so do they need to sell the property or increase the rent?” Ms Smiles told The New Daily. 

“I don’t think we’re going to have this massive influx of vacancy notices. Most investors buying property do so to get rent out of it, and you’re not going to get rent if you keep kicking tenants out.”

However, Dr Chris Martin from the UNSW City Futures Research Centre said a wave of evictions was more likely to happen than Ms Smiles suggested, as government support payments were being wound back.

Dr Martin said the moratoria had temporarily served to address declining affordability in the private rental market, where two-thirds of low-income tenants pay more than 30 per of their income on rent.

But he said there were lessons to be learned from the pandemic and it was up to governments to heed them.

“Governments should be taking evictions more seriously as housing problems worsen, and we should set up tribunals so they can scrutinise termination proceedings much more, with a view it’s only as a last resort and people aren’t evicted into homelessness,” he said.

“As far as rent increases go, Australia could follow what’s been done in Ireland and Scotland recently, where the rate of increase is capped in so-called high-pressure rent zones where rent cannot increase by more than 4 per cent per annum.”

Renters’ advocates fear wave of evictions

A new survey from Victorian tenants union Renters and Housing Union Victoria (RAHU) on Tuesday found one in 10 renters were in “known rental debt” despite governments imploring landlords to reduce rent based on their tenant’s drop in income.

The union, which is urging governments to extend the moratorium until September so that transitional measures can be legislated, said those figures point to a looming rental debt crisis.

RAHU secretary Eirene Tsolidis Noyce told The New Daily that unless the problem is tackled through new protections or waiving outstanding arrears, more renters would buckle under severe financial pressure.

“Without [a moratorium], we will see an absolute floodgate open of renters being evicted with notices to vacate and exorbitant rent increases all at once, and we haven’t recovered from the pandemic,” Ms Tsolidis Noyce said.

However, she applauded a move by the Victorian government overnight to help COVID-affected tenants continue with transitional measures that prevent eviction on grounds of non-payment of rent, a ban on blacklisting and extensions to any dispute orders with VCAT.

“It’s a great win for renters to see the Andrews government taking these crucial first steps in ensuring time to get through this crisis,” Ms Tsolidis Noyce said.

“We will continue to make sure that the government takes further steps to cancel debt, and truly address the housing crisis.”