What Landlords Need To Know About COVID-19

The COVID-19 pandemic is impacting every aspect of our lives right now, including the Perth rental market.

We take a look at what every investor needs to know about tenancies, rent and rental properties in WA right now.

Can tenants really stop paying rent during COVID-19?

Most tenants will still need to pay the rent as usual, despite any media reports you may have heard to the contrary. The exception is, understandably, tenants who are facing genuine financial hardship as a result of COVID-19. But even then, they can’t just stop paying rent altogether without letting you know.

The WA Government says tenants need to tell you as soon as possible when they’re facing financial hardship and that you should work with them to find a way through the current situation. The government also says this may include coming to a solution such as deferring the rent, decreasing it for a specified period or letting them terminate the lease without penalty.

That said, tenants must give you 21 days notice if they terminate a lease due to financial hardship.

Can I evict tenants during COVID-19?

A lot of landlords are asking about the Commonwealth government’s announcement that there would be a six-month moratorium on evicting tenants who don’t pay rent. This policy applies in all States and Territories, including WA.

Again, this doesn’t mean tenants can simply stop paying rent. What it does mean is that you can’t terminate a tenant’s lease until after 30 September if they can’t pay rent. Rent will still accrue during that time, even when it’s not being paid, and they’ll continue to owe you until they’ve cleared the debt.

Rather than letting the situation get to this point, we recommend you speak to us so we can negotiate an arrangement that suits both you and your tenant and makes sure you have the best chance of recovering rent.

Are there any other changes or restrictions on what landlords can do?

The same regulations that introduced the moratorium on evictions have also introduced a number of other changes to the landlord/tenant relationship. These include:

  • a ban on increasing rents until 30 September 2020
  • converting all leases that expire between now and 30 September to periodical tenancies unless both parties agree to enter into a new fixed-term agreement
  • waiving interest on any rent arrears that accrue until 30 September 2020.

Can I still rent out an investment property during COVID-19?

Yes, none of these restrictions affects your ability to rent out a property you own. You can still advertise a property online, show it with a virtual tour or one-on-one appointment, and even sign a lease electronically to minimise social contact.

While the government strongly advises people to stay home it also says tenants can move during COVID-19 if it’s essential to do so. It also says people should exercise ‘common sense’.

How has the rental market changed?

From a practical point of view, one of the main changes has been in the way we can show rental properties. Because social distancing means we have to keep everyone 1.5 metres apart we can no longer hold open home inspections with groups of people coming through. Instead, we must show properties by appointment only.

Without open homes, it’s more important than ever that you market your property in a way that makes prospective tenants take positive action. We believe it’s more important than ever that you invest in proper marketing. This should include good photography and copy.

Our website lets prospective tenants book an inspection online and even apply for a lease just by clicking a button. This has already proven an important tool in getting the rental application process moving during COVID-19.

What happens if my property needs maintenance or repairs?

If a tenant asks you to repair or maintain a property during COVID-19, you should still treat their request as you normally would. We can still get tradespeople to attend your property, even during the current restrictions.

The exception is where you’re suffering financial hardship as a result of COVID-19. In this case, the new changes to tenancies mean you don’t have to carry out repairs when you fall into this boat.

What if a landlord is suffering financial hardship?

COVID-19 isn’t just forcing tenants into financial hardship; it’s also impacting many landlords.

If you’re suffering financially and have a mortgage over your investment property, you may be able to speak to your bank about pausing your repayments for up to six months. This could give you the financial breathing space you need.

If your tenant can’t pay full rent, you should also check your landlord insurance to see whether you’re covered.

Get in touch

You’ll be pleased to know it’s business as usual for us during COVID-19, even if we’re facing new restrictions on the way we have to carry out some aspects of our work.

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