The NSW government has introduced measures to help landlords and residential tenants work together during the COVID-19 pandemic. The 6-month package is designed to support tenancies to continue wherever possible.
Note: These measures are not applicable to social housing tenants.
Residential rental eviction orders
There is a moratorium (ban) on eviction orders being issued due to rental arrears for:
- tenants who have been impacted by COVID-19, and
- where landlords and tenants try to negotiate rental reductions.
Impacted by COVID-19 means a household has suffered a 25% or more reduction in household income (after tax, and inclusive of any government assistance), because one or more rent-paying members has:
- lost employment, income or work hours due to COVID-19 business closures or stand-downs, or
- had to stop working or reduce their work hours due to illness with COVID-19, or due to COVID-19 carer responsibilities for household or family members.
To show that they are impacted by COVID-19, the tenant will need to provide documents proving:
- job termination/stand-down, or loss of work hours
- Government income support, or
- prior income (after tax).
Tenants will be protected from being added to tenancy databases (or ‘blacklists’) for breaches of agreements resulting from COVID-19 impacts.
If you're not impacted by COVID-19 you're expected to honour your existing tenancy agreements, including paying all rent and charges in full.
A 60-day stop (ending at midnight on Saturday 13 June 2020) has been put on new termination notices and termination applications where tenants can show that their rental arrears are due to COVID-19.
The 60-day stop is to allow time for:
- the government's income support payments to reach tenants who need financial support
- landlords to negotiate a reduction or waiver of mortgage repayments with their lender.
For terminations not related to rent arrears there will be an extension of notice periods from 30 days to 90 days. This extension is to minimise avoidable housing disruption and movement.
Negotiated rent reductions
If a tenant still can’t pay their rent due to COVID-19 after Saturday 13 June 2020, the landlord must try to negotiate a reduced rent with the tenant.
Fair Trading has dispute resolution officers available to help landlords, managing agents and tenants negotiate temporary changes in rental arrangements, if agreement cannot be reached between parties.
After Saturday 13 June 2020, a landlord will be able to give a termination notice or apply for an eviction:
- if they've tried to negotiate a rent reduction with the tenant in good faith, and
- seeking a termination is fair and reasonable in the circumstances of the specific case.
Landlords should seek to negotiate with their lender to try to obtain an agreement to waive or reduce mortgage repayments.
Agents and landlords must not encourage tenants to access their super early to cover any rental arrears. Financial advice can only be provided by qualified and licensed financial advisers or counsellors.
The amount of rent arrears accrued by a tenant who has negotiated reduced rent will not automatically be waived unless the landlord agrees to this.
Landlords will be eligible for a land tax waiver or rebate of up to 25 per cent if they pass the saving on to tenants in financial distress.
Landlords can still apply to the NSW Civil and Administrative Tribunal at any time to take possession of a property if they are experiencing significant financial hardship themselves.
Note: More detailed information for tenants and landlords is available on the Fair Trading website.