2. The same can’t be said for Sydney CBD though. Sydney CBD and some parts of the Eastern Suburbs on the other hand, can only be described as the toughest they have been in a long time. Vacancy rates are now upwards of 10% in some areas due to short term accommodation apartments entering the long term market and a massively reduced pool of tenants. Tens of thousands of international students that UTS, UNSW and the University of Sydney would have had at this time of the year, are simply missing. The same is also the case for all the international travellers – whether business or tourists – who are missing…. Simply put, there are fewer people wanting to rent in or around the CBD and I have personally seen properties staying vacant for weeks even though the rent has been reduced by $100-$250 a week. I do feel for those landlords! The CBD market will be tested hard, so if you have a vacant property there, you are probably competing with 500 almost identical properties right now – and probably with 10 or more in your own building!!! sorry… Make sure to keep your property manager on their toes. They will not invest new tenants for you but they need to be alert to snatch the few that still exist.
Landlord support and handling Rent Relief Requests
1. Make sure your property manager follows a formal process from the start and there is a formally documented record of the agreement. I have seen too many verbal agreements which are leaving everyone confused and tenant ledgers looking weird!
2. Make sure your property manager confirms eligibility before they go too far and they share with you. Requesting bank statements and payslips is uncomfortable at the time of someone’s need, but it is only fair and it is no different to when tenants applied for the property in the first instance.
3.Make sure any agreement has at minimum a start date, an end date, the reduction amount during this period, the amount the tenant needs to repay in the end (OR not), and what happens at the end of this period. At best it is a digitally signed document… At worst an email. Both are considered legally binding in the current environment and be used as evidence at Tribunals.
4. Make sure the agreement has regular reviews (ie monthly) embedded – which require the tenant to continue to provide evidence.
5. Check your statement that it reflects the new rent during this period so it is easy to see what period the tenant has paid for under the new arrangements.
6. For rent repayment agreements, a major sticky point in the negotiations will be when the tenant will commence paying back. This is because no one knows right now when they will be able to. Don’t get hung up on a date, but make sure that your property manager raises immediately future dated invoices for the tenant – to be paid following the end of the agreed period – but are subject to the tenant’s ability to make repayments. This is hardly any protection for the landlord but it is the best under the circumstances.
7. What and if insurers will cover rent loss has not been probably tested because of the 60 day moratoriums in place. Most insurers will not accept claims until the tenants have vacated and the loss is known. Most insurers though proclaim that there is some protection, as long as there is an agreement for the tenant to pay back any shortfalls… time will tell…
8. Most insurers are advising that a rent relief cannot be claimed. It is considered the landlord’s gift to the tenant. If you do intend to use your landlord insurance for shortfalls, you are better off opting for a rent repayment plan.
9. If an agreement has not been reached with the tenant, the next point of call is to refer the matter to the department of Fair Trading for mediation. The form to do this is https://www.cas.fairtrading.nsw.gov.au/icmspublicweb/forms/Tenancy.html. It is not a hard form to complete. Stick to the facts and attach documents that will demonstrate your efforts to negotiate.
10. Last but not least, you can still apply to NCAT for termination, if you believe you have been fair in your approach considering your circumstances and you have done all you can to reach an agreement.
Who we are:
If you liked the content of this article and would like to learn more about NextGen and the services we provide, feel free to make contact with us by filling in the form on this location https://nextgenpm.com.au/contact-us/.
NextGen Property Mgmt (www.nextgenpm.com.au) is a boutique Real Estate licensed agency that specialises in property management. NextGen Property Mgmt does NOT have a sales team unlike most other agencies that specialise in Sales and have Property Management as a side business.
Our area of focus is residential property and we operate in the Eastern Suburbs, Inner West, Canterbury-Bankstown, South West Sydney, and St George.
NextGen was created from its infancy to cater for investors as it was founded by investors who quickly realised that in a highly regulated industry like Real Estate – competence, expertise, care and service by property managers varies greatly.
As an investor, you need to have trust for and feel valued by your property manager. You need to know that your property is being looked after and you are getting maximum return for your investment. At NextGen we understand that because we are investors with busy lives ourselves.