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covid 19 Impact on Real estate

The coronavirus pandemic has a huge impact on the property markets. In response to COVID-19, the Western Australian Government implemented a moratorium on some evictions and all rent increases, under the Residential Tenancies (COVID-19 Response) Act 2020.

Perth’s rental market has held up well comparatively, with CoreLogic data showing it to be the only capital city in Australia to record growth in rents. 

Despite initial concerns, we didn’t end up seeing a huge demand for rent reductions. REIWA data shows that ONLY 1% of the 160,000 private tenancies in WA had been unable to meet their full rental obligation and rental arrears are at record lows.

In response to the COVID-19 pandemic, the West Australian government has passed new laws to prevent tenants from being forced to move out of their rental properties or be made homeless during the COVID-19 pandemic.

The West Australian government also announced that those struggling to pay their rent could be eligible for a grant of up to $2,000 for four weeks rent as part of a $30 million scheme that started on 1 May 2020.

About Covid-19 Act 2020

The emergency period ends on 28 March 2021. To help all parties: landlords and tenants “Future renting WA Negotiating Guide was created. Read here.

What is the Residential Tenancies Act 2020 moratorium?

It addresses matters on evictions and other measures relating to residential tenancies to address the financial impacts of COVID-19.

  1. Renters can still have their leases terminated and be evicted if they are causing serious damage to the property, posing a threat to the landlord or neighbours, not paying rent when they are not in financial hardship due to COVID-19, refusing to make a rent payment agreement with their landlord or if they abandon the property.

 Other elements of the laws include

  1. a ban on rent increases during the moratorium period;
  2. fixed-term tenancies will automatically convert to periodic tenancies if they expire during the period unless another fixed-term agreement is entered into; landlords do not have to carry out non-urgent repairs if they themselves are experiencing financial hardship or are not able to access the premises due to restrictions on movement;
  3. and renters experiencing COVID-19 related financial hardship who end a fixed-term tenancy prior to its end date will not incur break lease fees, but will still be liable for damage and rent arrears.

Landlords or renters who are experiencing undue hardship can apply to the Magistrates Court or State Administrative Tribunal to have the tenancy agreement terminated. For example, a landlord who loses their job and needs to move back into their rental property can still apply to the court. Here are some links we have complied for you.

In March, the Reserve Bank of Australia (RBA) announced an unprecedented stimulus to help support businesses and households through the economic downturn caused by the coronavirus pandemic! The RBA cut the cash rate cut from 0.75 percent to 0.25 percent, along with a commitment to not increase it until the economy has clearly recovered.

Please contact us if you require further information.

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