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Residential rental rules during the COVID 19 moratorium

Written by Elishah Lusi
It has been a challenging year for Landlords who have had tenants in financial hardship. The Victorian Government put in place a moratorium on evictions, rent relief for eligible tenants, suspension of rental increases, and a continued dispute resolution process. The moratorium also made changes to how a tenant or landlord may end a tenancy during the moratorium period.

This means, we cannot increase rent even if it has been previously agreed and a tenant can provide 14 days notice to vacate if they are suffering financial hardship without any lease break fees.

Since March 2020 we have been receiving enquiries from tenants suffering hardship and have been processing requests to assist with their rental payments. Here we look at the steps we take when we are dealing with a rent reduction request.

Firstly, it is important to understand that if the tenant requests a $100 per week rental reduction, the landlord does not need to agree. There is no fixed amount of a rent reduction that the landlord must provide. We carefully assess each tenants financial situation and respond with a negotiated rental reduction amount that is suitable for both the landlord and tenant. In some cases the landlord is also in financial hardship and the rental reduction amount has been as little as $10 per week to assist them with qualifying for the rent relief grant.

Once the amount of rent reduction is agreed a ‘Residential Deed of Variation’ is prepared detailing the terms of the agreement and signed by all parties. The tenant can then make an application for the rent relief grant of $3000 if they are eligible.

To be eligible for the grant tenants will need to have registered a reduced rental agreement with Consumer Affairs Victoria. Deferral of rent is not considered a rent reduction and therefore does not meet the eligibility criteria. The household income must be less than $1,903 per week, and have less than $10,000 in savings and still be paying at least 30 per cent of your income in rent.

Once the rent relief grant application is complete, if approved the funds are transferred directly into the agents account to be paid to the landlord as rent.

Navigating this new and unfamiliar landscape has been interesting , we have adjusted quickly and have been very fortunate that our skill set and technology have enabled us to send everything remotely.

If you have any questions on the changes or would like to discuss how we can help please get in touch.

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