Code red for landlords as WA extends rent waivers
Property Council WA Executive Director Sandra Brewer said she is disappointed that the State Government has extended an emergency Code that compels landlords to provide millions of dollars in rent waivers to tenants.
The Code, an emergency pandemic measure enacted by National Cabinet in March, was designed to share the losses borne by small business tenants forced to shut down because of COVID-19. It was to end on September 29.
However, Ms Brewer said for the most part it was business as usual for WA with the state clearly re-opening.
“Our WA members have given very substantial financial support to their tenants,” Ms Brewer said.
“Continuing the code has the potential to threaten the viability of many small and mid-sized property businesses.
“It will also hurt the income of big property owners, resulting in reduced returns for every West Australian with superannuation.
“We would like to see the WA Government provide genuine land tax relief to support property owners who have generously supported their tenants.”
In other States, landlords with eligible tenants were offered land tax rebates – if they passed at least the amount of the rebate on to their tenants in rent relief. In WA, landlords were required to pass on roughly ten times the amount of the land tax rebate to qualify for relief.
In Victoria and South Australia, where codes had also been extended, land tax relief for landlords had gone from 25 per cent to 50 per cent.
Ms Brewer said Property Council WA would now focus its attention on ensuring the new regulations prevent rent relief being provided to tenants who are actively limiting their hours of trade or refusing to pay rent.
She reiterated her previous comments that the fact that there have been a relatively small number of landlord-tenant disputes indicated there was no need for the Code to continue in WA. It has been extended in a modified form until March 28, 2021.
Ms Brewer said extending the Commercial Tenancies Code in WA undermined the capacity of the sector to contribute to the joint industry-government rebuilding effort, crucial to rebooting the WA economy, supporting projects and generating jobs.
“Property Council WA has been critical of the hurdles for land tax relief for WA property owners,” Ms Brewer said. “We’d urge Premier Mark McGowan and Treasurer Ben Wyatt to make it easier for landlords who are doing the right thing to get access to land tax relief.”
Property Council of Australia-commissioned research by Deloitte Access Economics estimates the Australian property sector has already paid out an estimated $4 billion to tenants under the Code. The amount paid out rises to $6.8 billion when it takes into account rent assistance Australian landlords have given to tenants who did not qualify under the Code. If the Codes in each State and Territory are extended so that they operate for 11 months, the amount transferred from landlord to tenant under the Codes could rise to $8.8 billion.