The moratorium has lifted, so rental owners should be happy, right? Not quite. Yes, a huge collective sigh of relief has been felt by owners, but the very real risk of another moratorium being called – with the same faulty and short-sighted legislation that generated significant unfairness – is hanging over the head of every rental owner and potential rental investor.
For almost a year now, the Tasmanian Residential Rental Owners Association has been calling on the Government to correct the extreme and flawed legislation they rushed through in panic. Tasmania is the only state that protects all tenants from eviction, regardless of whether they have been financially hurt by COVID-19 or not. During the ten-month long emergency period, in Tasmania every tenant could simply choose to stop paying rent, with no penalty, no questions asked. And many did just that. Every other state, as one would expect, requires tenants to demonstrate that they have been financially hurt by the pandemic to be protected from eviction for non-payment of rent – a very important condition that Tasmania overlooked or ignored.
But that is old news? Sadly not. The Government can reintroduce the same moratorium almost instantly should they feel the need. Despite pleading with the Government for them to address the obvious faults in their legislation (at a time of relative calm), *crickets* silence from the Government. The Government clearly wants critique of their moratorium to go away. But that cannot happen as the impact and consequences are too great and correcting the situation is highly feasible, making their reluctance to own and correct the faults even more bewildering.
Yes, most tenants honoured their lease commitments (helped by new and boosted income support), but – as per human nature and statistics – if something can be abused, you can be assured it will be. The Tenants Union of Tasmania and the Government have both, reluctantly, admitted that the moratorium has been taken advantage of by some “bad eggs” in an “unfortunate” situation. Even with this insight, the Government is silent on any intention to fix the errors, which can only be interpreted as them being happy for there to be more of the same if/when another wave hits.
At a time of so much uncertainty, providing clarity when and where you can is critical, especially when roofs over peoples’ heads is at stake. Rental owners and would-be investors are highly aware that we can be back at day one – again forced to provide their product in exchange for a vague IOU – should Tasmanians be at risk of infection on home soil or some other stretch of this rationale.
The looming dark cloud of another moratorium under faulty legislation hurts everyone. Rental owners are fearful and managing their risk by removing their properties from the rental market and holding back on investment property purchase. This fear and caution quickly hurts tenants. While owner-occupier purchases are exploding, investor actively is subdued. Hardly surprising given the extreme intervention that has unfolded through the moratorium.
But high levels of owner-occupier purchases are a good thing, right? Yes, if you can pay the top dollar homes are demanding. But if you are one of the many thousands of Tasmanians for whom purchasing is still out of reach, then low investment activity is not good news for you. With demand overwhelming supply, every home is precious and issues that deter rental investment should be address and considered with great care and urgency.