June 15th, 2020Rent reduction query
THE REIV has written to the State Treasurer, requesting an urgent change to the process that is currently in place for a commercial landlord to receive the coronavirus land tax relief.
REIV CEO Gil King said the current method was overly bureaucratic and greatly disadvantaged commercial property owners who have negotiated a rent reduction in good faith.
Currently, a commercial tenant who is seeking rent relief from their landlord due to coronavirus has to lodge a form online. The form cannot be completed by any other party, including a landlord.
“Our primary concern is that there is no incentive for the tenant to do this, and there are no consequences for the tenant if they fail or refuse to do this.
“The completion of the form will be a low priority for tenants, and we have had examples reported to us where the tenant is effectively holding the landlord to ransom by requesting additional rent relief before they will complete the form.
“An illustration of the bureaucracy around the process is evidenced by this extract from the State Revenue Office’s website: ‘Once you have completed the form online, you need to send it to your landlord. You can download a copy, or email a copy to yourself, which you can then email to your landlord, or send it to them directly by entering their email address on the final page, titled ‘Form Complete’.”
The Real Estate Institute of Victoria requests that an alternative process be enabled to ensure landlords are not unduly disadvantaged.
One suggestion is that the rent reduction does not commence until the tenant submits the online form. Alternatively, the balance of the rent relief is to be considered as rent deferral until such time as the form is submitted by the tenant.
There are also issues in the residential rent relief space where tenants are falsely lodging “agreements” with Consumer Affairs Victoria in circumstances where no agreement has been negotiated.
CAV acknowledge the false rent reduction agreement, and when landlords or property managers contact them advising that no agreement has been reached, they are told that CAV cannot change the ‘agreement’ terms and that a new agreement with the correct details needs to be submitted.
