Without a doubt, the coronavirus pandemic that has been infecting millions of people worldwide has changed the world in many ways possible. The restrictions introduced by each government, have reformed our lifestyle and how the businesses operate.
Due to the closure of the borders of 200 countries, many organisations were forced to lay off their employees to survive. This result in a massive surge of unemployment numbers in a matter of days, not even months. Up to June 2020, Australia recorded 835,000 unemployment to 12.1 million total workforces. Not to mention, there are 2.3 million people out of the total numbers were affected by the lockdown (reduced hours or reduced income). (Source: https://www.abs.gov.au/ausstats/abs%40.nsf/mediareleasesbyCatalogue/F00771E26218DFB1CA258479001AAD2E?OpenDocument )
These people who have been affected by Coronavirus (Covid19) economic crisis were either homeowners, tenants, or landlords. We received a number of phone calls from the landlords who engaged with different agencies and they consulted about the way their property managers handling the situation. It’s been acknowledged that most agencies who handle the tenancies affected by the crisis were overloaded and struggling with their bandwidth. And, as the numbers suggest, there could be between 25% or almost 50% of tenants affected by Covid19 crisis.
Let’s start with some common approaches that the troublesome property managers take during this crisis:
- Due to the moratorium of tenancies newly introduced by the federal government which is NOT to evict any current tenant who is affected by the crisis, the property managers would tend to move the pressure to the landlords’ hands by using the moratorium as a legitimate reason to force the landlords to bear all the costs. Many landlords get pressured either to reduce rent significantly (approximately 50% of the current rent) or to provide rent relief for a number of weeks.
- Property Managers would present tenants’ cases to the landlords without sufficient and legitimate information. Many Property Managers did not even collect financial information from the tenants and provide support to the tenants’ difficulties during the crisis. In the absence of sufficient financial information, tenants get the benefits without the needs to prove their legitimate financial hardship. Some tenants might make the opportunity best toward their favour if there is negligence of the Property Managers.
- Some property managers handle this Covid19 situation reactively. As the managers have been overloaded with the tenants’ financial hardship issues, they ignore their due diligence and leave the matter undiscussed. And it usually follows with the managers try to avoid the landlords’ contacts. This issue leads to many other unresolved issues caused by the negligence of this type of property managers who leave the communication behind. This questionable approach leaves tenants’ obligations to remain unpaid for a number of weeks or even months.
- If the tenants decide to leave and need to find another tenancy, the property managers would slash the rental price as low as possible to beat the competition which result in current “rental property bloodbath”. The tight competition of long term rentals have been pressurised by the higher supply of AirBNB property types and short term accommodation or service apartments.
There were about 24 reported cases of tenancy hardships during the pandemic in Capital Value International Group up to 30 April 2020. Four weeks later, 23 reported cases have been on track with the current rental payments. Only 1 case that we are still closely looking after and committed to finding the best solution for this matter. During pandemic, the quality of the property managers was showcased. We believe that we look after our landlords and tenants by approaching each of the members in care, love, and patience. Therefore, this success has allowed helping all our landlords with less stress and professional manner.
If your investment property was mistreated, our property management division has helped landlords with the correct approach, basis, procedures, experience, and knowledge. We believe that our quality of work deliver its result. Please contact Agnes (Property Manager) to discuss the best way to find solution between your property and tenant at email@example.com or (02) 8386 2977.