Coronavirus residential tenancy changes- Queensland
The COVID-19 pandemic is a difficult time for many tenants and property owners and managers, especially when tenants face excessive hardship, which may impact their ability to maintain payments. Social distancing requirements may also impact obligations under tenancy law, including inspections of premises.
The Queensland Government recently passed the Residential Tenancies and Rooming Accommodation (COVID-19 Emergency Response) Regulation 2020 (“Regulation”). The Regulation was implemented as part of National Cabinet’s temporary six-month freeze on evictions under the COVID-19 Emergency Response Act 2020 (“Act”) and the Residential Tenancies and Rooming Accommodation Act 2008 (“RTRA Act”).
The Regulation applies to all residential tenancy agreements and rooming accommodation agreements in Queensland entered into before or after 29 March 2020, but is limited to tenants who have suffered excessive hardship because of the COVID-19 emergency.
COVID-19 excessive hardship
The tenant qualifies as a person suffering excessive hardship if the tenant:
1. If during the COVID-19 emergency period:
o They or someone they care for are affected by COVID-19;
o They are subject to a quarantine direction;
o A public health direction has closed their employment or restricted their employer’s trade or business, including for e.g. a public health direction has closed a major supplier or customer of their employer;
o They are self-isolating because they or someone they live with or are a primary carer for is a vulnerable person;
o They are unable to work because of travel restriction imposed under a public health direction prevents them from working or returning home;
o They have been prevented from leaving or returning to Australia; AND
2. The tenant suffers a loss of income of 25% or more OR the rent payable is 30% or more of the tenant’s income. If there is more than one tenant under the agreement, there must be a loss of combined income of 25% or the rent must be more than 30% of their combined total income.
When does the moratorium on evictions apply?
Between 29 March 2020 and 29 September 2020 (or an earlier date if the COVID-19 emergency period is declared to have ended), a landlord must not evict a tenant (or enlist them in a tenancy database) for failure to pay rent if the failure is due to the tenant suffering excessive hardship because of the COVID-19 emergency.
The moratorium does not prevent a landlord from ending a tenancy for another reason other than failure to pay rent, though a landlord is prohibited from giving a notice to leave without grounds during the COVID-19 emergency period if the tenant is suffering excessive hardship.
Extension of fixed term agreements
If a tenancy agreement for a fixed term ends after 24 April 2020 but before 29 September 2020 and the tenant is suffering excessive hardship because of the COVID-19 emergency, the landlord must extend the term to 30 September 2020 unless the tenant requests a shorter term.
The Regulation also prohibits landlords from giving tenants a notice to remedy breach if the rent has remained unpaid for 7 days and the landlord knows, or ought reasonably to know, the tenant is or has been suffering excessive hardship because of the COVID-19 emergency.
Instead, a landlord may give the tenant a show cause notice either requiring the tenant to pay the unpaid rent or to inform the landlord that rent is unpaid because the tenant is or has been suffering excessive hardship within 14 days.
If no notice is given by the tenant within 14 days, the landlord may give the tenant a notice to remedy breach for the unpaid rent. However, if the tenant later claims excessive hardship, the landlord will not be able to give a notice to leave for unpaid rent or obtain a termination order.
Negotiating rent variations
Landlords are not required by the Regulation to agree to vary rent, but may agree with the tenant to either a rent reduction or rent referral with payment plan, the terms of which should be recorded in the approved form (Form 18d General tenancy COVID-19 variation agreement).
Landlords should look into any available financial relief, such as Commonwealth income support, Queensland Government land tax relief and utilities rebate, and speak with their financial institution to discuss the possibility of temporary relief from mortgage repayments during COVID-19.
Entry and inspection of premises
Entry to the premises by the landlord or their agent for certain purposes are prohibited where:
• A person at the premises is subject to a quarantine direction; or
• The landlord or agent is subject to a quarantine direction; or
• The entry would contravene a public health direction; or
• The tenant refuses entry to the premises because the tenant, or another person staying at the premises, is a vulnerable person.
These restrictions will impact a landlord’s right of entry including entering to show the property to a prospective buyer or for the purpose of a valuation as the tenant can lawfully refuse entry.
However, entry is permitted for emergency repairs and maintenance and the landlord’s obligations for routine repairs and maintenance are relaxed.
If the tenant has not claimed excessive hardship the usual notice to leave provisions in the RTRA Act will apply, subject to some changes introduced by the Regulation. The Regulation includes additional approved reasons for a landlord to give a notice to leave, such as if the property is being sold or if the landlord or a member of their family needs to move into the rental property.
If the tenant does not leave after a valid notice to leave for an approved reason is given, the landlord may apply for a termination though conciliation may be required under the RTRA Act.
There are also new approved reasons for tenants to end a tenancy during the COVID-19 emergency if the tenant because they can no longer safely live in the rental property because of domestic or family violence or within the first 7 days of moving into the rental property, the tenant finds the property is not in good repair.
How we can assist
The Act has significantly changed the residential tenancy scene, please contact our Property Teams if you have any questions about your new obligations during the COVID-19 emergency period. The Queensland Government has also created The Residential Rental Hub (https://www.covid19.qld.gov.au/the-hub) which contains many useful information such as the Residential Tenancies Practice Guide which can be downloaded via this website.