What happens if I can’t pay rent due to Coronavirus (COVID-19)?

What happens if I can’t pay rent due to Coronavirus (COVID-19)?

At the time of writing (18 March 2020), Australia has more than 500 confirmed cases of coronavirus (COVID-19), a number that’s expected to grow exponentially over the coming weeks and months. Each one of us is bracing for impact in different ways – and while the outbreak is primarily a health concern, for many, the pandemic will take a significant toll on their income.

Casual and contract workers, tourism operators, and those that cannot work from home (such as those in the hospitality, arts, and entertainment industries) are most at risk of losing their living wage. Government assistance may not come quick enough, and it’s a very real possibility that people just won’t be able to make ends meet.

If your income is threatened by COVID-19, you might be thinking: What happens if I can’t pay my rent? Will my family and I be evicted? What are the protections in place?

Experts across the country and around the world are calling for eviction bans and rent freezes to help those with incomes affected by the pandemic. Here’s everything you need to know about renting a home amid the coronavirus outbreak.

Housing advocates fear an eviction crisis

The economic shock from COVID-19 could leave many reliant on Newstart, but that might not be enough, especially for those with little or no savings.

According to a 2018 report by the Productivity Commission, more than one million low-income households are renters – that’s 2.65 million people. Of this group, two-thirds spend over 30 per cent of their income on rent, with many spending even more. Most worrying, 170,000 households have less than $250 available each week after paying rent.

Joel Dignam, executive director of Better Renting, a national renters advocacy group, recently spoke to the ABC about his growing concerns.

“A lot of renters are renting places they struggle to afford. They don’t necessarily have the savings to weather them through a challenging period like this,” he said.

What do I do if I can’t pay rent in Australia?

First, check your rental agreement. Some have hardship provisions that cover things like unexpected changes to financial circumstances. The problem is, these are often only useful if you are trying to break your lease without penalty.

Your best bet is to ask for assistance from your landlord or property manager as soon as possible. Ask for either a delayed payment or rent reduction. At least for now, these decisions will be at the discretion of each landlord.

Some landlords are already reacting with empathy – we are all in this together. By keeping an open line of communication, you increase your likelihood of reaching an agreement.

If that doesn’t work, you can contact your local tenancy advocacy service for advice and recommendations. They can also suggest support services that might provide financial relief.

Can I get evicted for not paying rent?

You cannot get evicted from your home right away if you fail to pay rent. You are allowed to be behind for a set amount of time – when that time is up, you will receive a notice. The notice will give you additional time to pay the rent owed. This timeline will depend on where you live.

In New South Wales, for example, termination notices can be issued when a tenant is two weeks behind on rent. Eviction can be initiated four or five weeks following notification.

If you risk being evicted, it’s essential that you understand what it means to be ‘blacklisted.’ If your rental debt is accumulating, your landlord has every right to list you on tenant databases, and this can impact your ability to rent for up to three years.

If your landlord is unable or unwilling to give you a concession, you may be better off vacating the property sooner rather than later, if possible. Of course, this can be a really awful situation to find yourself in.

How the world is responding to renters unable to meet their obligations during the COVID-19 outbreak

COVID-19 is a global challenge – if you are anxious about your ability to pay rent as job prospects worsen, know that you aren’t alone. Here’s how government, policy-makers, experts, and advocates around the world are assisting renters:

  • San Jose, USA: Officials move to approve a temporary moratorium on rental evictions to protect low-income renters
  • Portland, USA: Portland and Multnomah County leaders announced they will place a moratorium on most residential evictions for the duration of the crisis
  • BC, Canada: The B.C. Government Employees Union (BCGEU)’s 80,000 members call for a freeze on rent and mortgage payments for sick or self-isolating employees
  • UK: Tenants call on the government to freeze rent payments as pandemic raises the threat of eviction

Updates are announced daily. Hopefully, Australia’s renters will get some respite during the challenging months ahead.

Where can I get help?

Contact the rental authority in your state or territory for help and advice.

Comments

  1. Hey there, I got 2 young kids ( 5 years old boy & 1.5 years old girl ) I just lost my job yesterday due the corona virus. My husband too.. i live in Sydney at the moment.. I’m very very upset & so depressed what we can do nex ? How we can pay out rent. I’ll try to contact the agent ASAP. Hopefully they make it easier for us 😭😭😭 break my heart!

    1. Hi Niwayan. Consider also applying for unemployment benefits as soon as possible or at least contacting the office to see what other support services you can access. We wish you all the best.

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