The RTA & COVID-19

Since March 2020, Coronavirus has brought some significant changes to our everyday norm. This extends across many households, families, and businesses.

The financial impact of this virus has been felt by many – both landlords and tenants alike.

In response to these impacts, the WA Government has recently passed a Bill to make changes to the Residential Tenancies Act (RTA), which is the legislation governing residential rental properties and leases.

This Bill will soon become law, which we expect will be sometime in the next 10 days.

So, what do the upcoming changes mean? Let us help you through them.

Emergency Period

A State of Emergency has been declared in WA as a result of COVID-19. The new Bill acknowledges an Emergency Period as part of the RTA.

When does it start? In essence, the Period will date back to 30 March 2020 and end on 29 September 2020. This can be reviewed and extended.

During this Period, there’s a few changes to provisions of the RTA to:

• Restrict tenants from being evicted if they are suffering financial hardship due to COVID-19.
• Encourage negotiation between landlords and tenants to reach an agreement regarding rent payments during the pandemic.
• Provide free, mandatory assistance in resolving any disputes through conciliation.

Tenant evictions

The new laws will see a moratorium in place to prevent tenants from being evicted if they are suffering financial hardship as a result of COVID-19.

Evictions will still be possible, however the circumstances for them will be restricted during the Emergency Period. For example, if a property is being damaged by a Tenant, applications to terminate a tenancy can still be made.

Financial hardship

There’s no specific requirement in the Bill relating to reducing or waiving rent if tenants are suffering financial hardship.

The Commerce Minister, John Quiqley, and Premier, Mark McGowan, have confirmed the expectation that this will be discussed between the Landlord and the Tenant to reach an agreement to suit both parties.

For those Tenants suffering financial hardship, get in touch with us so that we can talk you through our Hardship Declaration form and commence discussions with you and your Landlord.

Rent reductions, waivers and repayments due to financial hardship

If a reduction is agreed, this does not mean it is waived. The reduction is repayable in full. If the repayment plan results in rent owing after the Emergency Period has ended, this is still a debt payable by Tenants.

Landlords are not able to charge Tenants interest on any reduced or arrears amount.

We’re all in this together as a community, but most importantly as Landlords and Tenants. It has never been more important to work together and support one another through this pandemic.

Restriction on breach notices

Once the new laws come into effect, a breach notice can only be issued during the Emergency Period if there is a rent repayment agreement and a Tenant defaults on that agreement.

If a Tenant fails to pay rent, without a rent repayment agreement in place, unfortunately a breach can’t be issued until 3 months after the Emergency Period ends.

What we can do though is make an application to the Commissioner to commence conciliation. The aim of conciliation is to come to an acceptable rent repayment agreement. This will be facilitated by a third party.

Freeze on rent increases

Rent increases cannot be implemented during the Emergency Period if;

• The date of the rent review specified in the lease is within the Emergency Period.
• A tenant enters into a new lease for the same property. They can only be required to pay the same rent they were paying in the current lease.

If a rent increase is due under the lease agreement, this will not take effect until the end of the Emergency Period.

Maintaining the property

Landlord’s won’t be required to conduct ordinary repairs during the Emergency Period if they are suffering financial hardship as a result of COVID-19.

Ordinary repairs may also not be required if there is also a direction given under the Emergency Management Act 2005 or the Public Health Act 2016.

Fixed term tenancies automatically convert to periodic

Fixed term leases that come to an end will continue as periodic tenancies if a new fixed term lease isn’t entered into. This is not much different to what would normally happen at the end of a fixed term tenancy but gives Tenants a greater opportunity to stay on in the property if they like.

Landlord’s we recommend that you get in touch with your insurer to check your policy details. Periodic tenancy agreements might impact what your policy will cover you for.

Termination of tenancies

As normal, a Tenant may terminate either a periodic agreement by giving the owner 21 days’ notice. This is as per current regulations.

Under the changes, Tenants may also terminate their lease if:

• They are suffering financial hardship due to COVID-19, even in a fixed term agreement.
• Due to family domestic violence, as per the current RTA regulations around these circumstances.

For more information on how this new legislation may impact you, get in touch with us on 9755 8234.

You can also read the media statement issued by Mark McGowan, Premier, and John Quigley, Minister for Commerce, here or check our the FAQ's from the Department of Mines, Industry Regulation and Safety here.