Is cancelling rental debt in Victoria the answer?

Concerns have been raised about the suggestion that Victorians should have their rental debt cancelled.

As the end of the state’s rental moratorium looms, the idea has been put forward that those in the red should see their rental arrears wiped out, leaving the taxpayer to pick up the slack.

But real estate bodies have come out in opposition of those proposals, arguing that the wrong message would be sent out by rental debt being cancelled and that the notion is very one-sided.

The Real Estate Institute of Victoria (REIV) President Leah Calnan believes that Victoria’s roadmap should show more consideration given to landlords and property owners.

“The pandemic hasn’t been selective, it has hit everyone; tenants, landlords and property managers,” she said.

“It is irresponsible to suggest that all rental debt should be wiped as it may be another person’s only source of income,” said Ms Calnan.

A total of 120 proposed changes to Victoria’s Residential Tenancies Act are set to come into force the day after the eviction moratorium ends, and Ms Calnan feels that such a turnaround will put huge pressure on tenants as well as landlords.
 
“It is vitally important that property managers and landlords are given sufficient advance notice of the detail behind the changes to the Residential Tenancies Act,” she said.

The landlord investors are critical to keep the Victorian property market stable.

The Real Estate Institute of Victoria President – Leah Calnan

REIV CEO Gil King echoed Ms Calnan’s thoughts and said that such upheaval to rental legislation, at a time when stability and reassurance is needed, will in fact have the reverse effect.

“I am concerned that the government is taking a one-dimensional view of this and may simply wipe the slate clean on debts and rental disputes come the end of the moratorium,” he said.

“This would simply force many mum and dad investors from the market and cause mayhem at a time we should be working towards an economic recovery,” Mr King said.

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