Landlords are in need of support from the government to be able to assist their tenants amid the COVID-19 pandemic, according to the Property Investors Council of Australia (PICA).
Ben Kingsley, chairperson of PICA, said many landlords are "everyday Australians" who are also affected by the impact of the outbreak on the economy.
"Let's be clear — landlords understand the situation. The vast majority are hardworking, average Australians who own just one rental property," Kingsley said.
However, he said most of these landlords might not be able to bear the cost of having reduced or no rental income while still having to pay for mortgage, taxes, repairs and maintenance.
"State governments have been asked to establish programs to assist struggling tenants. As the peak body representing landlords, PICA welcomes the opportunity to be part of those discussions," Kingsley said.
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PICA laid out some of their suggested policies that would help landlords amid the outbreak. One recommendation is for the Australian Prudential Regulation Authority to relax lending guidelines, allowing investors to refinance at better terms and conditions.
Another possible change that will help landlords is bringing investor interest rates and finance charges in line with those offered to owner-occupiers. At the same time, banks should pass on the rate cuts made by the Reserve Bank of Australia in full, PICA said.
Investors should also be able to shift their loans to an interest-only basis, which should have the same interest applied to principal-and-interest loans.
Furthermore, PICA said it is also crucial for lenders to provide an interest-free repayment holiday.
Investors might also benefit from tax depreciation breaks, which will enable them to claim the actual remaining depreciation on the remaining life of an asset.
Kingsley said these measures are "sensible help" that can assist landlords to afford to accommodate rental losses.
"Property investors have already been subject to challenges in terms of securing finance and lose of their ownership rights through changes to state-based legislation. They simply are not in a position to be asked, yet again, to carry the load unassisted," he said.
Furthermore, Kingsley said it would not help to accuse landlords of being "unsympathetic" and "unwilling" to fulfill their roles in providing safe housing.
"The silver lining of this current event is a greater realisation across the board that tenants and landlords must treat each other with mutual respects and help each other through tough times," Kingsley said.
Ken Morrison, chief executive of the Property Council, said in an earlier statement that property owners need support from state and territory governments to be able to assist their tenants.
“State and territory governments should provide land tax relief — legislated so that it must be passed through to tenants — then that can help support struggling tenants. Land tax is typically the highest outgoing that tenants pay, so temporary relief would help," Morrison said.
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