On April 7th, the Government issued a Mandatory Code of Conduct for Commercial Properties. They are still to issue a code in respect of residential premises.
The Code is, in my opinion – very disappointing – it provides a prescriptive approach that will help tenants (which is necessary and important), but provides no support to the owners – it is almost like the Government believes that if you own property for lease, you are wealthy and don’t need support (the document is also 7 pages in length!)
Incentives have been provided to business tenants, in the form of cash back, JobKeeper, Payroll Tax remission and (for those with available reserves) depreciation incentives. The only incentive afforded to the property owner is a loan repayment deferral.
I believe there has been no thought that an owner may actually need rental income to live on.
The Code applies where the tenant qualifies for JobKeeper – meaning they have suffered a reduction in turnover of more than 30% (we are awaiting legislation on how this will be measured).
Whether the Code applies or not, I recommend both parties of the lease recognise that in the present circumstances, neither party is at fault – as such you should discuss the issues together to try and find a workable solution for both parties. The aim should be to retain the tenancy for the longer term.
Some key issues to note:
Issues both parties should consider:
So what does the Code prescribe?
If any of these issues affect your specific circumstances and you would like to discuss these matters further, please contact our office on firstname.lastname@example.org.
– Ian Hogbin
This article is compiled as a helpful guide for your private information and is subject to copyright. We suggest that you do not act solely on the basis of material contained in this article because items are of general nature only and may be liable to misinterpretation in particular circumstances. We recommend that our advice be sought before acting on any of these crucial areas.