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Property & Leasing – Your questions answered

General Advice Disclaimer

This webinar has been prepared by Navwealth Accounting Pty Ltd. Any advice provided is of a general nature and does not take into account personal circumstances. You should consider whether the information is appropriate to your needs, and where appropriate, seek further professional advice. Taxation, legal and other matters referred to in this webinar are of a general nature only and are based on Navwealth’s interpretation of laws existing at the time and should not be relied upon in place of appropriate professional advice. Those laws may change from time to time.

Presenters

Simon Prowse

Director of Navwealth Accounting

James Smyth

Principle SEA Smyth Estate Agents

Rana Stevens

Senior Property Manager & Head of Property Management

Ag Agenda enda

COVID‐19 Update SEA (Smyth Estate Agents) Introduction Rental & Leasing ‐ Residential Tenant Negotiations Landlords Rental & Leasing – Commercial (superannuation) Property Market Update SEA – the difference Q & A

COV COVID‐19 19 Upda Update te

Key Dates Updates Reporting Lack of Knowledge

SE SEA ‐ Sm Smyth yth Es Estate Ag Agen ents ts

Founded 2007 Residential Property Specialists

• Selling
• Buying
• Leasing
• Renting

Based In Freshwater on the Northern Beaches but will travel

Re Rental and and Leasing Leasing

Overriding Principles

Sharing the impact – interests of tenant & landlord Circumstances – case by case Continuity – Tenancy Good faith

Re Rental and and Leasing Leasing – R – Residential Re Regulations br brough

• ught do

down wn 15 15 April April 2020 2020

Tenants Perspective

Impacted or Non Impacted (COVID‐19)

• One or more rent paying tenants in a household
• Lost employment
• Reduction in working hours
• Work affected – illness, carer
• 25% Reduction in Household Income*

*Household income – Total of the weekly income (including stimulus) received

Re Rental and and Leasing Leasing – R – Residential Re Regulations br brough

• ught do

down wn 15 15 April April 2020 2020

Moratorium Period

• 6 months after 15 April 2020
• If impacted, landlord cannot
• Issue Termination Notice for Non Payment of rent
• Apply to NCAT for a termination order for Non Payment of rent
• Cannot black list tenant

Re Rental and and Leasing Leasing – R – Residential Re Regulations br brough

• ught do

down wn 15 15 April April 2020 2020

Moratorium Period Exemptions

• 60 Days
• Termination notice after 15 April, and
• Had good faith negotiations, and
• Fair and reasonable to give termination
• 90 days
• End of a tenancy
• Other breaches ‐ Not nonpayment of rent

Re Rental and and Leasing Leasing – R – Residential Re Regulations br brough

• ught do

down wn 15 15 April April 2020 2020

Impacted Tenant (Burden of Proof to apply Moratorium)

• Substantiation – Hardship form
• Reasonable document requests
• Tenant obligation to provide
• Steps and or timelines

Landlord/Agent document the process

Te Tenant Negoti Negotiations ns

Rental Options

• Reduction
• Rebate
• Deferral

Te Tenant Negoti Negotiations ns

Landlord Insurance

• COVID‐19 or similar not contemplated in policies
• Discuss with insurer
• Claiming insurance
• Getting insurance

Te Tenant Negoti Negotiations ns

Good Faith Negotiations

• Document all steps
• Process
• Steps

Negotiations Break Down

• Department of Fair Trading
• Mediation
• NCAT
• Document and Evidence

Te Tenant Negoti Negotiations ns

Other matters

• Rental increases
• Foreigners
• Lease break fee

Document the plan

Landlor Landlords ds

What about the owner – one sided

Land tax holiday Rental holiday Extension of lease Break lease

• Hardship – 90 days
• Sale of Property – 90 days

General Rights??

Re Renting and and Leasing Leasing – Com Commercial (S (SME Ma Market et ‐ $50m $50mill) ill)

Very similar to residential (mandatory code of conduct) – JobKeeper Leasing Principles – Landlords

• No termination of lease for non payment
• Proportionate adjustments to rent, waivers/deferrals related to trade and up to 100%, of which
• Min 50% rent waiver (unless otherwise agreed)
• Balance deferred – min 24 months
• On cost reductions passed on
• No interest and or fees and charges to apply to deferment
• Rental increases frozen for duration of pandemic

Leasing Principles – Tenants

• Remain committed to lease terms
• Allow for rental extension in line with waiver/deferral

SME Commercial Leasing ‐ Mandatory Code of Conduct (Document)

Pr Property Ma Market et Upda Update

Buyers/Sellers Market

• Changes to Processes
• Clearance Rates ‐ Demand
• Stock
• Other?

Rental Market

• Changes to Processes
• Clearance Rates
• Stock
• % Impacted Tenants (10‐25%)

SE SEA – t – the dif differ erence ence

Alerts/Updates immediately sent to landlord and tenants Regular contact Current arrears – 2.17% (Market 4‐6%) Increased density Negotiations – Who we are working for

• Owner not out of pocket
• If out of pocket can seek restitution

A Q

Simon Prowse

Director of Navwealth Accounting

James Smyth

Principle SEA Smyth Estate Agents

Rana Stevens

Senior Property Manager & Head of Property Management

15th May ‐ Covid‐19 Market Update and Strategies 22nd May ‐ Q&A

Futur Future Q&A Q&A Frida Fridays

THANK YOU!