News

Greater Shepparton rental market on brink of disaster unless subsidies offered

By Charmayne Allison

The local rental market could be on the brink of disaster if the Federal Government does not seriously address tenancy issues, as widespread job losses see renters struggle.

Your Sold Real Estate senior property manager Tara Seach said economic strife could set off a "domino effect", destroying the local real estate market.

“Many locals are already losing jobs. Tenants can't pay rent, which means landlords can't pay their mortgage, which ultimately means our management fees don't get paid,” she said.

“We need more reassurance. We’ve been waiting for the announcement of a stimulus package for rent subsidies, to help tenants who are in strife.

“We have heard Scott Morrison is addressing it later this week. But we need clarity around whether the government can supply this and if so, when.”

While Ms Seach said the number of tenants struggling to pay rent was still quite low, it was only the calm before the storm.

“It's not that drastic at this stage. But so many people are being left in limbo, holding their breath for what comes next,” she said.

“Those who are already feeling rental stress are very down and uncertain about the future.

“I wish we could freeze rent, but our hands are tied. It's just not practical.”

Ms Seach said landlords were already investigating offering rent reductions to struggling tenants.

“A couple have contacted their banks to see if this could be a practical option,” she said.

“But of course, many could be in a financial situation where they just couldn't offer that.”

Most real estate agents rely on management fees as their main source of income, particularly as the property market hits a slump.

“At the moment not many people are buying houses, so we have no income there,” Ms Seach said.

“So if there are no management fees, we will have nothing. With no real estate industry, there's no maintenance of homes.

“And even if rent and mortgages are frozen, body corporate fees, land rates and insurance for units will still need to be paid.

“And tragically, this could leave many people without homes, as banks will take over houses if rents and mortgages don't get paid.

“So there could be a massive domino effect.”