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Residential tenancy disputes ‘cracking’ under COVID-19 pressure

finance-advice
1 minute read

Residential tenancy disputes ‘cracking’ under COVID-19 pressure

by Emma Ryan 01 September 2020 1 minute read

The process for dealing with residential tenancy disputes is cracking under the weight of COVID-19, according to a Victorian real estate body.

Residential tenancy disputes ‘cracking’ under COVID-19 pressure
September 01, 2020

The Real Estate Institute of Victoria (REIV) has issued a statement noting its concern that the process is falling short of what it should be.

“With less than one month to go in the original six-month moratorium announced by the Andrews’ government, there is a backlog of 4,000 rental cases at the Victorian Civil and Administrative Tribunal (VCAT) and nearly a thousand disputes still to be resolved through the Dispute Resolution Centre Victoria (DSCV) process,” the REIV’s statement read.

“Consumer Affairs Victoria (CAV) has referred more than 8,700 matters to VCAT and only about half of those have been finalised. More cases are being referred weekly to the tribunal than are being listed for hearing.  

“The pressure on the tribunal members to get through the ever-increasing case load is creating a bias in the system, with reports that property managers acting for landlords are being told they cannot speak during the hearing due to time limitations.

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“The DSCV is not faring much better, with more than a third of the 2,800 cases referred to it by CAV still active. To their credit, they have recently increased the number of dispute resolution teams to deal with the backlog, but that is too little too late.”

The comments come after the REIV told the state government in May that resources devoted to dealing with the dispute cases were “inadequate”.

“With the extension of the moratorium by more than three months to the end of the year, these backlog numbers are likely to get much worse, with many cases still unresolved at the end of the moratorium,” it added.

Further, the REIV explained that many tenants “simply refuse” to provide information or even communicate with their landlord or agent to expedite a speedy resolution.

“Nearly 32,000 rent reduction agreements have been lodged with CAV, with tens of thousands more being worked out by mutual agreement, meaning they do not have be recorded at CAV,” the REIV said.

“Some opportunistic people are taking advantage of this system overload by simply refusing to pay rent or negotiate, resulting in massive arrears in rent being borne by the property owner with little likelihood of it being repaid.”

Commenting further on the issues, REIV CEO Gil King said:

“Even when VCAT makes an order, they are often not enforceable until after the end of the moratorium period, which is now a further three months away. This means that property owners are left in an untenable situation where they cannot protect their investment.”

“It is totally unacceptable to have a system that was meant to assist in negotiations has thousands of unresolved disputes.”

REIV president Leah Calnan added:

“Many tenants are getting a free ride knowing that they cannot be evicted. The system must be fair to all – owners and tenants.”

“The bias in the system is plain to see, with the balance of power clearly in the favour of tenants knowing they cannot be evicted until the new year.”

Residential tenancy disputes ‘cracking’ under COVID-19 pressure
Residential tenancy disputes ‘cracking’ under COVID-19 pressure
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About the author

Emma Ryan

Emma Ryan

Emma Ryan is the deputy head of content at Momentum Media.

Emma has worked for Momentum Media since 2015, and has since been responsible for breaking some of the biggest stories in corporate Australia, including across the legal, mortgages, real estate and wealth industries. In addition, Emma has launched several additional sub-brands and events, driven by a passion to deliver quality and timely content to audiences through multiple platforms.

Email Emma on: [email protected]Read more

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