City Hub

Coalition leaves tenants swinging

Hugh Scott received a letter from landlords Sweet Potato warning “For anyone thinking this moratorium is a chance to NOT pay rent, your [sic] are gravely mistaken and you need to check your facts before making this kind of assumption…”

By WENDY BACON

On March 30 the NSW Parliament passed an emergency law granting the NSW government the power to place a moratorium on evictions. But before it can come into an effect, the government needs to introduce new regulations under existing laws. So far, the Gladys Berejiklian government has failed to take action.

The original COVID-19 Emergency Measures Bill included nothing for housing or homelessness. But NSW Greens Housing spokesperson and Newtown MP Jenny Leong then worked with the Tenants’ Union of NSW on an amendment to fix what she described as a “massive oversight”.

The Greens moved the amendment in the NSW Upper House and it passed, despite the opposition of LNP and One Nation MPs. It was then supported by the government in the Legislative Assembly.

At the end of March a 10,000 strong #NoEvictionCovid-19 petition supported by more than 100 organisations was sent to the Prime Minister Scott Morrison. It called for a National Eviction Moratorium, which resulted in the National Cabinet announcing a national moratorium. At the time of writing, only Tasmania had taken action to put this into effect.

Tenants Union of NSW spokesperson Leo Patterson-Ross told City Hub that the organisation had received many complaints from tenants about landlords demanding rent, even if they were unemployed. Some landlords who had agreed to rent discounts last week have attempted to reverse them after the announcement of the Job Seeker and Job Keeper wage subsidies.

In the meantime, some landlords, real estate agents and property managers have sent intimidating letters to tenants who are anxiously waiting to see what a six-month ban on evictions and calls for rent relief will mean for them.

In late March, two tenants who had lost their jobs, one of whom is an international student who is entitled to no benefits, negotiated a 20% reduction for two months. After the Morrison government’s Jobseeker announcement, they got a phone call from their agent telling them the reduction was cancelled.

Sweet Potato not so sweet
Residents in scores of properties managed by Sydney share house provider Sweet Potato Living received an aggressive email from the company this week. Addressing them as ‘housemates’, the letter began on a positive note, “Our hearts are with each of you as we all are facing a challenging time but together, by following the strict guidelines from our government, we will overcome this virus.”

The focus then moved quickly to finances: “We are all under financial stress right now, especially Sweet Potato Living in managing this crisis both internally and externally.”

In relation to the National Moratorium on evictions, the writer continued with caps for emphasis: “For anyone thinking this moratorium is a chance to NOT pay rent, your [sic] are gravely mistaken and you need to check your facts before making this kind of assumption. The goal of our government through this period is to provide government assistance (to those who need it) so there is a continual flow of money in our economy…. Below we will outline VERY clearly what steps YOU need to be taking in order to remain within the property you are currently living in.”

Australians who had lost their jobs are instructed to “take steps to ensure your rental payments continue to be made” by “immediately seeking casual work in whatever capacity you can for the moment (go into survival mode)” and apply for Centrelink. Anyone is not going to take these steps should “move back with close friends or family over this period.”

But for the non-Australians who are not entitled to government assistance, the advice was even harsher: “To NON Australians who are still employed or have financial assistance from overseas absolutely nothing changes, your rent is still expected to be paid on time, each rent cycle. To NON Australians who have lost their jobs and have no financial assistance from overseas. Whilst it pains us to say this, you will not be getting support at this stage from our government so you should be doing whatever you can to catch the next available flight home to your country of origin… If you are from another country and have lost your job and have waited this long, YOU ARE BEING IRRESPONSIBLE FOR DOING SO!!!! Go back home to your friends and family and live through this crisis with their support.”

The letter writer signed off with cheery farewell, ” Stay Safe”

Sweet Potato Living has advertised itself until now as the Number One share house manager in Inner Sydney. Their clients are mostly investor landlords who pay the business a commission to rent rooms in three or four bedroom furnished houses for up to $400 a week for each room.  Many tenants who received this email already struggle to pay high rents. If they have not been stood down or sacked themselves, they know people who have been.

This letter attracted attention after tenant Hugh Scott posted it on the Facebook page of Inner West Mutual Aid. Scott explained to the page followers that he did this because it was “definitely fear-driven and aggressive, as I was reading it, I couldn’t believe they wanted to handle it like this. I’m worried about seeing much more of this too, that’s why I wanted to share it.”

Another Mutual Aid supporter described how his partner, who has lost her income and is entitled to no income support because she is not an Australian resident, rang him upset and crying after reading email.

After the letter was posted online, a Mutual Aid follower emailed Sweet Potato Living operations manager Arnaud Greiveldinger asking him if the email was a hoax. Very shortly afterwards, the Sweet Potato Living website, Twitter, Linkedin and Instagram accounts were taken offline. It was no longer possible to contact Greiveldinger or the company.

According to a job seeker site, the Sweet Potato Living operations manager is paid $85,000 to manage the share houses and, depending on the company’s success, can earn bonuses.

Unable to contact Greiveldinger, City Hub used the Australian and Securities Commission database to identify the owner of Sweet Potato Living, which is Gamboss Pty Ltd, of which Avalon resident Roger Gambotto is the sole director. Co-owner is artist Joanna Gambotto who runs Sweet Potato Ceramics.

City Hub rang Joanna Gambotto and asked to be put in contact with Roger Gambotto. “No Comment,” she said and hung up. The Gambotto’s live in their own home on the Northern Beaches, which is mortgaged to the Westpac Bank.

The Inner West Mutual Aid Facebook discussion alerted the media and by Thursday morning, both Buzzfeed and ABC’s RN Breakfast had reported the story.

Greens MP Jenny Leong told City Hub that Sweet Potato’s behaviour highlighted the urgency of the situation. “Discrimination and vilification is not a new thing in the area of rental housing but this latest incident doesn’t make it less damaging. This communication shows how urgent it is for the NSW Government to act on the Prime Minister’s announcement that there will be a moratorium on evictions and also make it clear that this kind of behaviour by landlords is unacceptable,” said Leong.

Housing affordability crisis exacerbated
The current COVID-19 crisis is exacerbating an entrenched housing affordability crisis in Sydney, which leaves residents exposed to unfair and ruthless conduct by landlords. Many landlords themselves will now be under pressure to make loan payments as their incomes fall and properties lose value. Leong says the best way to protect the landlords is for tenants to receive a rental subsidy so they can continue to pay rent.

In researching this story, City Hub came across a wide range of actions taken by landlords, some of whom have directly contacted tenants to tell them that they will reach arrangements to reduce rent by up to 50% or even freeze rent altogether. But real estate agents are another factor: some have told landlords that they won’t approach tenants to offer them reassurance or reductions.

The big issue worrying tenants is what will happen to them after the ban is lifted, and whether they will be forced to pay arrears which many are unlikely to be able to do. This future is especially worrying for tenants in NSW who can be evicted by their landlords on ‘no grounds’ at all.

One of Australia’s biggest real estate agents sent an email to tenants stating that assistance would be available on a case-by-case basis but that breach notices and data collection of arrears would be kept on records. “It’s a delay only of eviction notices and “any arrears will remain a debt to be paid when you are able to do so.” They suggested tenants could draw on their superannuation if in difficulties.

One tenant who has rented his property for three years but is currently unemployed showed City Hub the email, which he found intimidating. The corporate regulator ASIC today warned the real estate industry that the offering  financial advice about the use of superannuation by unlicensed persons is illegal and it “will not hesitate to act quickly to protect vulnerable consumers.”

Every week in NSW, there are scores of evictions, which means that some tenants are facing homelessness right now. While tenants wait anxiously for the NSW government to implement the moratorium, Leong has also called for all current eviction notices to be invalidated.

“A moratorium on evictions is a crucial step – but more needs to be urgently done. A moratorium without direct financial support to renters is only pushing the problem further down the road.”

“We know that many renters have lost their income, so the last thing they need is to be living with the reality of an ever-growing rental arrears debt. At the end of this pandemic, it isn’t acceptable for people who rent to be left with huge and unserviceable debts – all this does is kick the homelessness problem down the road. If significant amounts of direct financial support can be handed out to big business and banks in this current crisis, then there is no excuse for not also providing direct financial support to renters.”

NSW Tenants Union’s Leo Patterson-Ross said that tenants are concerned that if they resist demands to pay rent, they will be ‘blacklisted’ in the future. “Even before this there was a crisis of renters in Sydney, so this is only highlighting and exacerbating existing problems.”

Currently, tenants can be blacklisted on databases without landlords providing real evidence. If and when tenants find out, they have to apply to New South Wales Civil and Administrative Tribunal for an order to have their name removed. The Tenants Union argues that the system does not operate well during normal circumstances and will be ripe for abuse without government intervention now to prevent listings. Like Leong, Sullivan is arguing that “the only way to prevent this is for the Federal government to subside rents now so that tenants don’t fall into arrears.”

No security
So far, the National Cabinet seems to be more interested in providing certainty for commercial tenants, leaving residents to fend for themselves. The Minister for Housing Michael Sukkar suggested this week that tenants and landlords would be asked to work out arrangements for themselves.

While they may work out for some tenants, it would leave residents in an unsafe and precarious situation as thousands of big and small landlords, property managers, real estate agents and marketers struggle to survive a crash in the property market. Behind the scenes, the property lobby which has long held huge sway in NSW will be applying pressure.

And while most tenants are only too willing to negotiate, it is little wonder that there are rumblings of rent strikes.

On 3 April, Greens NSW Senator Mehreen Faruqi posted a message on her Facebook: “Unbelievable. Still no rental and mortgage holidays for residential tenancies, still no ban on foreclosures, still no boost to rent assistance payments. The government needs to get its act together.”

 

Wendy Bacon was previously the Professor of Journalism at UTS. She tweets at Wendy_Bacon and is also on Signal. If you have more information, please contact her. She blogs at www.WendyBacon.com

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