REIA welcomes extension of deferral period

by Duffie Osental13 Jul 2020

The Real Estate Institute of Australia (REIA) has welcomed the banking sector’s “new phase of support as the six-month loan repayment deferral period draws to an end.”

Earlier this week, the Australian Bankers Association (ABA) announced that banks may extend the six-month loan deferral scheme by another four months for customers with “reduced incomes and ongoing financial difficulty due to COVID-19.”

“Supporting homeowners during this phase where they may be finding it difficult to continue paying their mortgage, is to be applauded,” said Adrian Kelly, president of REIA.

“If owners and landlords are supported, then tenants, some of whom are from the most affected industries through COVID-19, are also supported. As the September deadline draws nearer, the banks have made a sensible decision to give homeowners a bit more breathing space, for those who need it, to work with the banks and get them on their feet financially.”

Kelly added that the government will still need to “consider further rent subsidies post-September in order to ensure that tenants who have lost employment are not evicted.”

The REIA, according to Kelly, has also put forward recommendations to the government to assist the real estate sector and renters to “continue contributing to the economy as it recovers from the pandemic” – including a momentary pause on stamp duties.

“The government could go further in their support of the economy through the real estate industry by abolishing or temporarily ceasing stamp duties on residential property. An abolition or temporary concession on land tax would also help stimulate an economy in recession,” said Kelly.

Kelly added that a “healthy property sector has been a crucial support to economic growth over the past three years.”

“For this the banking industry is to be commended for their continuing support of current homeowners, landlords and tenants. It is hoped the Government will also consider a stimulus to the sector to boost expected low levels of unemployment and address growth in the Australian economy,” said Kelly.