Real estate agents tell renters to access superannuation to pay rent

Scott Morrison has urged landlords to do right by their struggling tenants as the economic fallout of the COVID-19 crisis continues.

Prime Minister Scott Morrison has called on commercial landlords to “do the right thing” as Australia reels from the coronavirus pandemic.

Speaking to the press this afternoon, Mr Morrison said a mandatory industry code of practice for commercial rents was just days away, which would then be incorporated into state and territory legislation “where appropriate”.

While the fine print is still being finalised, Mr Morrison said businesses which had taken a financial hit as a result of the coronavirus disaster would be able to negotiate new lease terms with their landlord, which could include a temporary rental waiver or an extension of the overall lease.

He urged landlords to “do the right thing” by their tenants as the pandemic wreaks havoc on the economy.

However, he stopped short of commenting on the matter of private, residential leases which has been a hot topic of conversation today after it was revealed some rogue real estate agents had told tenants experiencing financial hardship as a result of the COVID-19 pandemic to pay the rent using their superannuation.

The Federal Government recently announced a new policy to help Australians struggling through the coronavirus crisis which would allow eligible taxpayers to access $10,000 of their superannuation this financial year, and another $10,000 next financial year.

However, the Australian Securities and Investments Commission (ASIC) has specifically condemned this advice, warning agents that pass on that message they could be risking fines or even prison time.

RELATED: $5k virus tax loophole you should know

RELATED: Coles lifts buying restrictions

But that hasn’t stopped some agents, with a news.com.au reader from NSW sharing a “very disappointing” email they received from their agent after they requested a rent reduction in light of the public health emergency.

The email to the renter stated that tenants and landlords were both doing it tough and that the renter should apply for government assistance or to withdraw their super early first before the request was passed on.

But ASIC has written to real estate institutes across the country, warning such requests regarding superannuation could be a breach of the Corporations Act which could lead to large fines or up to five years behind bars.

Earlier today, Labor leader Anthony Albanese called out the actions of certain real estate agents in the midst of the devastating coronavirus crisis and called for greater clarity regarding renters’ rights.

He urged the Morrison Government to adopt Labor’s policy of freezing evictions during the crisis.

Opposition Leader Anthony Albanese has slammed the actions of some agents. Picture: AAP Image/Joel Carrett

The Labor leader said Shadow Assistant Treasurer Stephen Jones had also previously contacted the Australian Securities and Investments Commission (ASIC) to report that some real estate agents had been telling renters who had difficulty paying their rent that they should use their superannuation to cover it.

“ASIC had put up a letter to real estate agents on the front page of their website … indicating that it could well be illegal because this is inappropriate financial advice, for which real estate agents are simply not licensed to do. Not only is it financial advice, it will be bad financial advice because Labor has pointed out our concern with the super arrangements,” Mr Albanese said.

“When you have the bottom of the market as we are seeing at the moment, it is not in (an individual’s) interest to take this out because it will lead to much lower retirement incomes and our concern is also there for the superannuation industry which may well be forced to sell assets at the bottom of the market, which is not in Australia’s national interest nor in the interest of the members of those funds. So, we take this issue very seriously indeed.

“The truth is that the more people who stay at home, the better the health outcome and therefore the better the economic outcome as well.”

Mr Albanese said most agents were doing the right thing, but co-operation was needed.

“We are all in this together, and that is why (it) requires government, private sector, people who are dealing with these difficulties to negotiate out sensible outcomes that are in the common interest,” he said.