By Sharina Ahmad
TENANTS struggling to pay their rent owing to the impact of the Covid-19 outbreak must be dealt with “sympathetically” by landlords.
The situation arises especially during the movement control order (MCO) period where millions of people will see their jobs and incomes hit by the halt of many businesses.
In a move to minimise the economic impact, Bank Negara Malaysia has ordered all banks in the country to grant an automatic six-month moratorium on loan and financing repayments to individuals and SMEs effective April 1, to ease the plight of borrowers facing financial difficulties.
Property blog Kopi & Property founder Charles Tan said the current relationship between the landlord and the tenant matters tremendously during a crisis like this.
“In this matter, both tenant and landlord need to look for a win-win situation and have good communication regardless of their own issues.
“To keep a good tenant who genuinely needs help, even up to 100% rental reduction is possible but only if the tenant is really in trouble,” Tan told FocusM.
For instance, he said tenants who have been a good paymaster with a consistent track record will not delay their payment.
“If they have been paying rent on time since the last 12 months, why would we want to lose such a good tenant? Or else, a more realistic proposal could be 50% cut because the landlord would still have to pay the mortgage plus interests after the moratorium,” he suggested.
He said managing not-so-good tenants is more straightforward. “Everything should be based on black and white. Make an agreement for deferment (just like the moratorium) on a monthly basis with reference to the MCO.”
Strategic marketing consultancy firm REI Group CEO and co-founder Dr Daniele Gambero believed this pandemic should teach everyone to take on their fair share of the pain and breathing space for adjustment.
“Since all banks are offering a moratorium for six months on all mortgages, the rental discount should be looked at as a small help, not to the tenants but the country to stand up again strong and united until the end of the MCO.
“Besides, the government is also rewarding landlords who are willing to concede a temporary rebate to their tenants with a tax discount. I’m myself a landlord and a tenant. I’ve decided to give the rebate and hope my landlord will do the same,” Gambero told FocusM.
Nawawi Tie Leung Property Consultants Sdn Bhd executive director Brian Koh said it will be mutually beneficial to ensure the survival of both parties.
“Of course the negotiation strengths of the parties are not equal but they need each other to recover. Everyone is out of pocket for the duration of the MCO, and after this staring at a recession. So we have to ‘give and take’.”
According to a news report dated April 6, a coalition group called Marginalised Community Support Group has suggested that property landlords consider a temporary rent waiver for low-income tenants or those who have lost their job due to Covid-19.
The coalition said the government should help subsidise the waiver by providing some compensation to landlords who choose not to collect rent temporarily from their tenants.
It highlighted one of the many difficulties that those in the low-income group or who earn daily wages are facing — they have no income as they have to stay home during the MCO and they are in danger of not having a roof over their heads. — April 7, 2020
