A " Rent Strike " Looms !

There is no question that this Coronavirus pandemic has prevented hundreds of thousands of workers from gaining their usual pay packet because of the forced closure of their employer and the government has stepped in with compensation payments to try and fill that gap.  Another relief measure has been a ban on evictions to protect people renting from being forced onto the street while this interruption to employment lasts.

The government has made it clear that this is a time for negotiation between tenants and their landlords. A vast number of people are still working and their pay is unchanged and that eviction ban is a safeguard to prevent hard hearted landlords taking advantage of this situation to maintain the rent flow.

A militant group of twenty-four renters in Melbourne has proposed a " rent strike " and this has quickly spread  to sixteen thousand signatories and could  become viral.  The language used to support this strike is alarming.  There are calls for an indefinite amnesty on rent and mortgage payments  until everybody has recovered from the crisis.  No debts, fines or retaliatory rent hikes for tenants and no adverse rental histories for those who do not rent.

The strike is timed to start in April and the action programme claims housing is a " right " that must be protected by law.  This is in contrast to the government position that both the landlord and the renter need to negotiate a rent reduction while this enforced absence from the workforce lasts.  It is expected that some portion of the compensation provided by the government would be used to service rent obligations.

Just as the government is providing compensation to those forced out of work, it is also providing compensation to the owners of rental property.  Landlords will be given a discount on land tax. In NSW this equates at a saving of $4356 a year on a million dollar property or eight weeks of Sydney's median rent of $525 each week.

The danger is that this rent strike proposal may be taken up across the board and cause the collapse of the entire rental industry.  The fact that the strike also applies to mortgage payments and this could cause the collapse of the banking system.  It is the integration of the money system as we know it that supports the entire economy.

That is the weakness of the Facebook age. An idea like a rent strike can be as infectious as the Coronavirus and if rent and mortgage payments come to a stop in Australia the entire apparatus of government collapses.  A rent strike would have great appeal to many people who have no idea of exactly what they are setting in motion.  Perhaps an orderly end to this Coronavirus pandemic depends on this rent strike not taking common sense out of the equation !