COVID-19: New government support for landlords and tenants

15 Apr 20

In response to the ongoing COVID-19 Pandemic, on 15 April 2020 the Government announced new measures to support commercial landlords, tenants and property owners with mortgages.

These changes are summarised below.

Commercial lease cancellation

Under the Property Law Act 2007 (Act) in its current form, a landlord of commercial premises can only cancel a lease for non-payment of rent when the following conditions are met:

  • the rent is unpaid for not less than 10 working days;
  • the landlord has served a notice to the tenant advising of the unpaid rent that specifies a period of not less than 10 working days to pay the rent; and
  • at the expiry of the notice period, the tenant has not paid the rent.

Currently the above two 10 working day periods can run overlap and run at the same time.  Under the proposed changes, each 10 working day time period above will be extended to 30 working days. It is unclear if the new 30 working day periods will also be able to overlap and run at the same time – and this will need to be confirmed in the final version of the Bill.

These changes will allow a tenant more time to catch up on late or missed rent payments, or come to an agreement with its landlord, before its landlord can terminate the lease.

Mortgaged land

To assist property owners with mortgages, the Bill will also extend the time that mortgage payments must be overdue before lenders can take possession of, or sell, mortgaged land. Lenders must currently give 20 working days’ notice to borrowers before taking possession or selling a mortgaged property. The proposed Bill will extend this notice period to 40 working days. This extension applies to all mortgages of land – including mortgages of commercial and residential property.  However, the Government anticipates that mortgage holidays are likely to be the “first port of call” for residential home owners (mortgage holidays for residential home owners were introduced by the Government on 24 March 2020).

Temporary measures

The above changes to the Act are a temporary response to COVID-19. The Government has indicated these temporary changes will end six months after the expiry of the Epidemic Preparedness (COVID-19) Notice 2020.


The Government intends to introduce a Bill enacting these changes on 27 April 2020. The Government has indicated that these changes will apply retrospectively and the Bill will contain further detail about how this will work. We will continue to keep you updated once the Bill passes into law.


Want to know more?

For more information on these changes, please contact our specialist Commercial and Residential property Team.  [This article is accurate as at 15 April 2020]


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