The Palaszczuk Government’s proposed COVID-19 protections for tenants have come under fire for forcing mum and dad investors to foot the bill for losses from renters they will be banned from evicting.

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Mass opposition is building towards the plan, which the real estate industry’s peak body in Queensland warned would mean landlords would not be covered by insurance for rent losses nor would they be able to use usual channels to get that money back post-COVID-19.

REIQ warned tenants would also be able to ask for rent reductions without proving financial hardship, deny entry to properties and have automatic six-month extensions on leases, which would lead to the financial burden on landlords stretching to 12 months.

Among those calling for action is Real Estate Industry of Australia life member Simon Pressley who said: “The same Queensland state government that started a process late last year to try and strip several fundamental rights away from asset owners is now only a few days away from passing new legislation which essentially means that, among other changes, owners of Queensland investment properties will be expected to write-off some of their rental income.”

In an open letter to landlords, the Real Estate Institute of Queensland warned landlords would “foot the bill” for government plan that’s been backed by Premier Annastacia Palaszczuk.

“As the peak body for real estate in Queensland, we support the need for tenant protection during COVID-19 however, we are fundamentally opposed to some of the proposed measures. You should be too. As a landlord, you will ultimately foot the bill if the following proposals are introduced,” the letter stated.

It called for the industry to mobilise opposition to the plan urgently “before parliament sits to pass these protections on Wednesday, April 22.”

REIQ warned that under the plan, any rent reduction negotiated with tenants during the coronavirus period “is a permanent rent waiver meaning you, as the landlord, will be out of pocket, with no means of recovering any unpaid rent in the future post COVID-19”.

“Your tenant/s will NOT have to pay back any rent.”

It also warned that landlords would not be allowed to ask tenants for any proof of financial hardship.

“Your tenant/s can request reduced rent due to COVID-19 without any proof. This potentially exposes you to false claims and exploitation of the proposed protections for those who genuinely need it.”

REIQ also warned that “landlord insurance will not cover you for rent in arrears”.

“The normal terms of your policy won’t cover the rent reduction as this is a mutual agreement between you, as the landlord, and your tenant and you cannot follow the necessary rent default process as this is prohibited”.

The body has called on landlords to crosscheck with individual insurers on policy conditions.

“Your tenancy agreement will immediately extend by six months if it expires during the six- month freeze on evictions. Tenants will be automatically entitled to a six-month extension of the tenancy agreement meaning any protections may last up to 12-months.”

“Your tenants can refuse entry for anything other than emergency repairs. Not only can your tenant refuse access, they don’t have participate in virtual property inspections either. There’s also no clarity as to whether prospective purchasers can inspect a property that is for sale.”

“Your tenants can break a lease with only seven days’ notice. To make matters worse, you cannot recover any lost rent or costs associated with finding a new tenant as would normally apply.”

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