City of Kwinana selling ratepayers’ houses to recoup unpaid rates in extreme action

Under the Local Government Act, councils can sell ratepayers’ properties to collect outstanding rates — but one Peel area has attempted to sell nearly 50 homes in the past five years, more than four times that of any other metropolitan council. The City of Kwinana has resolved to sell 47 properties since May 2019, which they can legally do if there is an outstanding balance spanning more than three years and court action has been unsuccessful. Despite only three other councils in the Perth and Peel region taking the extreme action over the past five years, Kwinana chief executive Wayne Jack believed his residents were not financially worse off than ratepayers in other areas. “The decision to sell properties is not one that the city takes lightly,” Mr Jack said. “Such actions are always a last resort, following exhaustive efforts to work with property owners to resolve unpaid rates. “The City of Kwinana operates within a framework of fairness and due diligence, adhering to the Local Government Act, which mandates the recovery of unpaid rates to maintain the equitable distribution of tax burdens among residents.” In the same period, the City of Cockburn resolved to sell 12 properties and actually sold three, with another three sold by a court bailiff using a land property seizure and sale order. The City of Mandurah sold one property under the Act, as did the City of Bayswater. Of the properties Kwinana resolved to sell to recover unpaid rates, 33 paid their account in full, eight are on payment arrangements and four were sold by auction. Two were recently advertised for sale but the owners are now on repayment plans. Rockingham Mayor Deb Hamblin said the city had not disposed of any properties that way during the period and would use “all available means to avoid selling properties,” calling it “the least preferred method of recovering unpaid rates”. Mr Jack said the marked difference in the number of properties sold between councils was “not necessarily reflective of the financial wellbeing of Kwinana residents”. “Multiple factors contribute to this outcome, including but not limited to the economic landscape of the region, property market dynamics, personal reasons of property owners and the effectiveness of the city’s rates recovery processes,” he said. “The city is committed to supporting our community members facing financial hardships. “We have a robust hardship policy and offer various payment arrangements and support services to assist residents in managing their rates. Our aim is always to find a resolution that avoids the sale of property.” “We are continually analysing the underlying factors contributing to the need to sell properties for unpaid rates, ensuring our approach remains both sensitive to the residents’ needs and responsible to the community as a whole.” Salvation Army financial counsellor Sarah Feek said it was uncommon for councils to come after people’s properties to recover rates but it was never too late for help. “From our experience, it is quite rare for a council to commence legal proceedings against a property owner to recover rates,” she said. “And even when legal action has commenced, it’s not too late to seek support and try to negotiate a payment arrangement.” Ms Feek said financial counsellors were seeing “significant financial hardship” across all regions and encouraged people to seek help as soon as possible. “Depending on the situation, we can often advocate and negotiate arrangements with councils which may prevent or stop legal action, and ultimately repossession of the property,” she said. “In our experience, legal action is a last resort for councils. “That’s why it’s really important to let councils know if you are struggling to pay your rates, and to contact a financial counsellor if needed.”