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Rents and landlords


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#1 But seriously

Posted 30 March 2020 - 08:52 AM

New announcement - will this be good news for anyone?

#2 Amica

Posted 30 March 2020 - 09:03 AM

They've made an announcement without any details and without any financial support. 'Work it our between yourselves' is laughable.

Every time someone says 'but landlords can just freeze their mortgage', a kitten dies.

#3 MooGuru

Posted 30 March 2020 - 09:41 AM

Well we requested a rent decrease in mid Jan as the REA was chasing us to sign a new lease and rent has dropped a significant amount in our area and we were already paying at the very top end of market value previously.
Nothing.
Our lease expires mid April. We can't even get an answer if they are willing to negotiate. The REA was chasing us multiple times a week to sign at the higher price from December on. Since we requested the rent decrease we've heard nothing. Our emails don't get responsed to. Calls are met with "someone will get in touch" then silence.

So you know in my experience of 20ish years renting, negotiation has always been "do as the REA demands or be threatened with eviction/rent increase" and I suspect that isn't going to change easily now.

#4 born.a.girl

Posted 30 March 2020 - 09:45 AM

I can't see any reason why vacancies wouldn't increase from now on.  Younger people are moving back in with their parents, if they can (as per article in today's Age), and airbnb operators are apparently looking to rent out longer term given the short term market has dried up.

With more vacancies, comes less power to the owners, and more to the renters.

#5 Holly298

Posted 30 March 2020 - 09:54 AM

We’ve had a lot of landlords thinking of selling as they have lost their jobs and can’t afford to keep the investment property any more, I think this will happen a lot over the next 12 months

our property managers have been told not to reply to any tenant or landlord officially until we have official instructions from the real estate institute and fair trading - no leases or any agency agreements have these clauses in them so to keep the insurance companies happy (the landlords and our professional indemnity) we have to make sure everything is done legally (which is bloody hard as they still haven’t said exactly what procedures we need to follow)

#6 Amica

Posted 30 March 2020 - 10:05 AM

I feel sorry for property managers Holly. Are you one?

With no rent coming to landlords, you won't receive your fees, but will be expected to be a free mediator between parties.

I don't see how they can do this legally to be honest. The government are going to have to do a lot better than say 'work it out between yourselves'. They need to guarantee rents out of their coffers. Rent assistance is a joke. Rent assistance doesn't even have to be spent on rent!

#7 lozoodle

Posted 30 March 2020 - 10:06 AM

I'm interested to see what happens to landlords who will have tenants not paying rent due to financial hardship - i.e. will the banks put a hold on their repayments because its not going to bode well if they don't....

What happens then, the owner can't make repayments, and end up losing their property as a result or have to sell it to make ends meet. What happens to the tenant then?

I think they need more clear information about how this is going to work as without all parties being on board, it wont work.

#8 #YKG

Posted 30 March 2020 - 10:13 AM

Banks said over a week ago that they are granting 6 month “holidays” on mortgages, owners have that option if they need it.

My understanding is that you can’t be evicted for next 6 months, but it goes without saying that tenants should be talking to their agents or landlords. I rent, this morning my property manager called to query if I’m likely to go into financial hardship due to COVID, I’m fortunate that my job is guaranteed, my income is guaranteed. I assured her lll still pay rent as normal, she seemed relieved.

I’m fortunate that I have savings behind me, in the event I can’t work for 3 months I still have money to keep me afloat. Not a lot of people have that.

#9 lazycritter

Posted 30 March 2020 - 10:23 AM

Isn't the moratorium on commercial leases only?

Sorry my mistake it's not moving on

Edited by lazycritter, 30 March 2020 - 10:28 AM.


#10 #YKG

Posted 30 March 2020 - 10:26 AM

 lazycritter, on 30 March 2020 - 10:23 AM, said:

Isn't the moratorium on commercial leases only?

Last night he mentioned no evictions for residential and commercial but seemed to waffle on about commercial properties a lot and those landlords making sure business can reopen when permitted to.

#11 Amica

Posted 30 March 2020 - 10:27 AM

To call it a 'holiday on your mortgage' is a bit deceptive. If your mortgage is $2000 a month, at the end of 6 months you owe an additional 12k on your house plus compounding interest. It's a dreadful way out. Plus it is unclear at this stage if it effects your credit rating. Landlords have been told by banks that to do it, their interest rate will go up, and/or they have to break fixed mortgages etc.

There is also no 'holiday' on rates, water, insurance, maintenance etc.

#12 Hands Up

Posted 30 March 2020 - 10:35 AM

^^^^ yep.

#13 #YKG

Posted 30 March 2020 - 10:35 AM

 Amica, on 30 March 2020 - 10:27 AM, said:

To call it a 'holiday on your mortgage' is a bit deceptive. If your mortgage is $2000 a month, at the end of 6 months you owe an additional 12k on your house plus compounding interest. It's a dreadful way out. Plus it is unclear at this stage if it effects your credit rating. Landlords have been told by banks that to do it, their interest rate will go up, and/or they have to break fixed mortgages etc.

There is also no 'holiday' on rates, water, insurance, maintenance etc.

Maybe people shouldn’t be buying investment properties unless they have a large buffer behind them. I don’t tend to feel bad for people who buy investment properties without appropriate buffers.

#14 Holly298

Posted 30 March 2020 - 10:36 AM

We only were able to get 3 months freeze in our mortgage , we applied this morning so not all banks are doing 6 months

Yes, it’s been a nightmare for our property managers as they are getting stress calls from both tenants and landlords , and yes as pp said we get paid from the rent collected , no rent means no income for the office so we are all in a frenzy working out how to help our clients and keep the office running ( I’m in sales not property management )

#15 Holly298

Posted 30 March 2020 - 10:39 AM

 #YKG, on 30 March 2020 - 10:35 AM, said:



Maybe people shouldn’t be buying investment properties unless they have a large buffer behind them. I don’t tend to feel bad for people who buy investment properties without appropriate buffers.

That’s not fair - I’ve got landlords who do have small buffers but no one could predict your business/livelihood being closed down and literally no income coming in so their savings have gone into their own mortgages, family, staff and basic needs

#16 #YKG

Posted 30 March 2020 - 10:43 AM

 Holly298, on 30 March 2020 - 10:39 AM, said:



That’s not fair - I’ve got landlords who do have small buffers but no one could predict your business/livelihood being closed down and literally no income coming in so their savings have gone into their own mortgages, family, staff and basic needs

Banks and RBA literally tell investors that they need a buffer in the event of loss of income/illness/injury etc.

It’s a 100% fair, if you are unable to work for any reason and know that if something was to occur you couldn’t afford the investment, then don’t buy it. If you can’t comfortably service your own mortgage and an investment property without a buffer you have over extended yourself. That’s on you.

#17 hills mum bec

Posted 30 March 2020 - 10:45 AM

 #YKG, on 30 March 2020 - 10:35 AM, said:

Maybe people shouldn’t be buying investment properties unless they have a large buffer behind them. I don’t tend to feel bad for people who buy investment properties without appropriate buffers.

You know what?  Most land lords also have full time jobs or their own business that they rely on for income and to provide that "buffer".  There's probably a good chance that some of those land lords might have lost their jobs or even their businesses, therefore also their "buffer".  So go ahead and sit on your high horse judging those people who haven't planned appropriately for this unfortunate event.

 Holly298, on 30 March 2020 - 10:36 AM, said:

Yes, it’s been a nightmare for our property managers as they are getting stress calls from both tenants and landlords , and yes as pp said we get paid from the rent collected , no rent means no income for the office so we are all in a frenzy working out how to help our clients and keep the office running ( I’m in sales not property management )

I also work in real estate and it really is a nightmare.  Our PM department is busier than ever responding to the fallout from all of this and the government basically telling tenants they don't have to pay rent for 6 months.  Increased work load but reduced income because we don't get paid unless tenants actually pay their rent.

#18 spr_maiden

Posted 30 March 2020 - 10:45 AM

It's moratorium on evictions due to covid related job losses.  It doesn't offer protection for tenants who get evicted because their LLs sell,  or need their house back or etc etc.
It is not good enough for anyone.

#19 Holly298

Posted 30 March 2020 - 10:47 AM

They also say the same for personal loans /mortgages and credit cards , so all those newly unemployed people should hopefully have a ton of savings to help them pay their debts too I suppose?


#20 Lifesgood

Posted 30 March 2020 - 11:02 AM

 Amica, on 30 March 2020 - 10:27 AM, said:

To call it a 'holiday on your mortgage' is a bit deceptive. If your mortgage is $2000 a month, at the end of 6 months you owe an additional 12k on your house plus compounding interest. It's a dreadful way out. Plus it is unclear at this stage if it effects your credit rating. Landlords have been told by banks that to do it, their interest rate will go up, and/or they have to break fixed mortgages etc.

There is also no 'holiday' on rates, water, insurance, maintenance etc.
What? No you don't! You owe the same amount at the end of 6 months as you did at the beginning, plus interest. You don't owe an additional 12k plus interest.

Please don't make it out to be worse than it is.

A repayment holiday means the bank won't sell your property out from under you.

#21 Tokra

Posted 30 March 2020 - 11:05 AM

 Holly298, on 30 March 2020 - 09:54 AM, said:

We’ve had a lot of landlords thinking of selling as they have lost their jobs and can’t afford to keep the investment property any more, I think this will happen a lot over the next 12 months

They may put their houses on the market, but I can't see many people buying unless they are rich and can do it outright.

My understanding is the Government had a deal with the banks but they are actually very reluctant to put it into practice and that is causing issues because the Government can't hold their promise.

#22 #YKG

Posted 30 March 2020 - 11:07 AM

 hills mum bec, on 30 March 2020 - 10:45 AM, said:



You know what?  Most land lords also have full time jobs or their own business that they rely on for income and to provide that "buffer".  There's probably a good chance that some of those land lords might have lost their jobs or even their businesses, therefore also their "buffer".  So go ahead and sit on your high horse judging those people who haven't planned appropriately for this unfortunate event.

Even without current events anything can happen in life, the main earner can get injured/death/loss of business it’s not just restricted to these times. If you are relying on someone else to pay your mortgage that is on you, don’t buy a property that an owner occupied could’ve purchased and you wouldn’t be in financial distress.
Planning for future unforeseeable events is common sense, yes some people are unable to do that, but those people don’t tend to buy investment properties that they can’t afford.

A lot of people have full time jobs and or businesses, it’s not unique to landlords. If buying an investment property will sink you in the event of any adverse circumstances then don’t buy one. It’s not that hard.

#23 PocketIcikleflakes

Posted 30 March 2020 - 11:08 AM

I'd hate to be an agent right now.
Nothing is clear cut or regulated it seems.

We self manage and told our tenants that if anything happened to their ability to pay rent to let us know and we'd not be kicking them out. We're lucky to be in a position to do that. Even if DP is it of work for a bit freezing the mortgages would allow for that but we're in a way better position than most.

Right now in very glad we went against advice to buy properties to negative gear them.

#24 Amica

Posted 30 March 2020 - 11:08 AM

 #YKG, on 30 March 2020 - 10:35 AM, said:



Maybe people shouldn’t be buying investment properties unless they have a large buffer behind them. I don’t tend to feel bad for people who buy investment properties without appropriate buffers.

This is complete rot on so many levels it isn't funny... but the precedent was ALWAYS that if a tenant stops paying rent, you can evict. Who knew this goal post would change. It has changed not at the time of purchasing an investment or grandfathered, but MID CONTRACT.


Even after paying your excess and waiting out the initial no coverage period, once rent default insurance kicks in it only covers 4 months because YOU EVICT. These are the terms you plan for.

Edited by Amica, 30 March 2020 - 11:17 AM.


#25 HamsterPower

Posted 30 March 2020 - 11:17 AM

View Post#YKG, on 30 March 2020 - 11:35 AM, said:


Maybe people shouldn’t be buying investment properties unless they have a large buffer behind them. I don’t tend to feel bad for people who buy investment properties without appropriate buffers.

—————-

Really ? You think every landlord in the country - mostly people with one investment property -could have reasonably been expected to foresee and prepare for a situation NOONE was prepared for ? Massive companies are going to the wall but a little investor should be able to get by  and should have been ready ?????
What about small businesses ? Do they get compassion as they should have had a buffer too according to your logic ??

I don’t have an investment property but I can see it is not that simple. People like to talk about the suicides etc that will occur due to the pressures of COVID19 but apparently landlords don’t count ? Stuff them if they lost their jobs in this , their insurance doesn’t cover lost rent due to “pandemic” , their savings will be used to feed THEIR families and keep a roof over their head . All risk plans a reasonable landlord would have made are in tatters.

Everyone loses right now , to blindly expect landlords to suck it up because they didn’t foresee a worldwide disaster is beyond belief .
Most landlords are decent people who won’t know what to do right now- they don’t want tenants to suffer either, they are trying to figure out how to not make their tenants homeless while losing their business/jobs and livelihoods themselves.

You don’t know people’s story, especially right now . Have some compassion for all , not just who you deem worthy.

Edited by HamsterPower, 30 March 2020 - 11:19 AM.





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