April End of Month - How Many Tenants are in Default or Reduced Rent?

Yeah, we run our property investment portfolio like a business.

If any of our PMs doesn’t perform as per OUR expectations, we quickly sack them and find another.

In the current COVID-19 environment, the above business rule is even more important (if that is possible).

Over the years, we have had to sack a few PMs and we always tell the new PM why we are changing our service provider.

 

Another note. The Airbnb was solidly renting at $1000/week. I could rent it out ok at $450, $480....

 

Will you be sticking it out, or will you just rent it as a normal lease for the time being?

 

I may get a tenant at $500/week but I have to take into account their employment and the industry they are in too.

 

Yeah, I did have a moment of panic when they suggested that LLs had to reduce rents etc....until I decided to find out what the real damages could be, worst case scenario type thing. Phoned all property managers to find out what jobs each of the tenants had, and industry. Breathed a large sigh of relief, and just got on with it. Leaving the one high end one we have in uncertainty. But that's just been re-leased, so all good, I'm hoping.

 

Tenants that are directly affected like retail who cannot open 50% off, less affected less or no discount.
About $30k rental down for the month so pretty minor effect on the bottom line as interest down $8k and very little work done on the properties.

 

Whole gamut here.

One short stay property shot down to 0.

Another property -20% for 3 months. Good long term tenant.

Another tenant insisted on no rent then went quiet when asked to show hardship. Full rent continued to be paid on time. Weird

NRAS properties were a breeze. Had 2 of them vacated mid April (planned) but new tenants moved in just a few days later, rent unchanged.

Remaining properties all good.

 

It seems the Air BnB & similar have been the hardest hit, which I guess is predictable, since there's no tourism happening at the moment.

 

Long stays resi maintained existing rent levels, although tenants in one high end tried to push for a discount, but rent was tested to be still affordable. And tenants were even proved to be not in cashflow difficulty as even a deferred rent was turned down!

However, all hotel room types resi were affected badly, from 0-50% cashflow. The situation can only be improved when travel restrictions are lifted in Australia.

 

We had a lease expire (great timing) and tenants moved out. They had asked for reduction from $825 to $500 ...
Have re-leased at $700 pw. Was vacant for one week.

 

One tenant behind on rent after loss of work.

PM rang me to let me know. A formula process to workout what they will pay. Apparently maximum 30% of income support they are getting.

I can cover my loans from my salary so won’t speak to the relevant bank.

 

Eight out of eight tenants are all maintaining their weekly rent.

Released a one bedroom apartment in Bondi Beach for $725/week, down $20/week. I think this was more to do with an over supply of apartments. PM reported lots of sticky beakers taking advantage of working from home during the week days.

 

In a similar situation however I have been able to talk to the tenant. After request of proof of hardship he paid the first month one day before my application to VCAT. Let me know how you go. Important you follow the right steps to get money back from the Landlord Insurance.

To date other than this 2 tenants paying in time.

 

One of my tenants is behind now, lost job but on job keeper Refusing to send any Supporting pay documents. Threatening to take me to Fair trading

 

Did your hotel tenant ask for a discount ?

 

air bnb rented easily as a normal rental (offered furnished and unfurnished and they rented furnish, worked out well) (EBM let me convert short term cover to normal too (tho 60$ admin fee))

1 tenant asked for roughly 30% discount for 4 weeks and repay later. i said fine and dont worry about re paying as she always paid on time.

so no complaints here.

 

Hotel sounded out Terri Scheer on operation of landlords insurance and came out with the percentage based on what they think they can achieve during the eviction ban. Yet to be tested with Terri Scheer whether arrangement complies with claim for shortfall.

 

Our arrears have actually reduced since COVID, and I don't have a single tenant in arrears now who wasn't previously- though a couple of those have conveniently used Covid to fall further behind.

 

Not a major issue, call them out. Go to Fair Trading, and if you don't like the outcome, terminate the mediation, and get up and walk out.