How has COVID-19 affected you as a landlord?

PM just told me that my tenants have had significant changes with their shifts (hospitality workers) and are worried about making rental payments next month. Rent is ~ $1700/month... and they used to earn $8k/month. I don’t get it.. do people not save?

Anyhow, told PM that I am not decreasing rent (which he agreed with) before they prove to me that they have actually had changes in their working hours (would call their HR etc to confirm this), have failed to get Centrelink payments, failed to qualify for any payments from charities, and do not have access to their superannuation under financial hardship. Only then would I consider lowering/deferring rent.

Anyway, not stressing over it. Luckily, I have over 8 months cash buffer for all my properties. Have been on PI for a while on my IPs, and own my own house. And am still working (touch wood).

 

No, every so often there's a news story re the number of people who couldn't put their hands on (say) $500 if they needed it. Thus all those people who not only have no savings but have committed a part of the next month's pay to keeping AfterPay/Wallet Wizard/CC happy, only to find there's no pay packet.

 

I know..
but this is where people need to make some sacrifices and cut back on their discretionary spending to have a roof over their heads.
I know someone who tried to freeze their home loan repayments. The bank simply looked at their savings and said no.
Too bad we can’t get proof of saving etc for all these people trying not to pay for their rent.

 

Yes. It’s the easiest to rent out of the 3.
Tenant in P2 has concerns for his company and job. Travel (flying) has been banned since mid January and local travel (Driving) has been banned since a week ago.
P3 is the hardest to rent and since Perth Downturn has had around 6 months vacancy between tenants. It has a massive yard - takes 2hrs to mow or $150 if you keep on top it so the property is only suited to minority of tenants, mostly attracts tenants who have moved from country areas.

I had planned on building on p3 after selling P1.

So none of them are looking too great! P2 is in the middle of a insurance claim which is far from being sorted.

 

This is what my EBM relationship manager sent to me in writing - assume its off a FAQ somewhere:

Reducing rent: if a landlord agrees to reduce rent, they cannot claim for the difference in payments.

· Putting rent on hold: again, if a landlord wants to suspend rent for a couple of weeks while the tenant gets back on their feet, this would not be covered as it is a mutual agreement and not an insured event.

 

I agree that rent adjustments should be the last resort and too often its been the first. I know of someone who's got a 30% rent reduction whilst still holding a secure job

 

I have a tenant who's supposed to be moving into one of my units next week. His current agent offered him a 30% drop ($500wk down to $350wk!) to keep him there! I'd LOVE to have a chat to his Property Manager about the mess they've made for me....!

 

I've had issues with my tenants too. I posted some detail in this thread - i'd love to know if you have an opinion on what move to make here

 

Your rent isn’t that high ($1700/month). If they did fail all the above and come back to you with all the evidence, do they genuinely deserve a rent reduction? Can someone actually fail all of the above yet claim they don’t have money to pay you the full rent? Surely if they don’t qualify to the govt support out there because they are making enough money, they don’t qualify for a rent reduction.

I think the problem is the message being put out by the government that it’s only the landlords that need to be making sacrifices as opposed to tenants. All I’m hearing is rent reductions and landlords being hit and no evictions allowed. Doesn’t that already tell you landlords have no power over this at all? This sends a message to tennants that they can leverage this opportunity to ask for a rent reduction regardless of whether they genuinely deserve one or not! Tenants who weren’t planning to ask for a rent reduction will surely be asking for one.

 

I'm going to have two empty properties, by chance, not due to COVID. It makes me sick to imagine a homeless person on the street suffering or dying from COVID whilst they are empty. But I can't afford to house someone for more than 6 months, or face evicting them if they don't recover. The other option is to offer it to Hospital staff. So they don't have to catch public transport for 2h to work crazy shifts or expose their families. But I'm not sure how infection control and all insurances etc will work. In the grand scheme of things, people are doing to die. Is there a way we can help prevent this with our empty properties?

 

Had similar, chap signed up for $500pw 2 bdr unit, paid first 2 weeks rent, fully signed lease. His existing Agent coaxed him into staying with scaremongering and cheaper rent, he voluntarily forfeited $1k on my rental, 3 weeks out so likely will be re-let with no down time but bloody annoying.

 

Maybe the existing landlord paid part of the $1000

 

AirBnb has a 72h in between guests and disinfecting guidelines for first responders. Cleaning guidelines for preventing the spread of COVID-19 - Resource Centre

 

Agree. I won’t be lowering rents. I’ll ask them to pay what they can and come to some sort of agreement, and will hopefully be able to claw back what I can, once things normalise. My lease agreement was only signed a month ago, so at least they can’t run after this ends. Anyway, preparing for the worst, hoping for the best!

 

Things definitely won't normalise within 12 months.

 

ill be very honest,

I dont know what to think? should I be worried? should I be crapping my pants? should I be neutral

Ive spoken to all my PMs, and they have said their applications for hardship are tiny (however its still early days), and most of my tenants are on benefits already,

my biggest concern is this moratorium of evicting,

if I cannot evict, I am stuffed and I will lose out in every aspect , eg I dont get arrears, insurance doesnt pay out except for a few weeks if Im lucky, I have a non paying tenant, my mortgagae payments dont stop, I still have to pay interest, I dont get repayments voided like tenants not paying rent

 

It’s a moratorium on evicting for “financial stress” - sounds like we can evict unless it’s due to financial stress. We need to see the definition here, when can they claim financial stress? Is it after they’ve spent all their super? Is it after they lose their job if the Centrelink isn’t enough? Can they have any money in savings?

if they were always on Centrelink and they’re still on Centrelink it’s hard for them to claim it.