Non paying tenant - It's started.

Deferred payments get added to loans, and repaid sooner as I understand. There’s talk of some 4.5% rate floating around but I’m not sure that’s true

 

Here's a thought. Payments to landlords seem to be not very enforceable. Payments to banks seem very enforceable. So, how about a new payment system that effectively converts rent payments to debt payments.

Here's how it works. Say my tenant wants a 6 month lease. Total rent over 6 months is $20k. I lend $20k to an intermediary. The intermediary lends $20k to the tenant. The tenant pays me $20k rent up front. The tenant now has a $20k loan contract with the intermediary, which they pay over the next 6 months. Let's say the intermediary is a bank. Landlords are easy targets for governments (and no doubt the other options are only going to be worse in this regard than ScoMo!). Try defaulting on a bank instead.

 

Amazing. You should post that on the some various advocate groups Facebook pages

 

That's 3rd line forcing. Also you would need a financial services licence to do that.

Anti-competitive (you can't force a party to purchase a 3rd party service or product in order to consume your service) and in breach of financial services law.

This is what people forget about property investment - when you decided to rent the property out, this is the risk that you took on.

 

3rd line forcing..I think it depends. If they were given a choice of any bank, it wouldn't be.

 

it's like saying you have to pay by credit card. Needn't specify which card.

 

But then they could choose not to have a bank loan.

What you are effectively talking about is a $20k upfront payment to yourself that they choose how to finance. You'd still have to lend someone else money - which means you'd still be in breach on that count.

You can do that now. You simply have a rental agreement where you won't rent out the property without 6 months paid in advance. You just aren't calling it that.

Good luck renting it out though.

If you want that level of risk why not just sell the property and invest in a managed fund?

 

Starting to notice quiet a few posters playing Sir galahad when it comes to trying to swing momentum against landlords who want a fair deal instead of the rubbish that the GOVT has come up with. They have come out of the woodwork and I would be betting that quite a few of them don't have an investment property and are probably tenants who don't want to pay rent at all. This Govt idea is totally wrong and I know where I stand....for myself...The Landlord. There have been many posters giving very good reasons why this preposterous ( rent free) idea stinks. I applaud you for having the courage to stand up to the sneaky, the sly, the weak and the bludgers.

 

Ha I read your posts here today and I see your game matey! Anyway, to the actual investors, I'm sure there will be some innovation in payment security on the other side of this virus. Landlord insurance will likewise evolve.

 

No, you knew what the risk was when you went into property investment. However now crying poor in a swift and sudden downturn and the number of concepts floated on here which are just outright illegal is astounding.

Everyone is going to feel pain here. There is no missing that the landlords are part of that list. What the government is doing, is putting a temporary measure in place to avoid sudden mass evictions and homelessness.

These are unprecedented times. This is not BAU.

 

Who is going to insure against a pandemic? There is no insurer in the country that will insure anything (employment, life, housing, investment) against this sort of event. Most insurers already have exclusions to this. Like most investments - the key is to have enough depth to outlast the downturn to when things turn positive again. Whether home owner, property investor, indexed funds etc.

 

Agree so very much.
You can tell who are the seasoned LL's on here without a doubt .

 

adprom - this is a property investment forum. I don't see any value in your comments here.

 

Hang on... the landlords on here talk all business like... until, it goes downhill and then cry poor. Like all investment options there is potential for growth but also risk. Everyone who invests accepts that risk. It isn't that anything is biased against landlords at all (in fact Aus has fairly landlord friendly laws compared to many parts of the world).

This is the choice and risk that investors accept when they invest in property. Just like those who invest on stock market, managed funds, cash bonds etc. There is no investment without risk. If there was less risk, then the price of entry would be higher (and likely lower returns).

 

We’re better off planning how to diversify out of here to be honest. History hasn’t demonstrated when you kill hard work and aspirations, talent and capital leaves. Yet populist governments will always make the same mistakes.

 

Calling out logical fallacies? Of course you don't see value in what I am saying because you don't agree.

Do you only want discussions where everyone has the same point of view? I have simply called out a number of items where:
1. Illegal activities are suggested
2. Logical fallacies are involved
3. Highlighting the risk of all investment including property and that we are in unprecedented times.

Just because you don't like what I say does not mean I don't have an interest or reason to be here.

 

Yes and one of the risks includes populist policies.

And you’re exactly right. Not crying poor. Plenty of cash to last over two decades of no rent.

Future values and investment decisions will also reflect the psyche of a country’s government and public sentiment, including whether it encourages aspiration or socialist behaviour and class warfare, and new registered voters such as yourself who join a property forum today to laugh at landlords in times like this

 

This is happening in all parts of society right now. Income streams are drying up and people and businesses are unable to pay. This is not unique to landlords. The government has put something in place to avoid a sudden housing disaster - what the solution will look like longer term is still yet to be figured out. People didn't consider that they would lose 50-100% of their incomes all at once (with little prospective for employment in the short term).

Even if you did evict all the tenants after 2 months, what do you think would happen to rental prices with a lot of homeless people and no one able to afford housing? The current pain is not likable - but everyone is in the same boat right now.

 

Have you considered what the non-interventionist outcome of mass evictions, homelessness and plummet in rental demand would look like? (not to mention violence, theft and overall breakdown in society).

Counter intuitively the current policy may well protect the investments in the long term with some short-medium term pain.