rent

Discussion in 'Property Market Economics' started by np999, 18th Mar, 2020.

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  1. np999

    np999 Well-Known Member

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    Macron in France started suspending all rent payment as France shuts down, and today here in Australia the media started reporting politicians are pleading with landlords to be flexible and don't evict.

    while I agree with this in principle, there are no details on how this is done in practice?

    if I'm a renter, can I just tell my agent I won't pay next week's rent?

    it's caused a big alarm and URW was sold off over 30% before recovering some ground, and scentre was down over 10%.

    are there any legal basis for stop paying rent?

    I sympathize with the retailers but what about office renters?
     
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  2. thatbum

    thatbum Well-Known Member

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    Lol no, in short.
     
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  3. robboat

    robboat Well-Known Member

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    Rent : a tenant's regular payment to a landlord for the use of property or land....
    It's in your rental agreement.
    No rent = no stay

    I did hear a rumour that some (overseas) governments may subsidise rents of people proved to be directly affected by COVID.19 closures.
    No facts, but I think it was to support social housing, not private.
     
  4. The Y-man

    The Y-man Moderator Staff Member

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    Couple of things here.

    Europe - unlike Australia, I understand home ownership is very low and that almost everyone rents - this means rental policies can have effect on a larger proportion of people (happy to be corrected)

    Commercial - yes, these can be brutal. However, if the owner has a loan on the property, it would be advisable to negotiate with the tenant (rent holidays etc) rather than having them go out of biz, and have the bank call in the loan. Even if you didn't have a loan, it may be better to keep a tenant who has some likelihood of recovery than going vacant.

    The Y-man
     
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  5. TMNT

    TMNT Well-Known Member

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    Well if my mortgage payments can be stopped/postponed exactly like rent by the banks, i am up for it


    But all landlords are rich and greedy ........so
     
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  6. The Y-man

    The Y-man Moderator Staff Member

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    I believe mortgage holidays should be seriously looked at for specific cases.... and that is coming from someone who holds a lot of bank shares....

    The Y-man
     
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  7. Scott No Mates

    Scott No Mates Well-Known Member

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    I've already discussed this in-house and will need to decide on a case by case basis. The larger/multi-site tenants will get nothing/little, the small business types we'll consider going to half rent. Better to carry a tenant than to have 12 months of vacancy and $0/month.
     
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  8. JohnPropChat

    JohnPropChat Well-Known Member

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    Mortgage payments will be capitalized at best, rent if allowed to pay later will end up in court for financial hardship. Insurance won't cover as they haven't been evicted as per "normal" times and rules.

    No winning.
     
  9. marmot

    marmot Well-Known Member

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    How do you legally evict someone that had coronavirus and the whole house is under Quarantine as it spreads through the household.
     
  10. Scott No Mates

    Scott No Mates Well-Known Member

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    Under the normal provisions of the lease eg breach, 90 days for no reason, end of lease.
     
  11. Christopher Kocksch

    Christopher Kocksch Member

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    I’m French, have followed the French news and just want to clarify that the rent and utilities suspension over there is only for businesses, not residential.
     
  12. km1974

    km1974 Well-Known Member

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    I wonder if household rents may actually increase in cost.

    I think many people who were about to buy would freeze off and or "just rent" for the prices to "come down", so unless I'm missing something, there should be more demand for rental properties.

    Also, I wonder if landlords will start vetting possible tennants more, e.g. would you rather lease an IP to a couple who both work in cafes/restaurants or to a couple who work e.g. in the medical industry?
     
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  13. Rex

    Rex Well-Known Member

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    Yep. I imagine tribunals / magistrates courts will soon be closed or operating at very diminished capacity at best. Good luck evicting somebody.
     
  14. Hetty

    Hetty Well-Known Member

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    A colleague asked me this today and I said the same thing. Holding property costs money, it’s unreasonable to expect us to give free rent.
     
  15. JohnPropChat

    JohnPropChat Well-Known Member

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    I'll allow tenants to "not pay rent" if I can claim the rental loss as an tax offset (not a deduction) or the government should transfer rent to landlords on behalf of struggling tenants and to do my bit I am willing to take 20% less rent during the crisis.

    Fair go has to be fair for everyone (landlords including)
     
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  16. Patrico1966

    Patrico1966 Well-Known Member

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    I won't be reducing the rent on my property, I have already done the right thing by the tenant over the past 3 years. So I might have a battle on my hands by the sound of it.
     
  17. peastman

    peastman Well-Known Member

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    I could see some sort of a plan like this working.
    Renters impacted by unemployment/sickness etc could apply for reduced/free rent. The banks would then stop interest and give a payment holiday to the landlord. Then the Govt would maybe cover the cost to the bank. With very low-interest rates anyway, maybe it would be not too expensive to implement.
    Tenant isn't homeless, Landlords and Bank could probably manage, but may not make money. Reasonably cheap bailout for the Government. No-one really wins, but we all manage to exist.
     
  18. Melbourne_guy

    Melbourne_guy Well-Known Member

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    I held a property but it is hard work even with a good property manager. I always felt it was only one bad tenant away from turning a reasonable investment into a bad one so sold out. A downturn should be considered in the costings as much as a bad tenant and investing in property or any other asset class, never was a one-way bet.
     
  19. peastman

    peastman Well-Known Member

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    I have listed a property with a slightly reduced rent to hopefully generate a lot of applicants. The hope is I can choose someone in a "safe" industry.
     
  20. Stoffo

    Stoffo Well-Known Member

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    So is the discussion about "postponing" rental payments or allowing "rent free" for a few weeks ?

    If the majority of resi tenants don't have enough income to carry over a few weeks maybe they should be using some of that holiday leave they have been saving up......
    If commercial can't carry a few weeks then they shouldn't be in business.......

    I do understand many more people than ever are casual these days and life is harder being casual, I spent many years being a casual and always kept a buffer, that 25% loading isn't exactly pub money"!