Reading NAB's results announcement it's pretty clear self-funded retirees and anyone invested in the big 4 banks are going to be in for a rough time and probably worse to come.

Most retirees I know have lots of redundancy - they can access cash from their super if they can't get bank dividends.

There's a lot of landlords on Property Chat complaining that they don't have any cash and are in financial trouble on account of non-paying tenants - I'm sorry but if you put yourself in that position then it's up to you to work it out. You shouldn't put all your eggs in the one basket as the saying goes.

There's signs emerging of just how bad the property market and rental market is becoming.

Sales volumes are down 85% in Melbourne and 75% in Sydney - people are pulling properties off the market rather than sell at the moment. If you're a landlord in a big city things are looking diabolical: The hardest hit for vacancies and falling rents are the inner suburbs - Sydney's east has seen asking rents fall by 10% while Sydney CBD has seen rents fall by a whopping 17% in the last two months. That's a huge reduction in income if you are relying on that money to pay off the investment.

Interesting times.

Banks are already reporting that they're doing it very tough and we're barely two months into this thing with a long way to go -

NAB was in a trading halt yesterday and announced a capital raising from its shareholders. Profits are expected to be down by half with dividends cut by the same amount. NAB also said that they've had over a hundred thousand calls to their 'help-line' with regards to mortgage and debt arrears.

Same news from the ANZ - ABC:

In total, the bank has announced "impairment charges" — reserves to cover expected bad loans — of $1.67 billion. On top of that, ANZ has also taken an $815 million hit to the value of its Asian investments due to coronavirus and is deferring a decision on whether to pay a dividend or how much it will be until there is greater clarity on the fallout from COVID-19.

That has left the bank with a $1.55 billion net profit for the half-year ended March 31. The bank's preferred measure of cash profit fell even further, down 60 per cent to $1.41 billion.

ANZ's half-year report reveals that the bank has already received requests for assistance from around 105,000 customers with $36 billion worth of home loans — about 14 per cent of the bank's total home loan portfolio.

A rushed change in the law in Victoria in a vain attempt to protect landlords - Seven Melbourne:

Legislation that cleared state parliament last week to combat effects of coronavirus on the state economy now requires renters on month-to-month leases to get a Victorian Civil and Administrative Tribunal order if they want to move out. At the tribunal, they would need to prove “severe hardship” or made to stay put.

The temporary law is a significant departure from the original one requiring the tenant to provide 28 days’ written notice before leaving - no reason needed.

Human rights organisation Liberty Victoria says the change is “unprecedented”.

“It puts so much more power in the hands of the landlord,” a Liberty spokeswoman said.

I really don't get this latest move by the Andrews government - if you aren't on a lease then it's your right to leave with 30 days notice and now they're saying (effectively) that all tenants are now on leases that they never signed - for what purpose? To force people to continue to reside in properties that they can't afford or want to leave? If someone really wants to leave a property they'll simply stop paying rent and post the keys back - this will lead to lots of people simply abandoning their rental properties rather than having to go to VCAT and prove hardship; it's also going to clog VCAT up with cases stretching on for months until you case can be heard.

It sounds very much like the VIC government was lobbied by landlords to make this change but frankly trying to force tenants to reside at a property that they want to leave and/or can't afford will just make this situation even more chaotic that it already is.

A rushed change in the law in Victoria in a vain attempt to protect landlords - Seven Melbourne:

Legislation that cleared state parliament last week to combat effects of coronavirus on the state economy now requires renters on month-to-month leases to get a Victorian Civil and Administrative Tribunal order if they want to move out. At the tribunal, they would need to prove “severe hardship” or made to stay put.

The temporary law is a significant departure from the original one requiring the tenant to provide 28 days’ written notice before leaving - no reason needed.

Human rights organisation Liberty Victoria says the change is “unprecedented”.

“It puts so much more power in the hands of the landlord,” a Liberty spokeswoman said.

I really don't get this latest move by the Andrews government - if you aren't on a lease then it's your right to leave with 30 days notice and now they're saying (effectively) that all tenants are now on leases that they never signed - for what purpose? To force people to continue to reside in properties that they can't afford or want to leave? If someone really wants to leave a property they'll simply stop paying rent and post the keys back - this will lead to lots of people simply abandoning their rental properties rather than having to go to VCAT and prove hardship; it's also going to clog VCAT up with cases stretching on for months until you case can be heard.

It sounds very much like the VIC government was lobbied by landlords to make this change but frankly trying to force tenants to reside at a property that they want to leave and/or can't afford will just make this situation even more chaotic that it already is.

Forcing people to stay in a property when they want to leave?

As a landlord, do you really want a tenant in your investment that you have the law forcing them to stay. I'd rather them out!

Reading NAB's results announcement it's pretty clear self-funded retirees and anyone invested in the big 4 banks are going to be in for a rough time and probably worse to come.

Most retirees I know have lots of redundancy - they can access cash from their super if they can't get bank dividends.

There's a lot of landlords on Property Chat complaining that they don't have any cash and are in financial trouble on account of non-paying tenants - I'm sorry but if you put yourself in that position then it's up to you to work it out. You shouldn't put all your eggs in the one basket as the saying goes.

There's signs emerging of just how bad the property market and rental market is becoming.

Sales volumes are down 85% in Melbourne and 75% in Sydney - people are pulling properties off the market rather than sell at the moment. If you're a landlord in a big city things are looking diabolical: The hardest hit for vacancies and falling rents are the inner suburbs - Sydney's east has seen asking rents fall by 10% while Sydney CBD has seen rents fall by a whopping 17% in the last two months. That's a huge reduction in income if you are relying on that money to pay off the investment.

Interesting times.

Ahh, how much do we need to protect people from themselves?

They borrow 90-100% and then have so little in reserve and other cash that if a tenant defaults they have their backs against the wall in weeks.

For me, my rules was 75% finance, no more. Allow at any time you will not receive rent for up to a year or equivalent in repairs is required. Worse case in almost any scenario you walk away with nothing but debt free.

Reading NAB's results announcement it's pretty clear self-funded retirees and anyone invested in the big 4 banks are going to be in for a rough time and probably worse to come.

Most retirees I know have lots of redundancy - they can access cash from their super if they can't get bank dividends.

There's a lot of landlords on Property Chat complaining that they don't have any cash and are in financial trouble on account of non-paying tenants - I'm sorry but if you put yourself in that position then it's up to you to work it out. You shouldn't put all your eggs in the one basket as the saying goes.

There's signs emerging of just how bad the property market and rental market is becoming.

Sales volumes are down 85% in Melbourne and 75% in Sydney - people are pulling properties off the market rather than sell at the moment. If you're a landlord in a big city things are looking diabolical: The hardest hit for vacancies and falling rents are the inner suburbs - Sydney's east has seen asking rents fall by 10% while Sydney CBD has seen rents fall by a whopping 17% in the last two months. That's a huge reduction in income if you are relying on that money to pay off the investment.

Interesting times.

Ahh, how much do we need to protect people from themselves?

They borrow 90-100% and then have so little in reserve and other cash that if a tenant defaults they have their backs against the wall in weeks.

For me, my rules was 75% finance, no more. Allow at any time you will not receive rent for up to a year or equivalent in repairs is required. Worse case in almost any scenario you walk away with nothing but debt free.

It's not so much the outright percentage that is the killer, it's the combination of the percentage and the amount it is a percentage of.  100% can be fine as long as you can afford the repayments etc come what may while 50% is too much if you cannot.

I actually have a rental unit in the Sutherland Shire of Sydney and the tenants (a couple of newlyweds) both lost their jobs pretty much as soon as things went pear shaped and gave notice that they wanted to break their lease as they were moving in with her parents.  I was quite prepared to be fairly generous in those conditions but they had made up their minds they had to leave and have now done so.

I have owned the unit for 22 years, the mortgage is a distant memory, it is by not my only income, and if it sits vacant for a while it is not going to be  a disaster.  Yes I am lucky but something comparable arose in the rental market about 20 years ago, it sat vacant for several months, but even then it was more a a pain in the butt than an unmitigated disaster despite being hocked to the rafters at the time.  It comes down to how stretched you are.

Finding a new tenant is proving problematic and the agent is giving it their best shot.  They are aware of my slightly casual attitude and I asked them the other day whether our situation was typical and some of their other landlords were getting jittery about vacancy rates.  The response was yes on both counts.

How the hell you could force people in a situation like my tenants to stay is beyond me and equally why would you want to.

Ahh, how much do we need to protect people from themselves?

They borrow 90-100% and then have so little in reserve and other cash that if a tenant defaults they have their backs against the wall in weeks.

For me, my rules was 75% finance, no more. Allow at any time you will not receive rent for up to a year or equivalent in repairs is required. Worse case in almost any scenario you walk away with nothing but debt free.

It's not so much the outright percentage that is the killer, it's the combination of the percentage and the amount it is a percentage of.  100% can be fine as long as you can afford the repayments etc come what may while 50% is too much if you cannot.

I actually have a rental unit in the Sutherland Shire of Sydney and the tenants (a couple of newlyweds) both lost their jobs pretty much as soon as things went pear shaped and gave notice that they wanted to break their lease as they were moving in with her parents.  I was quite prepared to be fairly generous in those conditions but they had made up their minds they had to leave and have now done so.

I have owned the unit for 22 years, the mortgage is a distant memory, it is by not my only income, and if it sits vacant for a while it is not going to be  a disaster.  Yes I am lucky but something comparable arose in the rental market about 20 years ago, it sat vacant for several months, but even then it was more a a pain in the butt than an unmitigated disaster despite being hocked to the rafters at the time.  It comes down to how stretched you are.

Finding a new tenant is proving problematic and the agent is giving it their best shot.  They are aware of my slightly casual attitude and I asked them the other day whether our situation was typical and some of their other landlords were getting jittery about vacancy rates.  The response was yes on both counts.

How the hell you could force people in a situation like my tenants to stay is beyond me and equally why would you want to.[/quote]

Thanks for your comments, interesting. I wonder how many will be headed home to Maa and Paa?

For it gets down to I want to sleep at night and reduce the need for me to have to lick my bosses a@$e for fear of loosing my income to pay for all this. But that's something I apply to everything in my life.

We have only on rental now and I wish we'd put more effort to get rid of it before. Living 700km away and dealing with tenants was bad enough, living OS, ugh! Anyway this guy claimed he couldn't pay, like you I was ready to put anything on the table, including up to 3mths 50 - 25% rent (not talking cut, actual) if needed. But I asked for proof, no was coming and under the threat of legal action he paid.

Our property is on a low income island that doesn't rent well during winter so I'd rather he stay until spring.

I suspect you will get tenants soon enough. At the moment no one is moving, but once this eases, if you willing to take a hit on rent for 12mth, you will get them in. The hard landlords or ones desperate will keep prices up. I normally just drop down to fill with a 5% increase the following year.  

Good luck

Regards
Shane

Forcing people to stay in a property when they want to leave?

As a landlord, do you really want a tenant in your investment that you have the law forcing them to stay. I'd rather them out!

It's stupid, if you are a landlord you should have already had a lease in place and not allowed it to move to periodic rental. The VIC Andrews government hits peak stupid yet again -

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

A real estate agent being useless. Colour me surprised. Remember it's all up from there (except maybe politician or journalist).

Is it a case of $ v sovereignty?

https://www.9news.com.au/national/coronavirus-china-twiggy-forrest-kerry-stokes-want-australia-back-down/88857dfb-f9d9-4995-8ece-34d6095e9853?ref=BP_RSS_ninenews_2_billionaires-say-we-should-back-off-against-china-over-covid-19_300420

Is it a case of $ v sovereignty?

https://www.9news.com.au/national/coronavirus-china-twiggy-forrest-kerry-stokes-want-australia-back-down/88857dfb-f9d9-4995-8ece-34d6095e9853?ref=BP_RSS_ninenews_2_billionaires-say-we-should-back-off-against-china-over-covid-19_300420

G'day all.

I am speechless, to some dollars are more important than people.

If we need an independent agency to investigate China, may I recommend the War Crimes Commission in the Hague. They are very  experienced and talented in dealing with nasty situations and recalcitrant people who believe they have done nothing wrong.

Regards,

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

They're probably inundated with similar situations right now and the larger landlords with multiple properties will be getting all their attention.

G'day all.

I am speechless, to some dollars are more important than people.

If we need an independent agency to investigate China, may I recommend the War Crimes Commission in the Hague. They are very  experienced and talented in dealing with nasty situations and recalcitrant people who believe they have done nothing wrong.

Regards,

Twiggy Forrest and Kerry Stokes both going in to bat for the Chinese Communist Party is nothing short of bizarre - and there's nothing wrong with the international community wanting to know the precise origins. The CCP just don't want us to know how they mis-managed the virus in the early stages - especially by making scientists and doctors shut up about it and just pretend it's not happening (as they're apt to do).

And then you have this pearler from Twiggy again today (via News.com.au):

Scott Morrison has slammed “fantasyland” claims by billionaire Andrew “Twiggy” Forrest that COVID-19 could have come from Australia instead of China and urged him to stop freelancing in foreign affairs.
The Prime Minister slapped down suggestions made the virus may have come from a Western country before it was discovered in Wuhan as “nonsense”, a claim that was recently made by the mining magnate.
“I don’t think anybody is in any fantasyland about where it started, it started in China,’’ Mr Morrison told 2GB on Friday morning.
“It started in China. That is not a statement of accusation or criticism, it’s just a statement of fact.”
Mr Forrest sparked national headlines this week when he invited Victoria’s Chinese consul-general Long Zhou to a press conference with Health Minister Greg Hunt.
The surprise appearance blindsided the Morrison Government and the Prime Minister confirmed today he was not invited by the government.

I really don't get the need to suck up to the communist regime, inviting a Chinese diplomat to a press conference with the government was bad enough but trying to blame the Australian government for the origins of COVID is frankly rubbish.

CoreLogic published a report yesterday spelling out the disaster that the residential rental market has become recently. Here's one chart that pretty much summaries the situation showing the enormous jump in available rental properties across each market -


The jump that Melbourne has experienced is huge - 36% - but then that's probably a reflection of the fact that 'education' had become a huge export industry centered on Melbourne and Monash University.

Also surprised to see that inner Adelaide had jumped by 13% - I guess we also have an international student market here too but not nearly as big as the eastern states.

G'day all.

I am speechless, to some dollars are more important than people.

If we need an independent agency to investigate China, may I recommend the War Crimes Commission in the Hague. They are very  experienced and talented in dealing with nasty situations and recalcitrant people who believe they have done nothing wrong.

Regards,

Twiggy Forrest and Kerry Stokes both going in to bat for the Chinese Communist Party is nothing short of bizarre - and there's nothing wrong with the international community wanting to know the precise origins. The CCP just don't want us to know how they mis-managed the virus in the early stages - especially by making scientists and doctors shut up about it and just pretend it's not happening (as they're apt to do).

And then you have this pearler from Twiggy again today (via News.com.au):

Scott Morrison has slammed “fantasyland” claims by billionaire Andrew “Twiggy” Forrest that COVID-19 could have come from Australia instead of China and urged him to stop freelancing in foreign affairs.
The Prime Minister slapped down suggestions made the virus may have come from a Western country before it was discovered in Wuhan as “nonsense”, a claim that was recently made by the mining magnate.
“I don’t think anybody is in any fantasyland about where it started, it started in China,’’ Mr Morrison told 2GB on Friday morning.
“It started in China. That is not a statement of accusation or criticism, it’s just a statement of fact.”
Mr Forrest sparked national headlines this week when he invited Victoria’s Chinese consul-general Long Zhou to a press conference with Health Minister Greg Hunt.
The surprise appearance blindsided the Morrison Government and the Prime Minister confirmed today he was not invited by the government.

I really don't get the need to suck up to the communist regime, inviting a Chinese diplomat to a press conference with the government was bad enough but trying to blame the Australian government for the origins of COVID is frankly rubbish.

Hey, scumo, tell forest to pull his head in, just mention MRRT.
The mining tax.

Hey, scumo, tell forest to pull his head in, just mention MRRT.
The mining tax.

Gina was the most vocal about that I seem to recall - it would be interesting to know how much the removal of Rudd was to do with those mining billionaires. Once-in-a-century windfall wasted thanks to Gillard's scrapping of MRRT, we could have avoided getting into the quagmire of debt that the Liberals have been creating for us with a proper tax of exported minerals and energy.

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

They're probably inundated with similar situations right now and the larger landlords with multiple properties will be getting all their attention.

I get that, but not even a placeholder email was provided which i think is reasonable. Anyway after a mail from me they came back to me today with a detailed explanation. Tenant claims to have lost their employment due to covid-19 (was employed in tourism) just gathering the paperwork. cheers

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

They're probably inundated with similar situations right now and the larger landlords with multiple properties will be getting all their attention.

I get that, but not even a placeholder email was provided which i think is reasonable. Anyway after a mail from me they came back to me today with a detailed explanation. Tenant claims to have lost their employment due to covid-19 (was employed in tourism) just gathering the paperwork. cheers

Further to my previous post about $ v sovereignty:

https://www.smh.com.au/politics/federal/the-money-or-our-sovereignty-china-leaves-us-no-choice-20200501-p54p57.html

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

They're probably inundated with similar situations right now and the larger landlords with multiple properties will be getting all their attention.

I get that, but not even a placeholder email was provided which i think is reasonable. Anyway after a mail from me they came back to me today with a detailed explanation. Tenant claims to have lost their employment due to covid-19 (was employed in tourism) just gathering the paperwork. cheers

Have they asked for a rent reduction?

I read today that the JobKeeper allowance has only been taken up by a third of the businesses that are eligible for it - the common explanation being that it's too complicated and the ATO will only pay in arrears by about six weeks. Many small businesses just can't afford to wait that long to get paid so they're telling their employees to go and apply for the "super-dole" instead.

Australia deteriorates even further to become the second-lowest manufacturing nation in the OECD - only Luxembourg has less manufacturing as a proportion of GDP than we do:



Nobody can manufacture here because we had deliberate policies in place to push those jobs off-shore - look at the way Hawke/Keating introduced the Button Plan as being 'good for us' eventually destroying the car industry in its entirety.

We also continue to have the world's highest gas and electricity prices (despite having mountains of gas and coal) - workers that are 10% more expensive than equivalent overseas workers due to compulsory superannuation; some of the world's most expensive housing (Sydney is still more expensive than Manhattan or London).

Australia deteriorates even further to become the second-lowest manufacturing nation in the OECD - only Luxembourg has less manufacturing as a proportion of GDP than we do:

Nobody can manufacture here because we had deliberate policies in place to push those jobs off-shore - look at the way Hawke/Keating introduced the Button Plan as being 'good for us' eventually destroying the car industry in its entirety.

We also continue to have the world's highest gas and electricity prices (despite having mountains of gas and coal) - workers that are 10% more expensive than equivalent overseas workers due to compulsory superannuation; some of the world's most expensive housing (Sydney is still more expensive than Manhattan or London).

The table is useless as it does not take into account what the rest of the economy is doing.  A better indicator would be manufacturing of GDP  per capita.   unfortunately I can't find this on web so I had to do some calculations.

GDP  figures are from https://www.ceicdata.com/en/country/turkey  in USD

Turkey   GDP per capita  $9,126   if 18.8% is manufacturing    =  $1,642
Australia GDP per Capita $55,305  if 6.6%  is manufacturing    =  $3,650

so we are doing  twice as much as  Turkey and not  ~3 times as less as the table would have you believe.

The table is useless as it does not take into account what the rest of the economy is doing.  A better indicator would be manufacturing of GDP  per capita.   unfortunately I can't find this on web so I had to do some calculations.

GDP  figures are from https://www.ceicdata.com/en/country/turkey  in USD

Turkey   GDP per capita  $9,126   if 18.8% is manufacturing    =  $1,642
Australia GDP per Capita $55,305  if 6.6%  is manufacturing    =  $3,650

so we are doing  twice as much as  Turkey and not  ~3 times as less as the table would have you believe.

Respectfully disagree, Turkey doesn't have the same GDP as we do, it's a poor nation in terms of GDP per capita. If you want to compare like-for-like we should be evaluating ourselves against more developed nations like Poland, Ireland, the UK, The United States. In terms of those countries our actual manufacturing output is totally dismal (and still shrinking). This chart from the Bureau of Trading Economics clearly spells out the continued decline for Australia:



The fundamental problem is that we don't have a tax system geared towards making things; instead we have a system that rewards real estate speculation, share market trading and flipping houses - that's why our manufacturing base went to merde.

The people who are calling for manufacturing to be bought back on-shore like Tony Abbott and Kristina Keneally are only calling for medicines and facemasks to be made here just in case there's another COVID thing around the corner - they're not talking about bringing manufacturing jobs back on-shore en masse. By the time they actually set up supply chains and start making those things then this disease thing will be over (hopefully).

My Tennants in Sydney seem to have also stopped paying rent. More annoying is the agent has said nothing - just the statement showed up from them this morning showing no income for April. No explanation - just $0 income and they now show ME in arrears in land tax since they had no funds from the Tennant to pay it.

I want to be reasonable and am ready to give the Tennants a break, but this approach is not good from the agent.

They're probably inundated with similar situations right now and the larger landlords with multiple properties will be getting all their attention.

I get that, but not even a placeholder email was provided which i think is reasonable. Anyway after a mail from me they came back to me today with a detailed explanation. Tenant claims to have lost their employment due to covid-19 (was employed in tourism) just gathering the paperwork. cheers

Have they asked for a rent reduction?

no, they just stopped paying, so i guess their request is zero. They sent the agent a cooy of their employment termination notice on the employers letterhead, which fails to mention the reason for termination being Covid 19, it mis-spells the suburb of the employers address and the employers address is a residential unit in a high rise. I mean which company misspells their own address on official letterhead????. Scam anyone????

On the otherhand the tenant up to now has never been late with rent over 7 years and has looked after the property....I would rather a period of reduced rent (not zero) than no rent for a longish period and then unknown tenants.

cheers