Tenant Wants 70% Rent Reduction

baybeejuice on 05/04/2020 - 10:28
Last edited 06/04/2020 - 22:40

Our tenants (a early 50s bf, gf and the gf's son) moved into my 3 bedrooms townhouse in last Dec and signed a year's contract for $470 per week. Yesterday, i got a phone call from real estate saying the tenants broke up and the male tenant is the only one living there now. He's a painter and now has zero dollar income. A screenshot summary of his 3 bank accounts showed $0, $2 and -$10. He has applied for centrelink. Now he's asking for rent to be reduced from $470 to $150! Now we don't know how to go about this. Any advice?

Edit:
Thanks for everyone's advice and comments.
The lease had only the bf's name on it. He had income of $1000 per week when applying for this property. As part of rent reduction prior to moving in, he already painted the whole place. Also, our current home that we are living in was painted 2 years ago.

Edit #2:
Correction: Just had a look at tenant application, the male tenant that is on the lease was getting $2100 gross income per week.

Home & Garden

Comments

    • baybeejuice on 05/04/2020 - 13:53

      Only the bf was on the lease

      • BinkyG on 06/04/2020 - 08:37
        +2

        How did that happen? If the agent let this slip through, then I'd be jumping on them to take responsibility for this.

  • elmotta on 05/04/2020 - 12:03
    +6

    Like most people here, I'm not qualified to give any professional advice. You should definitely seek professional advice from your accountant, financial adviser, etc.

    Now, based on a bit of common sense, the ever changing information from the government that has been released up to today and what some experts in the field are recommending (big disclaimer I know!), here is what I would do:

    • Check if your state is releasing new norms in regards rental assistance (I heard QLD might be paying rental assistance directly to landlords)
    • After getting all the facts of your tenant's current situation and the government assistance he gets/will get. Get your tenant to commit to a minimum weekly pay, lets say $250 p.w. for a period of time e.g. 10 weeks
    • Agree on a repayment plan for the difference between the minimum repayment pays and the nominal rent once this period ends.
    • Consider throwing a 10%-20% discount on the nominal rent.
    • Talk to your bank to see if they can: reduce your rates, go into interest only, or as the very last resort, give you a 'mortgage holiday' (remember it's not free and you will be charged compound interest!)
    • If you have landlord insurance, make sure your agent follows strictly all standard procedures when a tenant falls into areas, including issuing notices, etc. This will make your life a lot easier in case you need to lodge a claim later.

    Looks like the government's intentions are good by trying to spread the pain evenly. Unfortunately, there are always someone that tries to take unfair advantage of the situation. For the rest of us, please keep in mind that everyone needs to be flexible, compassionate and be willing to wear some of the cost in this difficult time.

    Hope this help

  • cynicalmike on 05/04/2020 - 12:07
    +7

    would you accept a screenshot of bank receipt as payment for something on gumtree before posting?

    • Cheeper on 05/04/2020 - 12:09
      +9

      also… is that all his accounts?

    • popsiee on 05/04/2020 - 12:37

      Its impossible Mikey if you are facing to show what is in official accounts what people have unless getting a court order which is just wasting money . Even then the offshore accounts , cyber currencies , trust etc are there for people to show they have nothing . PM policy is based on income I believe so it means nothing .

  • shamid202 on 05/04/2020 - 12:18
    +8

    Give him 1month free rent and 30days to leave your property. tell him if he leaves by the end of the 30days he wont face any penalties and will receive full bond payment back. thats your best chance to do this without hassle.

    this crisis will last at least 2years so dont be optimistic at all.

    • wordplay on 05/04/2020 - 14:47
      +8

      isn't there a 6 month moratorium on evictions? how do you give 30 days notice?

      • shamid202 on 06/04/2020 - 22:52

        The same way tenant contacted owner for reduction in rent, owner should arrange a direct agreement. They are not going to kick the tenant off the property. Its just a mutual agreement.

        • TilacVIP on 07/04/2020 - 08:38

          I guess you don't watch the news & read the papers.

          6 months non eviction. Tenants have the upper hand & there is FA the landlord can do right now.

          We're all in this together & a lot of people have been hit hard financially.

  • surfsiren85 on 05/04/2020 - 12:19
    +1

    What state are you in? Queenslanders can apply for rental grants that are paid directly to the landlord, if you're in QLD, let him know about this.

    https://www.qld.gov.au/housing/renting/rent-assistance/bond-…

  • TheBilly on 05/04/2020 - 12:25
    +2

    Why is he not applying for centrelink; getting the $750; Getting job seekers; Accessing superannuation $10k etc. etc. These all have an application process and generally speaking if the individual passes those tests, they may genuinely be in hardship. If he has just showed you $0 bank accounts that does not mean anything. Give him 1 months grave to figure it all out. When he starts reviewing his benefit $750 can go to you for the 1 month grace and then keep the rent the same as that is his discount.

    Alternatively tell him he can leave without penalty.

  • brendanm on 05/04/2020 - 12:27
    +9

    Why can he not pay rent from his jobseeker payment?

    • funnysht on 05/04/2020 - 17:30
      +5

      Some ppl on this forum despite it being a bargain site seem to think that daily living costs (rates, car payments, food) for 1 person add up to more than $500/week

      • shruglord on 07/04/2020 - 10:27

        Well, his rent is $470 a week atm, so that leaves him with $30 for all his other commitments. So yes, it does add up to more than $500 a week.

  • Miss B on 05/04/2020 - 12:35
    +1

    Offer a temporary reduction in rent if he offers you a plan for how he intends to increase his ability to pay rent - housemates, other sources of income, government assistance that has been offered etc.

  • SnoozeAndLose on 05/04/2020 - 13:04
    +5

    Tenant doesn't need 3 bedrooms any more the situation is what he describe.

    Offer him to break least which he can find a studio or some sort to live.

    Then OP need to find another tenant in this hard time.

    I also have multiple bank accounts with low or minimum amount of money, if the tenant has no money in the bank how could he even pay $150?

    I don't think their story is 100% genuine.

  • thanatos350 on 05/04/2020 - 13:05
    +9

    I don't really have anything constructive to offer, though I just wanted to chime in and say that I am glad to see that the community isn't flaming OP.

    I have seen a lot of hate directed toward landlords on Facebook and I don't think it is entirely fair.

  • rgr on 05/04/2020 - 13:45
    +1

    wasn't jobkeeper or job seeker meant to come in and provide survival money for situations like this?

  • Duram on 05/04/2020 - 13:53
    +11

    My dividends have gone down, someone please help me. All investments carry risk.

    • Destin on 05/04/2020 - 14:10
      +4

      As do relationships, jobs and health. Everyone needs a contingency plan.

    • ChickenTalon on 06/04/2020 - 14:12
      +4

      Exactly, there seems to be a massive blindspot when it comes to some landlords and investment risk. Just because it's been largely risk-free in this country to invest in property, doesn't mean there is no risk. It's like risk-free rental income is some sort of entitlement, unlike this poor guy's job.

      I can expect to lose a lot of money if I;

      • Invest in my business
      • Put my money into the share market
      • Take out a loan to buy an investment property

      If you don't want to lose money, keep it in the bank. $250,000 per financial institution and you're covered by the Australian Government deposit guarantee.

      Want better returns? Then put on your big boy pants and accept some risk.

      You don't have to accept anything from your tenant, but you are stuck in the situation where you can't evict him for 6-months (and this will probably be extended). So have a think about your options and try and get as much as you can rent wise. His offer of $150 I'd consider as a starting position, ask for more. He's painted the place, what else might he be willing to do?

      In this market you really don't want to be selling your property or looking for a new tenant. Or you may have to accept greater losses through holding an empty property or selling at the same time as a bunch of other desperate over-leveraged landlords.

      Or even worse, a falling market with an oversupply of new housing stock which was counting on those landlords to keep buying.

  • [Deactivated] on 05/04/2020 - 14:21
    +3

    How much was he earning when he was working to be able to afford a $470/week rental property? Why was only his name on the lease?

  • Jumpup on 05/04/2020 - 14:27
    +9

    Do not believe the story.
    I got the same story from my tenants when they heard you can’t evict for 6 months and people were waiving rent. His GF and family are still there.

    No free rent, he will be getting a decent salary from Centrelink soon. He should of saved up for an extra month or so like your average person would. Painters make decent money. Let him pay you at a later date when he gets his centrelink.

    Why should you lose income because he spent all his savings?

    If the story was legitimate eg has a sick family member or something and wasn’t able to save then ok I would be waiving

    • funnysht on 05/04/2020 - 17:41
      +8

      Completely valid.

      Why would you wait till your bank accoutn is $-10 before alerting your landlord you cannot pay the rent?

      Why ask or $150 instead if you have $-10 wou;dnt you ask just for a 1 month off till you get centerelink payments approved

      A sensible tenant would ask about moving out and break the lease without any penalty rather than staying in a 3bdr place by yourself

  • activ8newbs on 05/04/2020 - 14:33
    +4

    I think you should first paint the picture in the light of "we're all in this together". Both going through a tough time. Him asking you to pay him 70% of his rent is no different to you asking him to pay 70% of your mortgage.

    He's already painted the house he lives in. Get him to paint your residential house. Your other investment property and your family relatives home for cheap/nil. Whatever money he makes, comes to you (or at least a portion).

    Also, judge his character. He sent you a screenshot of the accounts. Ask him to show you 60 day transaction history if he's comfortable. And explain you're doing this to ensure that the risk you're taking on, is calculated….not a stab in the dark.

    Have an agreement, that once he starts making a bit of money, he should catch up what he missed.

    And offc, be nice. He's a human.

    Yes you're not a charity…but if you refuse to co-operate, you're both worse off.

  • wolvesaussie on 05/04/2020 - 14:36
    +2

    Saw a few people here mention car payments. Shouldn't someone let their car by repossessed before they stop paying rent. Also does anyone know how this will work with Landlord insurance if you have lost rent in the policy?

    • Jumpup on 05/04/2020 - 14:38

      You can’t claim on insurance anymore. I read the PDS because you need to issue an eviction notice which our PM made illegal now.

      • Snoochem55 on 05/04/2020 - 15:28

        My policy states the same. Surely the insurance company needs to do something about this because effectively their PDS now requires landlords to do something illegal to have a claim paid out.

        I plan on calling them tomorrow. My tenants also requested for help over the weekend but the problem is that my wife has also had all her hours cut to zero (she is self employed) and I really don't want to lose my rental income as well.

        • Jumpup on 05/04/2020 - 15:44

          Let me know how the call goes. My job is at risk as well and can’t get Centrelink.

        • funnysht on 05/04/2020 - 17:13

          sure good luck with convincing the landlord insurance companies to side with the landlord ;) and be happy to give away free money..

        • funnysht on 05/04/2020 - 17:34

          I'm with EBM and this is waht they say:

          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. However, if the tenant does not catch up on payments, normal protocols should kick in (e.g. breach notices) and then it would fall under loss of rent and the policy would respond.

          So not too bad….
          https://www.rentcover.com.au/info-centre/coronavirus-faqs

          Though not sure what this means:
          Not issuing late notices: if this sort of leniency is given to the tenant, it will only be an issue if it comes to a claim relating to termination. If you offer leniency, and then the situation snowballs, the process for eviction will ultimately drag out. If it drags out further than the number of weeks you are insured for, you will see greater losses. Ultimately, it will likely impact denial of access claims and reduce the number of covered week.

          • Snoochem55 on 05/04/2020 - 19:39

            @funnysht: I'm with Terri Sheer and it's similar wording in their PDS. Requires you to issue all the required notices etc.

            I'm hoping they'll say that for a claim to be accepted all notices need to be issued except for the actual notice to evict as its now illegal.

            My other concern is that the insurance company might then go after the tenant to recover the money.

  • Choc83 on 05/04/2020 - 14:37
    +2

    If he can only pay $150 a week right now, then that's all he can do. At least he's being open and honest about it rather than remaining silent or going on a rent strike. It's your move. Your negotiating position is compromised because the existing procedural remedy (eviction) is off the table (for good reason, mind you) - however that's left you in a vulnerable position.

    The only remedy you have for underpaid rent is to access the Bond, which will be eaten up after six weeks of lower rent. So maybe offer him six weeks at the discounted rent with the understanding that it's not a gift, but a temporary shortfall that will need to be remedied. You should probably get some legal advice on how to offer this to the tenant.

    At the end of the six weeks when the rent reverts to normal, hopefully he has had time to:

    -Get housemates in to spread the cost
    -Give him an opportunity to move to cheaper accomodation if he wishes and end the lease early
    -Allow time for a change of financial circumstances for the better (unlikely, but don't rule it out)

    if none of the three options eventuate, you're in haircut territory. Maybe talk to your tax accountant and work out if it's better for you to cop the loss in this FY or the next FY.

    Obviously you can't tell him how to come up with the money. I'd still maintain that something is better than nothing in this scenario. Once things are better, you would hope they're honourable enough to come up with a plan to repay you over time.

    • Jumpup on 05/04/2020 - 14:39

      You can’t use bond to pay for missed rent anymore. Been in this position a few months ago.

  • Donaldhump on 05/04/2020 - 14:37

    Chase the woman and son for some money, as they are on the lease, or really he should be.

    His lack of income is one thing,
    The other tenants doing a runner is another thing, that regardless is poor form.

  • [Deactivated] on 05/04/2020 - 14:59
    +2

    I feel bad for him. The girlfriend sucked him dry and then moved on to the next gullible fool.

    That being said, 70% off is a joke. I would counteroffer with a $150 off rent. Plenty of tenants out there will be happy to have a 30% rent reduction. He can choose to stay and pay , leave and find more suitable accommodation or stay and not pay and you evict him at the end of the moratorium and take him to the small claims court to recover your costs.

    • JimmyF on 05/04/2020 - 15:22
      +1

      I would counteroffer

      Would you be happy if yout boss told you you're getting a 25% reduction in your pay, but you still need to work the same hours and do the same amount of work.

      • [Deactivated] on 05/04/2020 - 15:26
        +1

        Nope. My wife was in a fairly similar situation. she gets paid 20% less now and has reduced her hours accordingly. Her hourly rates stays the same. Her boss had no problem with that.

        How is this relevant to Op's situation?

        • funnysht on 05/04/2020 - 17:04
          +1

          i think because rent is the one of the Op's source of income, so if there's a reduction in rent there is a reduction in the source of income….

          • JoJoker on 06/04/2020 - 10:42

            @funnysht: It's an investment. 90% of investments have taken a hit, globally.

            Everyone should be taking up some of the slack, not just the people at the bottom.

        • JimmyF on 06/04/2020 - 09:11

          How is this relevant to Op's situation?

          You go to work to earn money to pay your bills.

          The OP landlord rents out the place at a certain price a week to pay the bills on that, and might even be positive geared so is their income stream.

          she gets paid 20% less now and has reduced her hours accordingly

          Not the same, she had her hours REDUCED so is working less for the same hourly rate. She can go do other things with her spare time now.

          Wonder if the OP will move out of the house 3 days a week inline with the reduction asked for so the landlord can airbnb for a few days to make up the income ;)

      • tomleonhart on 06/04/2020 - 06:11

        Of course nobody is happy with a pay reduction. But the reality of this for OP is that this pandemic has affected everybody. With the government handed power over to the renter like this, there is nothing you can do to stop it from affecting you.

        • JimmyF on 06/04/2020 - 09:17
          +3

          But the reality of this for OP is that this pandemic has affected everybody.

          Well it's not affecting everyone equal in this example.

          The OP is asking to basically live rent free and will get gov assistance to keep putting food on the table as they have no cash and no assets.

          The landlord is the one taking all the hit, they will have to keep paying a mortgage unless they want to take a ding on their credit record and apply the 6 month HARDSHIP payment stop on the mortgage. During this time interest still keeps ticking over and adding up. This ding will haunt them for years to come when applying for credit. So not really fair on them.

          The landlord still has insurance, rates, water rates and GASP repairs to carry out during this time, as well as the mortgage and lets not forget the rental agent fees. Lot to cover for $150/wk.

          The landlord also won't get any gov assistance as they'll fail the asset tests, so what if the landlord also lost their job or had their hours cut, not having the money to cover all this and not getting and free gov money?

          So equal? Not at all.

          Of course nobody is happy with a pay reduction

          But you're ok with the landlord having one?

          • tomleonhart on 06/04/2020 - 09:45

            @JimmyF: Of course it’s not equal and I feel for all the landlord. But the reality of thing right now is regardless of how the landlord feel or reason, the renter has got given all the power by the government.

            So OP can reason all he/she wants, on how in an ideal world things should work, or he can try to negotiate and avoid the worst thing which is the renter stops paying all together.

            Until the government changes their policy, this is how thing going to be.

            • JimmyF on 06/04/2020 - 10:19
              +2

              @tomleonhart:

              the renter has got given all the power by the government.

              The gov granted no power to the renter to expect a rent reduction of any kind that large, in this case $470/wk down to $150/wk.

              the worst thing which is the renter stops paying all together

              Honestly its not. A drop of $320/wk in rent, it would be better for the landlord if they didn't pay.

              The funny thing was, the gov policy was as simple as landlords can't kick out people for not paying rent. It said nothing about renters not having to pay rent owed during this period. So once the 6 months free pass is over, the landlord is entitled to go after the renter to recover all money owed. In this case it would be ~$12k. Many debt collectors will take on that debt ;)

              But if the landlord offered a reduction to $150/wk and they still failed to pay, then this is all they can go after.

              How long do you offer this reduction? After 6 months, what is stopping them saying hey you have been offering this place so cheap, I'm not going back to paying the full amount.

              As I said before, it seems ok to shaft a landlord 70% of the income, but if their company reduced their pay by 70% but still wanted them to come in say 38 hours a week, all hell would break loose.

              Most landlords are not mega faceless corporations, but mums and dads trying to create a 'nest egg'. They all have bills as well.

              • tomleonhart on 06/04/2020 - 11:41

                @JimmyF:

                As I said before, it seems ok to shaft a landlord 70% of the income, but if their company reduced their pay by 70% but still wanted them to come in say 38 hours a week, all hell would break loose.

                Who said it was OK to shaft a landlord of 70% of the income? JJB suggested to negotiate and I agree.

                I have no intention to argue with anyone. You questioned JJB's comment so that's why I replied. Maybe you can put forward a solution to OP. I already put mine through.

                • JimmyF on 06/04/2020 - 15:41

                  @tomleonhart:

                  Who said it was OK to shaft a landlord of 70% of the income?

                  The tenant for starters seems to think its ok to offer 70% reduction on rent. Also many commenters in this thread agree that this is ok to do.

                  You questioned JJB's comment so that's why I replied

                  Yes I gave a different 'angle' to the its ok to counter offer a rate reduction.

                  So if its ok to request a rent reduction, its ok to do a wage reduction. Is it not? Maybe businesses are hurting and staff wages are just like 'rent', all overheads.

              • TheBird on 06/04/2020 - 14:28

                @JimmyF: @JimmyF

                So once the 6 months free pass is over, the landlord is entitled to go after the renter to recover all money owed. In this case it would be ~$12k. Many debt collectors will take on that debt ;)

                A small clarification. You can still sue now for owed money. You don't have to wait until the end of all this mess. You cannot currently evict.

                • JimmyF on 06/04/2020 - 15:33

                  @TheBird:

                  You can still sue now for owed money. You don't have to wait until the end of all this mess. You cannot currently evict.

                  I guess you could before the 6 months is up, but as you can't evict them anyhow, there is little point. Sure sue them for 2 months rent, and then what? sue again in 2 months time for another 2 months and again in another 2 months?

                  Better just to do it at the end.

                  • TheBird on 06/04/2020 - 15:47

                    @JimmyF: The point of sueing is to recover money owed. Wait until the end when the amount gets too much and the chance of full recovery lessens.

                    Do it right the first time and you're likely to find you won't need to do it again.

      • TilacVIP on 07/04/2020 - 08:44

        Guess what. That will most likely be the new norm once this situation begins to subside. Do you really think everything will just go back to normal one day, over night & all those stood down workers will just go back on the same pay they were on.??

        Think again.

        • JimmyF on 07/04/2020 - 09:53

          all those stood down workers will just go back on the same pay they were on.??

          If stood down, then yes they have to go back on the same pay.

          If let go, they can be hired at a lower rate.

    • ssquid on 05/04/2020 - 19:58

      I feel bad for him. The girlfriend sucked him dry and then moved on to the next gullible fool.

      Or she and her son were the ones paying the rent while he contributed nothing, spending his money on booze and pokies. Who knows?

      • [Deactivated] on 05/04/2020 - 20:00
        -1

        If they had a decent source of income or some savings , their name would have been on the lease.

        But you're right, this could also be a possibility.

  • Gaz1 on 05/04/2020 - 15:03

    Perhaps he expects a 50% reduction so by asking for 70% he think you will go back to him with 50%?

  • garetz on 05/04/2020 - 15:05
    +2

    Say nothing yourself, agree to nothing, so you dont do anything binding, allow him to make part payments, till the government works out how they will handle the situation they partially are responsible for.

    • tryagain on 05/04/2020 - 19:26
      +3

      Nobody made the OP take on a speculative investment, this is between him and the tenant.

    • lowlifesphere on 07/04/2020 - 11:47

      Yes the government is responsible for covid…
      You want homelessness to increase? Some tenants may abuse the moratorium, but MOST tenants know they will have 6 months of owed rent and risk being blacklisted when they try to find a future lease. The moratorium is to prevent landlords from evicting tenants who miss a few weeks of rent due to GENUINE hardship, which many are facing. Judging by the attitude of most landlords on ozbargain, it’s a good thing they did start this moratorium or else we’d be seeing evictions left right and centre with zero compassion for those suffering in this unprecedented crisis. If you over hedged and are completely reliant on rental income for mortgage repayments then that’s your stuff up, sell the property and move on. Purchasing an investment property does not entitle you to guaranteed rental income. Don’t blame tenants for not saving enough. If they were able to save enough to get them through a 6 month crisis they probably would have their own property anyway, and you would be out of a customer.

  • JimmyF on 05/04/2020 - 15:20

    his 3 bank accounts showed $0, $2 and -$10

    Then I fail to see how his going to be paying $150/wk……. until

    He has applied for centrelink

    Once this comes through, he'll be getting $1500 fortnight.

    • [Deactivated] on 05/04/2020 - 15:28

      Once this comes through, he'll be getting $1500 fortnight.

      He will be more than able to afford his rent in arrears.

    • MatthewTeng on 05/04/2020 - 15:47
      +1

      JobSeeker is currently $570 or so per fortnight + rent assistance. The government is talking about upping it at the end of April.

      He really needs to find some housemates as well. Centrelink at the moment wont cover his costs, maybe in the future, but not now.

      https://www.servicesaustralia.gov.au/individuals/services/ce…

      • cynicalmike on 05/04/2020 - 18:00
        +2

        you know what he will do? get housemates after the rent reduction is approved and have them pay for all of it (and then some).

        that's if this 'story' is even true.

      • MorriJ on 05/04/2020 - 19:58
        +1

        "The government is talking about upping it at the end of April."

        They are adding $550/fortnight from the 27th April for the next 6 months. Not upping it, effectively doubling the base rate, but still leaving it short of living pretty with a $470/w rent.

    • Eeples on 05/04/2020 - 22:50

      $1500???

      He is a painter. Sole trader. Do they get job keeper for themselves?

      • BillyG687 on 06/04/2020 - 12:43

        If his work has dropped by 30% he would be eligible. He needs to apply for it ASAP.

  • G5 on 05/04/2020 - 17:15
    +14

    If you're a landlord and can't afford repayments without a tenant, you're over-leveraged. Just like it would be ridiculous for someone to borrow $500k, invest it in stocks and cry poor when the dividends stop. There's loads of other assets you could have speculated on that aren't tied to people's livelihoods.

    • cynicalmike on 05/04/2020 - 17:45
      +16

      landlords are not a source of charity.

      if as a tenant you can't save for a rainy day and instead choose to live a glamorous life of booze and cigarettes and frequent trips to Bali (as many do) why do level headed people have to be disadvantaged because you couldn't budget more appropriately and just pay the damn rent as you are contractually obliged to do so? (remains to be seen whether landlords insurance will cover dodgy tenants here or there will be a clause added).

      most tenants couldn't give a stuff about the landlords property either and happily cause minor damages knowing they will get away with it. subletting and breaking rules in contract (eg. no pets) are commonplace and now landlords are supposed to be all kind and caring to them because scum-mo told us so?

      landlords still have to pay council rates, water rates, maintenance bills etc.
      landlords also have families and need to put food on the table.
      landlords have also most likely worked VERY hard to have that cushion or safety net only for liberals to just tell them to get stuffed and enforce freeloading for an indeterminate period.

      • G5 on 05/04/2020 - 18:56
        +14

        It's not charity - it's the nature of investing. What your tenant does with their cash is not your concern. A landlord might have 0 tenants for a long time because of a market downturn - are they going to stop paying the mortgage then?

        If anyone's being disadvantaged because THE LANDLORD didn't understand the nature of the investment, overleveraged and now they can't repay the loan.

        When the landlord invested they KNEW they had to pay rates, water, maintenance etc. What's your point? If you can't handle that, why'd buy property? There's loads of other assets you can invest in without dealing with tenants, including other ways to invest in real estate.

        Owning 👏 property 👏 doesn't 👏 guarantee 👏 rental 👏 income

        • cynicalmike on 05/04/2020 - 19:12
          +10

          i never said anything about mortgages or loans (you've magically made that assumption). not all landlords have a mortgage or rely on a mortgage to pay off their investment. you do realise that don't you?

          i can handle all of those rates thanks very much, but it's money out of my pocket. the flipside to your comment is - why is it a tenants concern what the landlord does with their cash? you seem awfully concerned about how a landlord might have 'overleveraged' and are using it as an excuse for failure to pay the rent.

          why should i care how the tenant spends their money? i don't. as long as they pay the rent. guess what? if they're not paying the rent they're out on their ass.

          if we weren't in a 'pandemic' situation then you would be well within your rights to evict a tenant if they stop paying rent (duh). granted, some people manage to find excuses and i know landlords that have had a lot of trouble getting rid of tenants that don't even pay rent, but mostly they are expected to leave. a good agent will know how to get rid of them, otherwise, bikies.

          i'd rather the house be empty for a few months (it won't be empty i'll do renovations to increase value) than have some lousy freeloader hiding behind a government mandate to live a life of luxury for a few months because they cry poor over a forged low bank balance and continue cash in hand jobs.

          like i said, landlords are not a source of charity.

          • G5 on 05/04/2020 - 19:16
            +4

            @cynicalmike: Ah, so you're one of those people who just dislikes "freeloaders". Nevermind all the freeloading landlords negative gearing at the taxpayer's expense.

            • cynicalmike on 05/04/2020 - 19:16
              +8

              @G5: why am i supposed to care? you sound like you have tall poppy issues.

              • G5 on 05/04/2020 - 19:22
                +8

                @cynicalmike: It's literally the middle of a once-in-a-lifetime pandemic and you'd rather have an empty place than give it to someone who needs it. Says it all, really.

                No tall poppy syndrome here mate, I pay more tax than the average household earns.

                • funnysht on 05/04/2020 - 19:26
                  +2

                  @G5: Though your posts sounds like you're really happy with this siutation…

                • cynicalmike on 05/04/2020 - 19:27
                  +5

                  @G5: most people have parents or friends to move in with, so how many of them REALLY need it is a very good question. there's plenty of discussion here about centrelink's doubled benefits and rent assistance as well (maybe look around), as well as discussion on potential fraud on just providing screenshots of bank balances.

                  I pay more tax than the average household earns.

                  and you've got the arrogance to boot!

                  • G5 on 05/04/2020 - 19:33
                    +7

                    @cynicalmike: Sounds like you've got tall poppy issues.

                    • funnysht on 05/04/2020 - 19:35

                      @G5: clearly not…

                      I guess id be pissed off to0 if i was paying that much tax as G5 is and not having it negatively geared.

            • dbun1 on 05/04/2020 - 19:28

              @G5: It’s a legal tax mechanism. Blame the government, not the landlord.

              • G5 on 05/04/2020 - 19:33
                +8

                @dbun1: Right, and currently evictions are illegal, blame the government. Works both ways.

                • ThithLord on 06/04/2020 - 09:01
                  +2

                  @G5: Mate, this is OzBargain. They're all Scrooge McDucks here - you're wasting your time with these toxic people.

            • TilacVIP on 07/04/2020 - 08:49

              @G5: Not to mention the interest rate cutting they have been receiving for the past few years at the cost and expense of cash account holders/pensioners / bank savers & people with a mortgage. A policy (rate cutting) that in my opinion is not working.

              Cry me a ***** river

            • aboogee on 08/04/2020 - 01:04
              +1

              @G5: ever consider positively geared investments?
              why is it asymmetrical that landlords need to pay tax on additional investment income if they arent allowed to claim deduction for deficit?
              the same as busineses right? they are able to claim deductions for their expenses to earn revenue?

      • diceman99 on 06/04/2020 - 09:45

        Be careful I think Scotty from Marketing has upped the JobSeeker payment just so Renters can pay their bills including Rent.
        If tenants start to stop paying rents, lots of over leveraged home borrowers will start to sell their properties, meaning House prices will start to spiral downwards. Scum-mo and the neo liberals are trying their hardest to maintain house prices.
        If house prices start falling they will continue downward in a death spiral

    • dhnqt on 05/04/2020 - 21:30
      +5

      This is a really bad analogy. A more correct one would be that someone borrow $500k to invest in dividend stock. Suddenly the government comes in and allows some random dude to steal 100% of their dividend and they cannot do anything about it.

    • shruglord on 07/04/2020 - 10:32

      It took me a disappointingly long time to find this measured take on the risk of property investments. Understand Landlords are getting screwed, but so is everyone.

  • crentist on 05/04/2020 - 17:39
    +8

    It doesn't make sense to force landlords to potentially deal with non-paying tenants while also giving extra money to those tenants if they need it.

    People will be getting $1500/fn without being required to pay their rent with it, even in part.
    So if the landlord depends on that income as income (and not just for paying the mortgage), now you have a landlord who will need to get on centrelink to pay for their own rent and food.
    Which means that instead of $1500 being shared, the gov will have to pay $3000.

    Assuming landlords can even access centrelink at all, given they obviously own assets.
    The alternative then is being forced to sell at very low prices in the current market, just to get some cash in their pocket.
    Which some people will claim is a great thing and the correction that is needed, forgetting that massive unemployment will push down rents and house prices in the long term regardless.

    This just seems like a recipe for distressed asset sales in the short term

    • Jumpup on 05/04/2020 - 17:48

      You can’t get Centrelink if you have a rental (asset test )

      • funnysht on 05/04/2020 - 17:49

        You can get clink if you have a rental. It depends on how much it's making

      • cynicalmike on 05/04/2020 - 17:51
        +2

        they have said they are waiving the asset test (and liquid asset test) for the time being (it was on the website somewhere)

      • TheBird on 06/04/2020 - 14:32

        Don't quote me, but I believe the assets test is waived from April 27. I believe it's all income tested for now.

  • [Deactivated] on 05/04/2020 - 18:26
    +6

    Which banks statements did he show you - the one he wants you to see or the one he doesn't want you to see?

    • funnysht on 05/04/2020 - 18:28

      if he wants the LL to be compassionate..he should at least be willing to show about 3months of statements. If not something is up..

      • kaitoivan on 05/04/2020 - 18:31
        +3

        isn't tradie preferred to get paid in cash? Bank statements don't mean anything

        • funnysht on 05/04/2020 - 18:32

          Well it'll be stupid to get paid 100% of your work in cash though. ATO will get sus.

  • Herbse on 05/04/2020 - 18:28
    +1

    Kick them to the curb. Don't let stupid things like empathy get in the way of your bottom line.

    • funnysht on 05/04/2020 - 18:31

      fink you got the wrong profile pic up…go with bender

  • sheebies on 05/04/2020 - 18:49
    +6

    $470 to $150 is just ridiculous.. I understand things are hard for people but if simply be saying no. It feels like he is trying to take advantage of the situation.

    I like the idea of offering him to break the lease with no fee, or perhaps offering to drop the rent to $370.

    But I believe what he is asking of you is extremely unfair on you.

    Good luck

    • downbythecreek on 05/04/2020 - 19:27
      +2

      Yes, offer him to break the lease without penalty.

      Unless you're that hard up that you can't be without any rental income, in which case, take the $150 and lock up 2 of the rooms.

      Don't really know what people expect the bloke to do, he has lost his job, Centrelink payments might take another month or so to come through. Even then, people seem to expect him to pay 60%+ of that in rent.

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