There’s been a lot of questions coming in about the coronavirus and its implications to the property market, the finance sector and the economy at large — particularly in direct response to the higher levels of social distancing regulations we’re now seeing and its flow–on effect to unemployment and how we transact property.
So, today we’re answering a whole heap of Frequently Asked Questions (FAQs) about how COVID-19 affects you as a property investor, a home owner, a first home buyer, or someone who’s in fortunate circumstances to take action on the opportunity.
‘Cos, let’s be real folks… if you’re dining out on the news cycle, it’s a very scary place out there!!
Again, we must repeat… our message of calm remains…. but we’re going to dig even deeper into what we’re starting to see as this pandemic unfolds.
As well as answering a whole lot of your questions (all of them listed below), we’re ALSO going to give you some Frameworks and Tips to support you during this time so you’re prepared, have the RIGHT knowledge behind you and can navigate the “new world” we’re all now living through!
We touch on it in today’s episode, but just in case you need a recap… folks are likely to fall into ONE of TWO categories during this time…
- “Take Action” Club – This is a small percentage of folks who are ready to take action based on their individual circumstances (please seek professional advice before you do this)
- “Money Management” Club – The vast majority of folks will sit here and during this moment-in-time of uncertainty, should focus on the gaps in their money management
Free Resources Mentioned
- “ISOLATE + CHILL” Entertainment Pack – Playlists and Free Stuff – Click here or fill in the form below and we’ll email it to you right away!
- COVID-19 & Share Market Analysis
- Australian Banking Association Website – Financial Hardship
- ABC News: Data shows coronavirus can only be controlled if 8 out of 10 Australians stay home
- Full RBA Reserve Governor Philip Lowe Speech
- Make Money Simple Again (Free Book)
- Episode 276 | COVID-19 & Property Outlook
- UPDATE | Monetary & Fiscal Stimulus Program – What you need to know about them
And here are the Questions!
Question about “Investor & Tenant Relief” from Greg:
Any talk from the banks/government on providing relief to Investors on investment lending so as to enable them to provide relief to tenants who find themselves in financial trouble? For many owners they would have tenants they don’t want to lose and would like to assist (if required) but may not be in a position to do that themselves…
Question about “The Six-Month Freeze” from Jake
Points to consider for the six-month freeze 🥶 on home loans? Ie. how is the loan recalculated after six months? Will interest still be required to be paid during the freeze? And could this result in household having higher repayments on completion of the six-month freeze? Will it impacted your credit file? Cheers 🤙
Question from about Property Prices Dropping from Nicole
I just heard that Economists are predicting a 20% drop in house values. Would love your thoughts on this? If one is to take up the banks offer of 6months “off” from the mortgage — besides extending the loan time frame, how will it affect households and do you advise it in what circumstances?
Question from about Waiting To Buy from James
My partner and I are looking to buy in Queensland later this year. But are we better to wait until next year to buy?
Question about “What the market will look like next year” from Jarrad
Question about Offset Account Protection from Matt
Are offset accounts protected by the government up to 250k? Should I move funds above that to a different offset account, or should I use it to pay down principal on the loan? Would this then secure these funds in the hopefully unlikely event that a bank failed. Note that this is not a big 4 bank.
Question About “Accessing The 10k Out of Superannuation” from Daniel
If we have money in an offset account, can the bank access it to reduce their exposure?
Also, not sure if you can answer, what are the new rules around accessing your super? If you’re a couple can you both access the $10k per FY? Is it means or asset tested?
Question about Finding a Remote Property Investment Advisor from Aaron
Was about to redo mortgage and borrow additional funds for deposit on 1st investment property (which we are not really sure on the process, have to talk to mortgage broker),but now that everything is closing down not sure what our next steps are. Can we find a property investment advisor completely remotely? Is it a good time for a newbie investor to try and get into the market, when our only knowledge comes from the podcast and your book?
Question About What To Do If Tenants Can’t Make Rent from Rebecca
I am a single Mum with no family support … I have two investment properties but if tenants asked for ‘free rent’ don’t they realise that the landlord might be in a similar situation to them??? That this doesn’t make sense for tenants to ask for a pause on rent when mortgage payments still need to be made. I realise that some banks have waived the repayments for 3-6 months but I am actually not with the BIG banks who are doing this (WOW – it is impressive that it IS the big banks who are offering this support – makes me wants to transfer to one of them!)… any thoughts?
Question from Andrew
it would be great for you guys to canvass the current situation around landlords insurance and what policies will and will not cover in terms of loss of rent due to coronavirus circumstances. ie ….Actually getting Coronavirus and not being able to work vs being laid off because of economic difficulties. I can see this being a bit of a snake pit in terms of insurance policies and wordings associated with ‘pandemics’.
Additional Helpful Resources on COVID-19
National Update: Click here
- Australian Capital Territory – Click here
- New South Wales – Click here
- Northern Territory – Click here
- Queensland – Click here
- South Australia – Click here
- Tasmania – Click here
- Victoria – Click here
- Western Australia – Click here
One Final Word…
And please… Just a (not so gentle) reminder. Stay at home if you don’t need to go out. Download our Isolate + Chill Pack if you want to use this self-isolation time to learn new things!