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Episode 299 | Sell Everything And Run? Brand New Update From Leah Calnan, President of REIV

If you listened to last week’s episode, you’ll know already that there’s been significant changes happening on the grounds in the real estate industry… particularly here in Victoria with Stage 4 and Stage 3 Restrictions now seriously impacting what we CAN and CAN’T do when it comes to property transactions and inspections across the state…

And since then, we’ve heard from the Commonwealth Bank CEO Matt Comyn on the current health of one of the Big Four and the damage faced to our banking system as they act as “shock absorbers” during the COVID-19 crisis…

.. so the question now is… Is It Time To Sell Everything And Run? And for us living in VIC, Should we flog everything and move to Queensland?!

In today’s eye-opening Q & A, we’re unpacking ALL this, plus – as promised – we have a Brand New Update from Leah Calnan, President of the Real Estate Institute of Victoria (REIV) with further insights into what buyers, sellers, renters, real estate agents & property managers are legally allowed to do in COVID-19 Victoria.

Leah will also be covering what services can still go ahead with up and coming settlements and end of leases… and smart ways to safeguard purchases and sales over the next five weeks.

So. What are we in for?

 

Free Stuff

 

The Questions

Question on Finance from Matt Feeley

If I buy an investment property with equity release and create two loan splits (let’s say 100k equity secured against PPR and 400k home loan). If I sell the PPR in the future to upgrade the family home, what happens to the 100k loan that is secured to the PPR? What are the options? Thanks a lot guys!!

 

Question on Selling Right Now from Cameron Hall

Not really a question, but thought I’d share our experience selling our home recently. Went on market two days after Melbourne went into stage 3, but despite individual inspections and the associated hassle, there was huge interest (25+ groups), and it sold in 5 days, for what we wanted, and a street record     . In a pandemic. No shortage of demand (at least in our area) from what we’ve seen. Hope this helps anyone worried about selling

 

Question from Maximus Decimus Meridias

This is a buy, rent and sell question and although specifically about the Perth market, I think it is valid for all of Australia. The media reported last night that the Perth median sell price has slipped below Adelaide and is 2nd from the bottom with Darwin sitting below Perth. However, the rental vacancy rate is

$200 less than last month and about half of what it was this time last year! I believe I heard you say in a podcast a few weeks ago that potential sellers are holding onto their properties because they know prices are real low. But has distressed selling pushed the median price down? Or are the media looking at stats at a certain point in time which reflects a bad run of  lower cost properties being sold in distress or otherwise? All these stats don’t match up with what I’m hearing about rental vacancy rates in other parts of Australia either.

And finally, we are looking at rentvesting, yet is it better to look at buying in Perth right now, rather than rentvesting or does that depend on the suburb?

 

Question from Hugh Gates

Hi guys, currently building a granny flat on the back of my PPOR at the moment which will be leased. My question is will my serviceability for a future  investment loan be increased if I lease the main residence also? The flip side is that the repayments on the house are lower than the equivalent I would pay in rent ie. Repayments $330 a week, rental $450ish. However the rental income I would generate on the house would be equivalent to that of the rent I would be paying. (Balanced out I guess)

Love the show boys and Stiggy, have listened to the lot and have read one of  your books keen to read the next! Thank you for your time and commitment to bettering others futures be it financial or otherwise!

Edit: sorry NSW based not Vic!

 

Question from Tee Dee

With stimulus being used to prop everything up, is it fair to say that we can expect to see an initial deflation in the market (10-20%), followed by a severe inflationary period as the mass amount of new money finds its way to the bottom of the pyramid when everything opens back up via rents and prices? If we keep our current monetary system the only way to repay this debt is through mass inflation. That tells me to hold my assets,  switch to interest only (despite low interest rates), and pay off my debt using tomorrow’s, devalued dollar. Is this a naive way of thinking? Thanks guys

 

Question from Jamie Attard

I’m hearing a lot of hype of a tree change from our major cities. Is there data out there to back this up and what regional areas are benefiting from this if any?

 

Question from Heath Ian Sullivan

Thoughts on Queensland being bombarded with melbournites trying to  escape from the city?

 

Question from Sonja Mallia

What to do if we have over 200k in offset, and the banks can now use our money if in financial ruins and not pay it back?

 

One Final Word…

If you’re worried about your finances or if you have no clarity on your cash flow position, we strongly recommend you to organise your finances now. It’s more important than ever to have a clear view, down to the exact cent, on how much you’re spending each month and how much surplus you’ve got. If you don’t know it, then log in to your Money SMARTS Platform here and update the numbers.

Don’t have an account yet? Create your free access below and we’ll also send you an e-copy of the instruction manual which is also our best-seller book, Make Money Simple Again. Just fill in the form below and we’ll email it to you right away.

 

 

 

 

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