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277 | Coronavirus & Property FAQ

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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… 

  1. “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) 
  1. “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 

  

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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 

What will the market look like next year? Would it be a good time to buy if I was planning to buy my first property? Could it be a good time to get a great priced asset? Thanks guys 

 

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

State Update:

 

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!

Free resources: Isolate + Chill

Fill in the form below and we'll email you all the playlist links and bonus resources right away! 😉

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Bonusisode | The Changes to Broker Regulation that will Impact Investors

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We’ve got Phil Tarrant from Smart Property Investment Podcast and Alex Whitlock, the Mortgage Business Director at Momentum Media for today’s Bonusisode folks!

What are we chatting about?

Well, it’s all about the future of the mortgage broking industry following the Banking Royal Commission’s Final Report and how will it impact the consumers moving forward.

It’s not very often that we have a trade-specific podcast, but as this will have a significant impact when it gets rolled out, we thought it’s crucial to increase the awareness on it.

Here are some of the links that we spoke about…

 

p.s. If you like this episode, make sure to check out Episode 218 | The Warning Signs of an Economy in Trouble as well!

 

198 | Nine Ways to Navigate the Credit Crunch

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Folks, if you’re playing the long-term game in property investing, you’ve got to know how to navigate the credit crunch!

And what do we mean by this??

… You MUST build financial muscle in order to succeed at the game of lending! Because folks you can NOT save your way to a passive income. You just can’t.

What you need is access to credit and an ability to optimise this credit so that it works in your absolute best interest.

But of course, there’s an elephant in the room here, isn’t there??

The lending landscape has changed, folks! This can be seen from APRA’s lending restrictions all the way to the banks feeling the pressure following the Royal Commission — both of which are just the tip of the iceberg property investors are now facing when it comes to accessing finance.

So. Here we are at the messy middle…… how can YOU cut through these challenges and still get the lending results you need??

Well, we’ve got 9 Tips up our sleeve to help you do just this folks!!!

 

Before we kick off the key learnings, here’s a couple of reminders from today’s episode…

1. Have you got a copy of Make Money Simple Again yet?

Grab a copy with 20% Discount here! Just use this coupon code: TPC20

Not ready to buy the book yet? No worries! Just download the Free Chapter here and check it out. 😉

 

2. Looking for the Facebook Group? Click here to join!

 

 

 

178 | Q & A : Is that 4th Bedroom Such a Good Idea? APRA’s Affect on Credit Cards & What’s The Secret to a Career in Property Investment?

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If you’ve got a question about investing in property, then it’s in your best interests to listen to this episode!

Why? Because it’s our favourite day, folks… Q & A Day! And, not only is today just a couple of days away from the end of Financial Year, but also we’ve got some new, timely SpeakPipe Questions to answer! Which means … 1. It’s probably a bit too late to get your Depreciation Schedule into your accountant, BUT 2. You’re in for a high-powered learning session!

This Q & A is great for folks who…

  • Want to know how APRA’s regulations have impacted your ability to get a loan AND a credit card?
  • Are you seriously interested in getting a career in property investing and want to how to land a job?
  • Aren’t sure what tenants are REALLY looking for in your area, but want to maximise your returns?
  • Thinking about renovating tips, but don’t know if you should add a bedroom or where to put the toilet?
  • Wondering if it’s a good idea to live in your property BEFORE you rent it out?

 

So if this sounds like you, you better strap your headphones in!

 

But, as routine has it, before we tell you EXACTLY what the questions are that’ll give you all this invaluable information, we’ve got some housekeeping to get out of the way, like…

Our Melbourne LIVE Podcast has SOLD OUT!!!

We even did a dance about it! WATCH OUR FLOSS DANCE!

Yep, it’s true, folks! But if you’re lucky, another local listener might have something come up on the night, so you COULD land their ticket. CLICK HERE if you’re keen to join the waitlist, or find out more details.

 

We’re hiring!!!

Our company is currently looking for new members, so if you’re qualified, passionate and prepared to do what it takes to help other people, we’re looking for:

Interested? Send in your Resume and Cover Letter to [email protected]

 

We want your Money Hacks

If you’ve got a great Savings Tip or a way to make your dollar go that extra mile, we want to know about it! Let us know here.
If you have implemented the Money Smarts System where do you feel most vulnerable? Let us know here.
If you want to be a Case Study and you’d like to know how Money SMARTS can help you, let you know. Let us know here.

Remember to leave us your SpeakPipe Questions.

 

Question about Ideal Rooms and Features of Investment Properties from Joel:

Hey Bryce, Ben and Stiggy. My name’s Joel, from Adelaide. The question I’d like to ask is what kind of rooms and features do Australia’s want in the rental market at the moment? The property I’m looking at the moment is a 3BDR, open living area & a large home entertainment, or cinema, room. Now, looking at the plans, I’d probably convert that room to a bedroom, add some wardrobes, because it’s quite large, but I don’t know what other Australians would want. So I’d live there for a couple of years before renting it out, but I don’t know what Australian’s would prefer another bedroom, or that extra room for activities and stuff like that? Any input would be great, thanks!

Have a Similar Question? These Episodes will also help:

 

Question about Bank Assessment of Loans from Matt:

Hey guys, Matt from Canberra … via sunny London here! First up I can tell you our architecture and Land Tax in Canberra is just to make sure not too many of you and the other Capitals turn off the Hume Highway and discover Australia’s best kept secret. So thanks very much for helping to keep our secret safe there! My question is about the banks and them having to assess us against increasingly restrictive assessment criteria. But do they have to do that when they are looking at non-mortgage lending criteria? The Money SMARTS System works best with a nice, big credit limit with maximum interest free days and there’s sometimes great deals on car loans that are cheaper than the interest savings on our offsets this is often still with APRA regulated providers. But do they only assess you against the lending criteria for the lowest common denominator, essentially, when you’re applying for a mortgage vs non mortgage finance? Do they have to assess you for the same criteria with their other products? Thanks so much guys for everything you do!

Have a Similar Question These Episodes will also help:

 

Question about getting into a career as a Buyers Agent and Property Investment Advisor from Francis:

I know that this topic has been touched on in the past but I would love to hear Ben and Bryce give a few pointers to people (like myself) wanting to make a career in property investment, Buyers Agents and financial planning. In my case, I have done the REIQ (QLD) registration course but wondering if I need to complete the full license? Also, if I want to help people buy property in every state and territory in Australia, do I need to go and complete that course for each and every state / territory to become registered, or does the buyers agency take on that responsibility? Other than the QPIA course, are there any other ways to learn the industry while still working, so that people can transition into their new career relatively seamlessly? I just thought I would send this to support my recorded message and give a little more context to the question. Thanks again for everything you are doing!

Have a Similar Question These will also help:

 

P.S. Have you cut a full lap of The Property Couch yet? If not, and you’re too strapped for time, just make sure you MUST WATCH the first 20 episodes. Because they are FOUNDATIONAL episodes.

CLICK HERE to listen to our very first Episode

 

 

176 | How to Prioritise Your Property Investment Journey and Still Have a Life — Sydney LIVE Podcast ft. Q & A

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If you’re reading this, you’re probably keen on property investing — regardless of whether or not you’re a beginner or a multimillion-dollar property portfolio owner… or somewhere in between.

And chances are you also like to have a life too, right? Because folks, at the end of the day, while hard work’s rewarding and a passive income’s exciting, there are also other factors competing for your time and attention, and — let’s face it — other things you’d prefer to do, like put your feet up (and watch the Pies and the Dockers if you’re us), or simply relax with your loved ones doing what YOU love most.

Realistically folks — if you invest in property the right way from the get-go, you shouldn’t have to sacrifice your life. It’s that simple. But it’s not always easy to get this balance right.

So, that’s where today’s VERY SPECIAL episode comes in. Yep, it’s very special because…

  1. It’s OUR LIVE SHOW IN SYDNEY where we answer our Property Couch Tribe’s questions… which just might be very similar to the ones YOU have!
  2. It’s a LIVE GUIDE to help you prioritise your property investment journey AND still have a life!!

 

Yep. Reclaim market confidence, get through the “messy middle”, cut the noise and let’s get some good ol’ honest advice!

 

*** Oh, and folks — make sure you tune in till the end for a special announcement from Ben! ***

Back to today’s questions answered at OUR LIVE SYDNEY PODCAST…

Question about Staying the Distance from Louise:

My single biggest challenge with my property investment journey has been keeping the momentum and not getting distracted or bored along the way. Property investing for the long term seems to sometimes move at a glacial speed and it’s easy to get a bit disheartened when you don’t see obvious progress. It’s also easy to let life get in the way and not prioritise my investment journey. I delayed on a purchase by two years (missing out on some great capital growth) because I was distracted by family and work life.

 

Question about Location and Investing in Cashflow from Yuna:

Ben and Bryce always talk about how location is the key and that most of the time 80% of the lifting is done by location. If my property investing strategy is cashflow rather than capital growth due to my circumstance; how do I apply the location theory to this equation? Or does location come first or my strategy during the suburb research?

 

Question about Off the Plan and Exit Strategies from Jeremy:

A ‘friend’ (who may or may not be me…) has purchased an off-the-plan, high-density unit, in Brisbane’s middle ring northern suburbs — 10km from the city. The area has a Westfield, a hospital and a bus line, but isn’t within walking distance from any of the new transport infrastructure projects. The build date has been pushed back from 2018 to 2019, because the developer, who was also the property spruiker, had difficulty getting pre-sales. Since that time I (or my friend) have discovered The Property Couch and have listened to as many back episodes as possible. It’s obvious to us that we can pretty much check off every mistake in the book. The spruiker was selling in Sydney with a focus on bling, tax depreciation and yield. The suburb is not investment grade. The property is not investment grade. Lifestyle drivers are not there. Income is lower than the QLD average. And so on. The unit was sold with a vendor discount: “stamp duty paid,” (yes we know…now), so on settlement is likely to be valued significantly less than the purchase price. With the over-supply situation that exists in Brisbane and Brisbane-North’s very low population growth rate (1%), what, if any, exit strategies exist?

 

LIVE Question about Knowing When to Stop:

How do you know when to stop investing in property? Because it’s pretty addictive!

 

LIVE Question about The Budget Changes to Tax Depreciation:

This is a bit more of a specific question, around the latest budget changes around tax depreciation. I have 2 properties that were purchased prior to the changes— so I have depreciation reports, and claiming all that’s all good. But I have bought 1 that settled with the changes the latest budget. I’ve heard on various podcasts about being able to claim the cost of plant and equipment as capital gains at the end if you sell, but I don’t understand the connection between these? Do I need a tax depreciation report for a property purchased after the budget last year to know what I owned when I purchased it to at the end when I sell it?

 

LIVE Question about Spruikers and Not Knowing How What to Do:

I’ve got a friend who is helping people buy property in Brisbane — they’re friends of ours — and they’re Off the Plan stuff, just terrible stuff really, and he works for a company where they deliberately fence people in, cross-collateralise, deliberately put them to their Buyers Agents who are hooked up with developers, and it gets me a bit angry. I can’t do anything about it because I have no credentials — I’m a Tradie — but I’ve been listening to your podcast for a number of years and I do have a lot of knowledge. Do you have any advice for someone who is witnessing these terrible things happening to people that I care about?

 

P.S. Want us to come to your city? Let us know what state/territory you live!
(We promise not to stalk you)

P.P.S. Want our industry to be regulated so we can get rid of the spruikers and dodgy investment advice? Join PICA  – it’s only $5 for 1 Year Membership!

 

 

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