“Average hardworking landlords” in Melbourne are apparently being slaughtered by falling rents and rising rental vacancies:
Melbourne landlords are struggling under the burden of reduced rent payments and finding tenants during the coronavirus pandemic.
Self-funded retirees without access to the pension are notably slipping through the cracks, with many of them reliant on rental income to cover their expenses…
“Many are looking for cheaper property managers to shift their investments to, because of lost income and rent cuts,” [Collings Real Estate head of property management Caleb Pikoulas] said.
“Some are going to suffer long into the future”…
“Everyone ignores that there are average hardworking landlords that are not rich and have to work tirelessly, saving and sacrificing to not become a financial taxpayer burden as they age.
“We need to encourage investors to become residential landlords and provide a housing service society needs.”
We’ve witnessed similar tales of woe in Sydney.
For years, Australia’s army of renters copped it in the neck as Australia’s most protected class on rentiers – landowners – made like bandits.
Now the tables have turned, with landlords facing an outright rout from collapsing immigration, widespread job losses, and Airbnbs flooding the long-term rental market.
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“Average hardworking landlords” : getting money because you own something is hard work?
Thats the capital in ‘Capitalism’ more important than people. Swing to capital since the 1970;s has been massive. Now we are in the far reaches of corrupt crony capitalism, ie we have a 3rd world structure to our politics and economy. I see this as an ignorant nobody with zero economic or political education.
What I dont see is many proper economists describing it in these terms.
Yanis Varoufakis: https://www.youtube.com/watch?v=hIe5VED8YOI
One of the only ones who calls things as they are
Eh I thought capitalism is people with more grey matter exploiting the people with less grey matter for personal gain must been wrong
That’s because economics is dominated, root and branch by a warped Keynesian / monetarist hybrid. There are few, if any, Unis in the world that actually teach classical economics anymore. Sadly it’s all quackery, which means we are doomed.
i dont agree with this statement. we have a hybrid corporatocracy/kleptocracy. capitalism died decades ago. economics as a field of study is a joke. consider the fundamental assumptions: everyone behaves rationally and everyone has access to perfect information. it just deteriorates from there………we are in the end game , hopefully some form of distributed capitalism emerges, along with the emerging distributed energy architecture, there is hope here to reform the world economy, but its not looking good as we bailout everyone particularly the ruling elites first! maybe i misinterpreted you dominic, ploise exploin?
There are essentially two broad schools of economics: one that studies it from an objective perspective and the other that demands intervention in the economy to make it ‘work more efficiently’. The latter is the school that dominates policy and it’s aims have nothing to do with better outcomes but rather outcomes that suit Govts. It’s not possible for a Govt (or any other body) to allocate capital more efficiently than the market because the Govt is driven by political concerns while the market concerns itself with growing capital.
The faulty system we have is a direct result of interventionism and all the bad things that you list above are merely an outgrowth of interventionism. We will never get back to a system that works efficiently and for the broad benefit of society until intervention is discarded as a policy. Govt should concern itself with being what it should be – a small administrative unit that serves the broader economy, not try to run the damn thing.
Looks like Aus/UK/USA have got the worst possible governments to deliver a new economic outlook post virus. Not only is it against the nature of their political inclinations, they are all corrupt nut jobs to boot.
+1 And none of it is actually based on, or takes account of the natural world.
externality mate. externality. the current capital bias is a violent arbitrage of all things natural and labour
100
and we are fast expending our environmental capital
yep okay dominic i dont disagree with any of that. fair enough and well said mate!
Michael Hudson speaks here on “unearned income” the only kind of income that should be taxed and yet it’s taxed the least!
https://youtu.be/mH8FWrbzxEs
He also speaks about the difficulty students of heterodox economics have gaining employment after graduation and how are all the major peer review economic journals are owned by right wing think tank organisations leading to almost total groupthink on all matters economic.
On par with the majority media (which these think tanks are in bed with, for eg IPA Murdoch press) and now the ABC has a board full of LNP cronies controlling the propaganda. Some might call this the pathway to fascism.
@ EP
If cons piracy folk are to be believed the only think tank that counts in any field is:
Tav i S tock
30 Tabernacle St
Shoreditch
London
Umbrella group founded early last century sheltering:
Education curriculum University, Medicine, Psychology, Psychiatry, Surgery, Pharmacy, Literature phenomenons – Harry Potter & 50 shades, Or well, Hux Lee, , History,, Economics, culture : every thing
Social conditioning 101 mates of Freud, Jung, Laing & all the grand daddies & grannies of psychiatry
Ermington Plumbing, re Michael Hudson: Harold Wilson 1964, UK Labour Leader: “Labour is for the money earner, not the money maker.” To his credit Shorten took the first steps to rebalance the playing field between capital and labour at the last election. The ALP forgot Wilson’s saying in recent decades and should not so do again
Great link, thanks for posting.
FMD (F me Ded)
No words…
“Everyone ignores that there are average hardworking landlords that are not rich and have to work tirelessly, saving and sacrificing to not become a financial taxpayer burden as they age.
So what about the tireless hard workers? They’ll always land on their feet. I really feel for the feckless, indolent speculators.
Is it ok to say Ive never cared less about a ‘class’ of people.
Easy come easy go
Never let it go o o o o o:)))
Reduce the rent
Meet the market
“Self funded retirees” – those with multiple properties and asset rich..So They could easily un 3% of their assets each year for 30 years or reverse mortgage – instead of planning a 5 Million inheritance. and then anyway they get a pension also ..Compare to the unemployed renter on insecure low income or newstart…
Shoukd hear my landlord whinge from the heart. Getting huge return and ses he has never seen anything like this. I will leave soon from the semi posh by cost hellhole.
No time for that sort of stuff,
Our illustrious media is focused on the issues that really matter
https://www.news.com.au/sport/more-sports/john-adams-slams-abc-sydney-radio-show-for-discussion-over-whether-chess-is-racist/news-story/5a4b7fa1e996810dde60fc5f4d9fff48
The ABC have taken the view that chess is RACIST given that white always go first!
“They are seeking comment from a chess official as to whether the rules of chess need to be altered!
A hoax? Their ABC should be a Subscription service. Why should I pay for the employment of such poor “journalists”.
Oh dear
😂
Ordinarily you would think it’s a joke, but in this day and age ..
What does “going first” mean? As a topical example, I don’t think most people are happy to be “going first” in a round of redundancies.
Put pianos into the mix as well. From now on only harpsichords are allowed.
Lol. The arts are stuffed anyway
…..and ban piano accordions and to hell with all that European folk music – raycist the lot 🙂
Well,…They are all White Cnvts after all.
And that automatically confers racism, of course
With JobSeeker and JobKeeper implemented it’s time for a new payment RentSeeker. I’m sure ScoMo will announce it soon enough!
nice
Nah, should be called ‘rentkeeper’
RentSeekerKeeper
All those payments could be bundled under the heading of Rentseeker.
There is nothing more rentseeking than sitting on your arse at home picking up free government money in spite of the random hierarchy of worthiness bestowed on individuals by the echo chamber.
But not to be outdone by the LNP’s most outrageous handout, ExcessFrankingCreditRefundKeeper, for its truly privileged leaners, who are missing out on a bank dividend and those to-die-for franking credits for the first time ever and are finding it hard not being able to upgrade to the newest Merc and luxury cruiser this year?
Don’t be daft dear boy
Most of Australia is already on rentseeker – those of who matter anyway
Hello, my name is DisplayName and I am a Rent Seeker.
I’m sorry. That support group is next door.
you win the macrobusiness comments title today gav.
Thank you.
👋✊💦
I don’t think there is an emoji for stained underpants.
🩲💩
https://youtu.be/aZHvd0ks7Es
Pretty sure this meme is now racialist..
If you do a wh!te poo I think it might be time to see the doctor…
You’d be right Gav, but contrary to Tucker’s question of how we got here, and claim that it “happened almost overnight”, it’s been brewing since the 80’s.
It’s happened over decades of indebted youth and lower income workers gradually losing wages, jobs, housing, bargaining power, and not daring to protest out of fear of job loss, bankruptcy and homelessness – which is exactly where the crony corporate capitalists (CCCs) wish to keep them while pocketing obscene unearned profits made at their expense.
Finally, knowingly or not, the workers and youth have found a way to protest decades of dispossession, wage theft and indebtedness which the CCCs have knowingly loaded them up with, but now don’t dare touch them with.
All power to the dispossessed and good luck to them! Bring on the great reset!!!
https://youtu.be/_YahDLTODDg
All those average, ordinary, hardworking mums and dads just trying to get ahead.
Who? Tenants? Oh yes, they might have a shot at getting ahead now.
Yes as I said in my comment below, the mum and dad investor are to be protected at all costs. Want to fire proof your investments? Have a few roots and get a few on the ground. The world will look upon you and your investment throws with great favour.
They could sell and do away with the stress, but then they’d have to make money some other way, poor things.
make money? those who own IPs outright don’t complain about rent reductions
most of these who complain are still losing money on their IPs while trying to make capital gains …
if they sell now many would probably not be able to repay the debt
+1 they are well underwater. That’s the gnashing of teeth you can hear. I mean they don’t call it negative gearing for nothing. You’re geared to go backwards.
And I believe that SMSF don’t even have the NG tax break, that must hurt even more when capital losses mount.
Actually work hard to get ahead? That’s un-Strayan.
I just don’t se what the problem is.
Just get Treasury to create a whole heap of Ancillary Rental Bonds; offer them to The Market at a knock-down yield and allow them to be repurchased as Qualifying Collateral by the RBA and use the proceeds to pay, let’s say all, the rent of anyone without their own home. and take the stress of being a landlord away.
There! Problem solved.
Yes but the tenant may benefit, and that’s not kosher in the land of capitalistic serfdom. (ie Aus UK, USA and other countries run by 3rd world dictators)
Could we establish a derivatives market based on your idea? Ah, door bell’s ringing. My Havanas have arrived!
Definition of passive income. Problem isn’t with property investors as a theory, just the greed involved.
You aren’t owed a risk free return on any investment, but people were sold that. So many got extremely rich of the backs of others, whilst never even realising the cost of their win.
Let em burn.
The problem is the debt based money system which is inflationary. If we didn’t have to suffer this there’d be few, if any, capital gains to be made and IPs would be dead to mom and pop investors. They piled into a Ponzi scheme quite willingly and are reaping the whirlwind.
Spot on
Which is why those printers are working double time now. Gotta get that inflation fairy ticking!
And most ( if not all of them) know the jig is up and logic side of brain is screaming ‘get out’!. However, ‘greed’ is fed by dopamine and in addition to ‘liking’ the results of getting capital gains as many have, the *anticipation* of receiving such benefits drives much of the participation in property.
All fiat currencies not backed by gold or silver eventually fail and right before they do, a counter -intuitive lift in asset prices from the activities of central banks is the unmistakeable ‘tell’ that collapse is incipient.
https://seekingalpha.com/article/4354917-crisis-goes-up-gear
yet the current system is in many ways deflationary as technology displaces labour. its fascinating to watch as a mania/bias/dissonance standpoint because clearly we have inherent structural issues that will cause collapse via deflation/inflation/hyperinflation. i dont know which way it plays out but PMs are a good hedge in the short humans trade?
ew. Productivity increases and technological advancement are inherently deflationary, which is to be celebrated – because it allows all of us to buy more goods and services at a lower price. However, deflation is a threat to a debt-based money system because such a system can only survive with perpetual inflation so boosts to monetary inflation are required from time to time (central bank administered) – and increasingly so over time — until the system inevitably busts.
already in retirement? Will not really suffer long into future … coronavirus may also help end that suffering sooner especially if it becomes seasonal
BTW. I don’t remember anyone ever mentioning renters following RBA rate cuts. All of the benefits were always going to landlords
Indeed. With all the rate cuts I never had my landlord give me a rent cut.
You need to stand by your commitments and ensure these retirees are able to afford their annual trip to Europe. No, really …
Laws need to be enacted that ban reducing rents or moving out! Thankfully I believe Victoria has introduced similar laws already which is great but don’t go far enough to protect landlord profits. All other states need to do this asap too. I am confident they will.
and tenants need to be forced to put additional 12% of rent into landlords super account
otherwise landlords who live only from rent would not have any super so they will be getting aged pension
@Reus
Absolutely. Had a couple of tenants flogged the other day to encourage the others as the Frogs say. Haven’t been back yet as I had a puncture this morning on the way to the rental estate.
Ran over a milk bottle – damned fool had it in his pocket..
nice
My brother in law reports from vybrant central in Sydney’s west (2145) that the kerbside junk piles of rain sodden melamine Target furniture, K mart rice cookers and discarded used nappies are growing like weeds in front of the unit blocks as the for lease signs flourish.
In the same street 2 years ago it would be modest, not massive, numbers going to Saturday AM rental inspections but the place would be rented by the following Monday arvo as the RE agent with a spring in his step took down the for lease sign.
Now the RE agent (who treated BIL like right renter scum when he leased him the place 2.5 years ago) is seen doing the bins, leaf blowing and general tidying in the block (presumably having dumped the contracted cleaner and doing this work to replace collapsing commission income).
Know this c.h.u.n.t.s: the only game in town for Scummo is getting the migrant floodgates open again, no matter the cost. We go into FQ42020 with the drawbridge still up and it’s game over.
if ScoMo opens the gates … will they come to be unemployed here?
I think so.
this is expensive country … to come and be unemployed even only for few months, they’ll need quite a lot of money … enough to make them financially well in their home countries
in early nineties gates were as open as before or after but not very many were arriving
Did somebody say ‘Menulog’?
What a great move that would be for the Libs. Open teh flood gates so that the ABC/SBS can whack the govt with nightly reports from the soup lines.
I like how the ABC is gingerly reporting that the Vic govt is sending multi-lingual officers out to multicultural suburbs to ask them to stop spreading Covid since theyre risking the reopening of the entire country. ROFL.
@ Dr x
No problem
The racist rhetoric will be so ingrained that any being that lands in Oz sporting skin shade darker than Whyte will immediately qualify for citizenship, Medicare, job starter, rent seeker, jobskil, free tafe, subsidised uni, free English lessons, interpreter, auto drivers licence issue, subside rent, free accomodation, emergency housing hotel with meal voucher, first homeowners grant, free primary education for offspring, govt grant sponsored support groups, support police officers, Newstart, dole, NEIS, NDIS, elderly in home support.
I know I missed a few and I’m wrong cos most of this already in place. WLDM
You’ve nailed it doctorX. ABS historical stats clearly show that as unemployment rises immigration falls.
Prospective immigrants cannot afford to move and then be subjected to possible or certain unemployment. The maths simply doesn’t add up, hence the masses act accordingly.
Quite so
There are whole suburbs in outer Melbourne which have become like this, not just recently but as landlords have taken over what were once boring but acceptable suburbs at the low$ end of the market. Tenants dont give a f*k and landlords neither. Prices have gone up though. Would be nice to see them have to sell at bricks and mortar value sans inflated land value.
When you consider the quality construction of some of these places, bricks and mortar value is akin to junk bond status.
I had to Google 2145. I thought anything further than Croydon was too far West in Sydney.
It’s Westmead, otherwise known to the locals as Westmumbai. Visited once, never again. Thinking of it now makes me happy about this morning’s fatwah from Gladys about not mixing with us Melbournites.
Where’s Croydon?
I get nervous crossing to the west side of George St.
You’ve gotta laugh at the characterisation of the motives of landlords. Just wanted to avoid being a burden, and now they’re being punished for their selflessness. How could we allow this to continue?
Like feeling sorry for the feudal lords of old, poor buggers had to put up with draughty castles while the serfs got to enjoy the sunshine….
Yes they saw a homeless person on the street once and they developed a burning desire to house people. Any financial gain from said desire is purely coincidental and an unexpected but warranted piece of good fortune
Just the natural outcome when you step up to join the lifting class.
Yes, how diginified of them to lift themselves up with other people’s bootstraps…
Burn burn burn bitchez
Meanwhile. left-handed mouse sales are through the roof!
“We need to encourage investors to become residential landlords and provide a housing service society needs.”
FCUK me I nearly threw up in my mouth when I read this, how about letting people who need a home afford to be able to buy them rather than be stuck with a lifetime of renting from a ass-hole specuvestor …..
You must be the “good” Reusa
Its heartbreaking. Two phrases keep recurring, especially at the hopeless ABC news website. What is wrong there? Every day another story about some guileless palooka who is doing their bum on investment properties. Never a story about renters winning out from the falling market. The ABC is supposed to be for all Australians but its really just for Big Australia and the associated property bubble. Anyway the two recurring themes. “The mum and dad investor” – ok, so Bill and Doris had a root or two and put a few on the ground. Somehow this makes their investment more worthy of sympathy and protection than childless people who invest. I havent had the phrase “barren investor” or “infertile investor” or “childless by choice investor.” They dont deserve any sympathy or protection. The other one is the old chestnut “I invested in rental property to save for my retirement.” Gee, so the person who invests in term deposits that have been smashed by the property bubble interest rate cuts is not saving for their retirement? Or the person who is a gold or silver stacker, they are not saving for their retirement. We are all saving for our retirement. Not all of us took a punt on the world’s biggest property bubble. Its been a good investment for some years but anybody who visits this site has been advised of caution in the last five or so years. Tough luck, tear up your ticket, form guide to hand, next race.
Steady on there Astrolin – the rant meter just went off the scale… And anyway, what about Dad & Dad, Mum & Mum and identity confused investors (ICIs)? Surely a huge hole in the ABC’s normally high class reporting..
Ha ha, yeh, I am a veteran ranter on here, going back about seven years. Not ranting so much on here these days but I still can reproduce some of my old form. Speaking of reproducing you are suggesting a new sympathy deserving category. I am sure they will respond accordingly. Working poor, near destitute renters, not part of the ABC mission statement. High rents are good for everyone, thats your ABC
…because of course, being upper middle class, they’re all RE spekufestors themselves, lol
Once you borrow 9 times annual income, sperms stop swimming.
Agree 100 percent Astrolin. Love this rant and am buying you a virtual beer.
Someone needs to update this for the landlords
https://cheezburger.com/6078763008/politicians-before-and-after-elections
https://memes.yarn.co/yarn-clip/f7390c33-690e-45a3-bf58-4464096c0fe5
We have been waiting a long time for this, they had their feast, their banquet. They drank expensive wine laughed obnoxiously loud disturbing other patrons. They were rude to the waiter too. Now the feast has finished and the bill is due.
Nice work!
I am not seeing any major falls in Melbourne’s SE suburbs ie Clayton,Mulgrave etc.When can I see some 25% percent falls in these areas (given the fact that most people I know on private sector jobs have taken a 20% salary cut)
My guess would be in 18 months.
Lol. The only timeline that matters
When you invest, you take on risk, when you leverage, you multiply that risk.
When the relaxation on directors’ personal liability for trading while insolvent comes back at 12.01am on 1 October 2020 the SHTF
Isn’t it curious that Property Investors are only now figuring out that Renters (their Tenants) are not renting because they’re fabulously wealthy and value lifestyle flexibility, but rather because that’s all they could afford.
When the cash flow of your primary investments is 98% linked to the cashflow of of the bottom quartile of the workers in the economy, it goes without saying that your investment is F’ed whenever they’re F’ed and at the moment the bottom quartile are royally F’ed
Seriously does anyone really need to explain this to an “Investor”, one would assume that they did their Due Diligence and understand the business that they’re investing in. yet here we are!
These Poor Landlords need to accept the losses that were always a part of the “Investment”. This is the Risk which countless people have commented on over the past 20 years, what we are seeing is exactly this risk materializing and guess what it’s happening just as expected (as in the economy is entering a recession and the bottom quartile is (as always) the worst effected by a recession)
FFS these losses are their losses lets not get all sad and teary eyed because we’ve discovered that wishful thinking isn’t actually a valid business planning method.
But but real estate agents TOLD ME property doubles every 7 years…Or was it 10?
That might be true and might even continue to be true, but it has absolutely nothing to do with your Tenants ability to pay rent during an economic downturn?
What I find offensive is Landlords suddenly realizing that you can’t get blood from a stone nor can you get rent money from an unemployed tenant. And if every probable tenant is unemployed than you’ll just need to adjust your rent. This is a fundamental problem with any investment that is structured to make money from the bottom quartile, you’re F’ed when they’re F’ed furthermore if you count yourself as both a landlord and a worker than doubly F’ed when the economy turns south. Which is precisely why Mum and Dad “investors” probably shouldn’t have this sort of “Investment”
I agree. The only people who should be renting out property are those who have large buffers behind them to pay for proper repairs and upgrades, can survive for periods with it empty, and know when it’s time to bid the mob good-day….i.e. sell up. This is likely government built ‘rent to buy’, or large investment companies that know what they are doing, can hold sway with building companies for quality workmanship, and take a long term view.
Exactly,
If you look at the typical landlord in say Germany it’s an Insurance company.
In the US (at least wrt apartments) the landlord is something like a REIT (real estate Investment Trust)
These are big financially strong players that understand their responsibilities and the nature of the market that they are providing a product for. It is absolutely no news to them that the business of renting apartments totally stinks during a down turn.
Well phrased!
And, most important of all in this popular ‘recipe’, is that the IP loan remains and is payable no matter what happens.
The real ‘game’ is not the potential cap gains or tax savings (saw dust) enjoyed by the retail investor, but the acres of freshly cut and stacked ‘wood’ in the lender’s back book yard.
Someone posted this on MB a month or 2 ago, It was the first time I had heard this and I was in tears laughing for a good while.
https://www.youtube.com/watch?v=_ZEEgIti8sM
It sums up my feelings regarding the rentier class spectacularly, the miserable sinner & ar$e hole that I am.