Speaker 1: Hello.
Speaker 2: My name's Santasha Nabananga Bamblet. I'm a proud yr the
Speaker 2: Order Kerney Whalbury and a waddery woman. And before we
Speaker 2: get started on She's on the Money podcast, I would
Speaker 2: like to acknowledge the traditional custodians of the land of
Speaker 2: which this podcast is recorded on a wondery country, acknowledging
Speaker 2: the elders, the ancestors and the next generation coming through
Speaker 2: as this podcast is about connecting, empowering, knowledge sharing and
Speaker 2: the storytelling of you to make a difference for today
Speaker 2: and lasting impact for tomorrow.
Speaker 1: Let's get into it. She's on the Money.
Speaker 3: She's on the Money. Hello and welcomed. She's on the
Speaker 3: Money podcasts for millennials who want financial freedom. My name
Speaker 3: is beck Syed and with me is Victoria Divine.
Speaker 1: How good is salt and vinegar chip?
Speaker 2: Ah?
Speaker 3: I was wondering if you'd be finished that mouthful by
Speaker 3: the time I'm talking.
Speaker 1: Nearly finished the mouthful. That was quick. I'm very impressed.
Speaker 3: It was not comfortable, no, very jagged going down, isn't it?
Speaker 4: But there is no better combination than sultan, vinegar, chips
Speaker 4: and watermelon.
Speaker 3: Oh my gosh, okay, I wouldn't have thought, but now
Speaker 3: they mentioned it, I can see yeah, because it's a
Speaker 3: bit juicy.
Speaker 4: I mean, you're not putting them in your mouth at
Speaker 4: the same time. Okay, you've got like a little snack
Speaker 4: of watermelon, which I do, and then you've got a
Speaker 4: little snack of salt and vinegar chips, which I do.
Speaker 3: Okay, got cha, gotcha?
Speaker 1: Gotcha?
Speaker 4: Anyway, were talking about Oh yes, okay, I forgot that
Speaker 4: we're doing a podcast so va it's actually a food
Speaker 4: podcast now for real shit foodies.
Speaker 3: Honestly, I'd be happy with that. So obviously, as you know,
Speaker 3: we are living in a world where rental housing has
Speaker 3: been increasingly converted into investment assets. It has indeed, so
Speaker 3: we've seen much debate in our lives in the broader
Speaker 3: community that people shouldn't own an investment property till.
Speaker 1: Everyone has a house. Spicy opinion.
Speaker 3: I would tend to agree, but you know there's complications anyway.
Speaker 3: So today what we're talking about is ethical landlords, so mean,
Speaker 3: is it possible? Also, what are our Australian values around
Speaker 3: renting and more globally, what's the landscape? I think first
Speaker 3: things first, there was not one circumstance that created our
Speaker 3: current housing christ sure, but literally hundreds of years of
Speaker 3: contributing problems income inequality, colonization, car centric urban sprawl, and
Speaker 3: urban renewal.
Speaker 1: To name a few.
Speaker 4: With such complex societal problems, I just don't think that
Speaker 4: there is a single solution that fixes absolutely everything back.
Speaker 3: So can an ethical landlord, in your opinion, exist or
Speaker 3: is this an Oxymoronah.
Speaker 1: It's such a spicy opinion.
Speaker 4: But there are so many different opinions on this, and
Speaker 4: it really depairs on your personal values.
Speaker 1: We can't answer that for anyone. Really.
Speaker 4: At the end of the day, it is personal, and
Speaker 4: that's the best part about it. You get to have
Speaker 4: your own opinion, and our entire community is a sea
Speaker 4: of different opinions and that's what makes us so beautiful.
Speaker 3: But there are lots of things landlords can do to be.
Speaker 4: More you could say, ethical and help with housing equality
Speaker 4: and access. In the second half of the show, Beck,
Speaker 4: we're going to talk about things to consider as a
Speaker 4: landlord to make the dynamic with tenants a little bit
Speaker 4: more ethical, and also discuss the difference between a residential
Speaker 4: owner occupier loan and an investment property loan, which I
Speaker 4: think are important to understand when it comes down to
Speaker 4: property ownership in general.
Speaker 1: Okay, okay, okay.
Speaker 3: As you know, Australia has very much had home ownership
Speaker 3: as one of our cultural aspirations slash expectations.
Speaker 4: Beck, it is the great Australian dream after all. Well,
Speaker 4: exactly everyone should own a property, right Beck. Well that's
Speaker 4: what they say, it's what might be the authorities say
Speaker 4: it's actually just our dads exactly.
Speaker 3: But obviously rising housing costs, economic recession and demographic changes
Speaker 3: have shifted that possibility in more recent history, and home
Speaker 3: ownership isn't a priority for many other countries in the world.
Speaker 3: Which countries are more rent happy and why.
Speaker 4: It's actually interesting to dive into this, Beck, because I
Speaker 4: think we live in our beautiful Australia bubble, right Beck, Like,
Speaker 4: we have these ideals that have been handed down from
Speaker 4: generation to generation that we should own property, right, whether
Speaker 4: you do or don't, it's something that in school you
Speaker 4: learned about. It's just something that is ingrained in our
Speaker 4: culture in a way. But that isn't the way most
Speaker 4: other countries are, to be honest, Like so many other
Speaker 4: countries actually have this expectation that you will rent for
Speaker 4: life and I mean, there's a lot to say around
Speaker 4: renter equality and how they're treated and how in different countries.
Speaker 4: There are lots of different benefits like longer leases, etc.
Speaker 3: Etc.
Speaker 4: That actually lean towards people being even more comfortable with renting.
Speaker 4: But here are the top five rent happy countries in
Speaker 4: the world. So Switzerland fifty six point six percent of
Speaker 4: their population rent okay, Hong Kong forty nine percent, Germany
Speaker 4: forty eight point one percent, Austria forty four point three percent,
Speaker 4: and South Korea forty four point eight percent.
Speaker 2: Beck.
Speaker 4: However, there are also, I guess on the flip side
Speaker 4: of that. When you keep going down and down then
Speaker 4: down the list, you could start saying that there are
Speaker 4: like people who own more than they rent. So in
Speaker 4: Singapore only nine point seven percent of their community rent
Speaker 4: oh Slovakia ten point seven percent rent Russia twelve point nine,
Speaker 4: Poland sixteen point three and Norway seventeen point two percent
Speaker 4: of people rent okay.
Speaker 1: Is that crazy? It is crazy?
Speaker 3: So what data is out there about countries within ingreen
Speaker 3: culture of property ownership?
Speaker 2: Beck?
Speaker 1: Because I'm a superherd.
Speaker 4: Recently, in lead up to this episode, I was reading
Speaker 4: an apps from a twenty twenty one research paper out
Speaker 4: of America called Rental Tenure and Rental Burden.
Speaker 1: Of course you were, yeah, of course, Savlos.
Speaker 4: But I found it really interesting and I have summarized
Speaker 4: it into four dot points that I can share with
Speaker 4: you so that you don't have to read.
Speaker 1: It for yourself. Would you like me to do that?
Speaker 3: Yes?
Speaker 4: Please, So rentals around the globe accommodate for one point
Speaker 4: two billion people. The data they found that the more
Speaker 4: developed the country, the more people tend to rent, and
Speaker 4: vice versa.
Speaker 2: Ah.
Speaker 1: This was most obvious in.
Speaker 4: Europe, where formerly communist countries have a high prevalence of homeowners.
Speaker 1: It is first and foremost a.
Speaker 4: Cultural thing, but laws and regulations in certain excommunist countries
Speaker 4: can make renting a nightmare.
Speaker 3: Two.
Speaker 4: While in Western and Central European countries like Switzerland and Germany,
Speaker 4: around half of the households were renting in twenty fifteen,
Speaker 4: in the czechs Republic, only two out of ten households
Speaker 4: were choosing to do so. Interesting in Russia and Slovakia,
Speaker 4: the share of renters is even lower. Only one out
Speaker 4: of ten households didn't own their home in twenty fifteen,
Speaker 4: and owning property is arguably the holy grail of the
Speaker 4: Eastern European society, a much coveted and highly valued right
Speaker 4: that was once taken away. So long story short, the
Speaker 4: further east you go in Europe, the more people own,
Speaker 4: and the further west you go, the more people rent.
Speaker 1: More or less.
Speaker 3: That is so interesting. I wonder why that is culture communism.
Speaker 1: I won like about the developed nations.
Speaker 4: And it kind of makes sense, right, The more developed
Speaker 4: a country, the more people rent because property prices are
Speaker 4: significantly higher. Yeah, and you think about this in high
Speaker 4: density environments. And I think the best high density environment
Speaker 4: that I think we all know about is New York, right,
Speaker 4: So we all know inherently the New York property is cooked, right, Like,
Speaker 4: no one in New York basically owns. They all rent,
Speaker 4: and they do so because it's like a central business hub,
Speaker 4: which is incredibly expensive to live in. So the more
Speaker 4: developed your country, not necessarily talking about America in general,
Speaker 4: it's just an example, but the more developed the country,
Speaker 4: as we know, Switzerland is pretty good. YEA, like Switzerland,
Speaker 4: they're bullers, they know so much stuff like, they are
Speaker 4: full of rich people as well, But fifty six point
Speaker 4: six percent of people rent there because I'm assuming.
Speaker 1: Coperty prices are astronomy app Yeah, so that makes sense,
Speaker 1: That does make sense.
Speaker 4: And Australia we are billions years old. Yes, but since
Speaker 4: the white people invaded Australia there has been two hundred
Speaker 4: years of development, and that is so little in comparison
Speaker 4: to the development that international countries have had right around
Speaker 4: the world. It's been thousands and thousands of years. And
Speaker 4: now Australia is kind of going, oh, actually we're becoming
Speaker 4: incredibly developed and land is becoming a resource that is
Speaker 4: actually limited, whereas before with our population and how big
Speaker 4: our country was. It's a great Australian It's very easy
Speaker 4: to buy property as cheap as chips.
Speaker 3: Sure not anymore, not anymore. This is a really good
Speaker 3: time to go to a quick break.
Speaker 1: I think we should go to a quick break before
Speaker 1: we get real heated. Yeah, I think so.
Speaker 3: On the flip side, we're going to be discussing the
Speaker 3: difference between a residential owner occupy alone an investment property loan.
Speaker 3: Sounds fun, plus some things to consider as a landlord
Speaker 3: to make the dynamic with tenants more ethical, stunning, don't
Speaker 3: go anywhere, I got it, okav We are back. And so,
Speaker 3: as I mentioned before the break, we are going to
Speaker 3: be talking about some key points of residential owner occupy
Speaker 3: alone and investment property loan. Are you ready?
Speaker 1: I'm very excited.
Speaker 4: Would you like me to read the key dot points
Speaker 4: that I listed for this part of the conversation?
Speaker 3: Yes? Please?
Speaker 1: You can't wait, can you?
Speaker 3: I can't wait?
Speaker 4: You're a liar, all right? So here are the main points. So,
Speaker 4: if you're getting an investment loan, borrowing is actually going
Speaker 4: to be different to if you're going to get a
Speaker 4: loan for a property that you're going to live in.
Speaker 4: Why because we need to take into account things like
Speaker 4: rent received, but also any rent payable or mortgages payable
Speaker 4: for when you keep living there. When it comes to
Speaker 4: investment loans, you can opt to pay what's called interest
Speaker 4: only if you want, which is where you aren't paying
Speaker 4: the loan down, just the interest portion of that loan.
Speaker 4: Or you could pay what's called P and I, which
Speaker 4: is principal and interest, which is paying the loan off completely,
Speaker 4: like not in its entirety, but like a portion of
Speaker 4: what you would pay each month would go to the
Speaker 4: principle and a portion would go to the interest, whereas
Speaker 4: interest only. You're only paying the interests, so usually it's
Speaker 4: much more cost effective in the short term, but you're
Speaker 4: not paying your asset off in the long term, right,
Speaker 4: so you can opt for interest only. However, it's actually
Speaker 4: way less common to choose this on the property that
Speaker 4: you actually live in and own right, So often it's
Speaker 4: an investment thing where an investor might go and purchase
Speaker 4: a property beck and go, I'm going to purchase this property.
Speaker 4: I've worked out the maths on it. The reason I
Speaker 4: am purchasing this property is because in the next ten years,
Speaker 4: I think it's going to.
Speaker 1: Double in price.
Speaker 3: Really great area, really great location.
Speaker 4: So I'm actually going to probably plan to sell it
Speaker 4: in ten years, so I don't want to pay any
Speaker 4: of the loan off stuff that that's silly to pay
Speaker 4: off the loan. What I'll do is I'm going to
Speaker 4: pay off just the interest portion.
Speaker 1: Of the loan, so I'll pay the banks their fees
Speaker 1: so that I can get the property.
Speaker 4: Then I'm going to sit on the property for ten years.
Speaker 4: I'm gonna get my rental income hopefully that covers some
Speaker 4: of that interest only portion, and in ten years we're
Speaker 4: going to look at my property and hope that it
Speaker 4: has increased in value.
Speaker 1: And let's say you.
Speaker 4: Purchased an apartment in Richmond for four hundred thousand dollars
Speaker 4: ten years ago, maybe that is worth six fifty seven
Speaker 4: fifty now, very very likely. So you go, actually, you
Speaker 4: know what I'm going to do going to sell that property.
Speaker 4: I'm going to pay back my loan, and it's entirety
Speaker 4: of that four hundred and fifty thousand dollars that I
Speaker 4: borrowed from the bank.
Speaker 1: The rest is profit.
Speaker 4: Obviously, you have to pay tax on that because it's
Speaker 4: investment income.
Speaker 1: But a lot of people do it this way.
Speaker 4: Very uncoman to do that for your family home, because
Speaker 4: usually the intention is to get your family home, pay
Speaker 4: off your family home, live in it without having any
Speaker 4: mortgage or rent or anything overhead. Right, So the priorities
Speaker 4: are usually different, which is why often you don't see
Speaker 4: that many people putting their home loan on interest only.
Speaker 4: If you are choosing that, it usually is for a
Speaker 4: short period of time, beck And usually that short period
Speaker 4: of time is because you know, interest rates have gone
Speaker 4: up to seven point two percent and money and cash
Speaker 4: is really tight, So you go, you know what, I
Speaker 4: can take a bit of the pressure off right now,
Speaker 4: beck by going to interest only for a short period
Speaker 4: of time while I rEFInd my feet, or interest rates
Speaker 4: come down a little bit and take a bit of
Speaker 4: pressure off because this is all.
Speaker 1: Too much, right?
Speaker 4: Does that make sense as why you would and wouldn't
Speaker 4: do that? For investment loans, you actually need a larger
Speaker 4: deposit than you do for owner occupyer loans. Most banks
Speaker 4: for investment, although you can totally go down the LMI space,
Speaker 4: they want you to have a minimum loan to value
Speaker 4: ratio of ninety percent including l am I, although exceptions
Speaker 4: for some banks will you know, go slightly higher here,
Speaker 4: whereas most banks actually allow ninety five percent including LMI
Speaker 4: for owner occupy, which is kind of cool, right, So
Speaker 4: it means that banks, essentially, you know, this is not
Speaker 4: including any government schemes. Essentially, there are some banks who
Speaker 4: will let you purchase owner occupied properties for a five
Speaker 4: percent deposit back, or as for investment property, that.
Speaker 1: Is not the case.
Speaker 4: Okay, I understand, because there's a lot more risk in
Speaker 4: investment property than there is a property that you're going to.
Speaker 1: Live in, yes yourself, Yes, I see. Okay, this is.
Speaker 4: Probably a really really good time to plug the guys
Speaker 4: at Zela Money, the guys, the gals, the team at
Speaker 4: Zela Money to be like, if you're thinking about this
Speaker 4: and this conversation about interest rates and mortgages is overwhelming, yeah,
Speaker 4: go talk to Kate and the team. Honestly, they're good
Speaker 4: eggs doing good things. And if you don't have a
Speaker 4: five in front of your interest rate at the moment,
Speaker 4: if it's higher than that, go see them to get
Speaker 4: it all fixed up. Because often when you have an
Speaker 4: investment loan back, what happens is you're usually more likely
Speaker 4: to be on a variable interest rate, which means it
Speaker 4: might have gone up. And if you haven't checked your
Speaker 4: interest rate recently and just assumed it's the same as
Speaker 4: what it always was, triple check it because it could
Speaker 4: be higher than what you're expecting it to be. I
Speaker 4: don't mean to scare people. I just want to make
Speaker 4: sure everyone's in a good financial position.
Speaker 3: I love that about you, V.
Speaker 1: Thank you trying my best.
Speaker 4: So if you're buying an investment back to the actual episode,
Speaker 4: sure it means that if you're a first home buyer,
Speaker 4: you actually don't get any discounts on stamp duty or
Speaker 4: like the first home buyer benefits that exist, and you
Speaker 4: can't go with any of the first home buyer schemes
Speaker 4: if the purpose isn't owner occupier, even if it is
Speaker 4: your first property. So if you're planning on purchasing your
Speaker 4: very first property and it's all very exciting, make sure
Speaker 4: that you've looked into it and you're not just assuming
Speaker 4: that you get access to the first home super savor
Speaker 4: scheme immediately or you're going to get the first home
Speaker 4: you know grants in your state or territory, because it
Speaker 4: doesn't necessarily mean you'll get it for an investment property.
Speaker 4: In fact, the expectation would be that for you to
Speaker 4: access that, you would live in the property for a
Speaker 4: minimum of six to twelve months before then renting it
Speaker 4: out and making it an investment property.
Speaker 1: Sure makes sense, That does make sense.
Speaker 4: So rates are higher with investment loans than owner OK,
Speaker 4: which is interesting but also worthy of consideration because I
Speaker 4: think you just go into it often just assuming the
Speaker 4: same right or just get a home loan whether I
Speaker 4: live in it or I have it as an investment property,
Speaker 4: And that's not the case, not.
Speaker 1: The case, not the case.
Speaker 3: Interesting pun intended. Yeah, that's a good pun, pretty good,
Speaker 3: so V what are some things to think about as
Speaker 3: a landlord.
Speaker 4: I feel like there are a lot of things the
Speaker 4: world has enough not so nice human beings.
Speaker 1: So be a nice human, I think is at the
Speaker 1: crux of it.
Speaker 4: And remember that your tenants are human beings as well,
Speaker 4: and they deserve to be treated as human beings. You
Speaker 4: have taken on this responsibility of becoming a landlord completely consensually.
Speaker 4: Beck Like you did accidentally become a landlord and you
Speaker 4: hated the idea of it. You decided that investment property
Speaker 4: was for you, and one of the ways you were
Speaker 4: going to make money from investment property was to tenant
Speaker 4: the property.
Speaker 1: And that makes sense.
Speaker 4: But that doesn't mean that you get to treat those
Speaker 4: people like trash. It's absolutely not the case. And I
Speaker 4: think that it doesn't take that many brain cells to
Speaker 4: just be a kind human like. It's actually, from my perspective,
Speaker 4: your responsibility to make sure that if you're going to
Speaker 4: have tenants, you've thought about your emergency fund. You've thought
Speaker 4: about all of the things that could potentially go wrong,
Speaker 4: and maybe you have a separate property emergency fund so
Speaker 4: that if something goes wrong, because inevitably improperty it does,
Speaker 4: and unlike it going wrong in your own house, it
Speaker 4: usually has to be fixed immediately. Water goes off, beack,
Speaker 4: like the hot water system completely breaks.
Speaker 1: I would look about it at my house for a
Speaker 1: minimum of a week. I'd probably go and you're like,
Speaker 1: share it.
Speaker 4: At the gym, and just like put off purchasing a
Speaker 4: new hot water system for as long as possible. You know, yea,
Speaker 4: if it breaks in your tenant's house, it's classified as
Speaker 4: an emergency. You have to fix that immediately. Like that's
Speaker 4: not an if a butt a. Why There's so many
Speaker 4: different things that could go wrong that are your responsibility,
Speaker 4: Like and I just don't think it takes that many
Speaker 4: additional steps to make your tenants feel warm and welcome,
Speaker 4: like small things. Could you just leave a little nice note,
Speaker 4: maybe like a box of roses and be like, hey, Beck,
Speaker 4: so excited that you're moving into our property. We love
Speaker 4: this property. We hope you love it as much as
Speaker 4: we do. You know, if you've got any issues, contact
Speaker 4: your property manager.
Speaker 1: They're amazing. We've picked them because they are kind. Or
Speaker 1: you could say, here's my number.
Speaker 4: If anything goes wrong, you're more than welcome to contact me.
Speaker 4: I remember moving into a rental and being mind blown.
Speaker 4: When someone did that to me, I was like, oh
Speaker 4: my god, that's wild.
Speaker 1: They care.
Speaker 4: But there's so many different things that you could do.
Speaker 4: One just don't be a trash human.
Speaker 3: Sure.
Speaker 4: The next is really understanding, like why are you trying
Speaker 4: to increase rent? Is this an ethical decision?
Speaker 2: Right?
Speaker 4: I think there is a big conversation to be had,
Speaker 4: especially right now around all right, Beck, so you've got
Speaker 4: an investment property. Interest rates they're cooked. They've gone up
Speaker 4: so much. You didn't see them going up this much.
Speaker 4: Totally get it, Totally understand that you're under some financial pressure.
Speaker 4: Is that financial pressure your tenant's responsibility.
Speaker 3: That's a tough one.
Speaker 4: You're the one that chose to have an investment property.
Speaker 4: Your tenant chose to rent a property for less, pretend
Speaker 4: five hundred dollars a week. At that amount, they thought, oh,
Speaker 4: we'll go up, you know a little bit each year
Speaker 4: in line with inflation. In Line with inflation is usually
Speaker 4: between two and three percent. I think most of us
Speaker 4: calculate for that. Sure, but your landlord, their mortgage repayments
Speaker 4: have gone up, and it couldn't possibly come out of
Speaker 4: their back pocket to have to cough up some money
Speaker 4: for the investment property that they own because interest rates
Speaker 4: are doing what interest rates do and fluctuate. I find
Speaker 4: it incredibly rich and I'm going to get people jumping
Speaker 4: down my throat about this. You want bring it on,
Speaker 4: that's fine, sure, But if you are astronomically increasing your
Speaker 4: tenants rent because you cannot afford the mortgage, the actual
Speaker 4: question here is when are you selling your property right?
Speaker 1: Because what you've just.
Speaker 4: Told me is you cannot provide ethical housing, fair housing.
Speaker 4: You can't afford to do that, meaning you can't afford
Speaker 4: the property that you own right now, right So what
Speaker 4: are you going to do? Is it coming out of
Speaker 4: your back pocket? And the end of the day, that
Speaker 4: money should be coming out of my personal savings, It
Speaker 4: should be coming out of my offset. It should be
Speaker 4: coming out of that because I'm funding this investment property
Speaker 4: that ultimately should be an investment. It's not your tenants
Speaker 4: responsibility to pay your astronomical mortgage or payments because you're
Speaker 4: the one that committed to that. They didn't commit to that. True,
Speaker 4: they committed to paying the average rent. Maybe they're paying
Speaker 4: a bit more because you've got a real fancy house. Yeah,
Speaker 4: they committed to that area because it was making sense
Speaker 4: to them. And you know what, there are a lot
Speaker 4: of people in this world and in our community who
Speaker 4: choose to rent because they like consistency. Like they might
Speaker 4: not like the idea of variable interest rates. They might
Speaker 4: like the idea of the flexibility of being able to
Speaker 4: move whenever they want, only having a one year lease.
Speaker 4: They might like the fact that they can guarantee that
Speaker 4: their property costs are going to be five hundred dollars
Speaker 4: a week and if the hot water system breaks, it's
Speaker 4: not their responsibility.
Speaker 1: And that's fair.
Speaker 4: Yeah, because that's the deal that you and I have
Speaker 4: when we sit down and I go, Beck, I'm a
Speaker 4: property owner, I'm going to lease it out, and you go,
Speaker 4: no worries. Here's this lease agreement outlining the terms and
Speaker 4: conditions of this lease. This is what I'll bring to
Speaker 4: the table, the cash holder. Ah, And this is what
Speaker 4: you'll bring to the table, yeap. It really grinds my
Speaker 4: gears when people say, oh, Victoria have no other option
Speaker 4: but to put up the rent. Have you seen the
Speaker 4: mortgage repayments? You can't afford your mortgage of payments? Okay, Well, one,
Speaker 4: you should factored this in a good mortgage broker would
Speaker 4: have sat you down and made sure that any fair
Speaker 4: variability was accounted for, that you could have paid more
Speaker 4: that you know there was a plan in place. Any
Speaker 4: responsible and ethical landlord would have their own property emergency fund.
Speaker 4: Any responsible and ethical landlord would know when.
Speaker 1: To pull out.
Speaker 3: That is a micdrop mode.
Speaker 4: Like if you cannot afford to keep the investment property
Speaker 4: that you currently have, that's actually okay. That's the risk
Speaker 4: you took on when you got the investment property, is
Speaker 4: that your circumstances might change and this investment asset might
Speaker 4: not work for you forever.
Speaker 1: Sure, you don't get to keep it just because you
Speaker 1: think that you deserve it. It makes me very, very angry.
Speaker 4: I think the other conversation is really around you know,
Speaker 4: and obviously there's so many legalities around that in some
Speaker 4: states and territories you can only put rent type X amount,
Speaker 4: or you can only do xyz every twelve months or
Speaker 4: everywhere it's different. But I really think it comes down
Speaker 4: from my personal opinion, which you know, this podcast should
Speaker 4: be really about putting all the information on the table
Speaker 4: then being like beg you make your own decision, but
Speaker 4: like my opinion right now is don't be a dear.
Speaker 4: And I think that's really relevant. Sure, And I think
Speaker 4: that if it comes down to it and you're listening
Speaker 4: to this and you're like, oh, Victoria's off her rocker,
Speaker 4: like she doesn't understand it. Oh no, Bay, by my
Speaker 4: own property, I understand that I have an investment property. Yeah,
Speaker 4: And if I can't afford that one day and it
Speaker 4: was tenanted, I know deeply that that's not my tenants
Speaker 4: responsibilities to carry the weight of my investment.
Speaker 2: It's not.
Speaker 4: I love that at the end of the day, you
Speaker 4: need to know when an investment is serving you, and
Speaker 4: when an investment is not serving you, and when to
Speaker 4: dispose of one. I love as you took that on
Speaker 4: yourself as a perpetual tenant.
Speaker 3: I thank you.
Speaker 1: It just makes sense.
Speaker 4: It's not about thanking me, it's about going Actually now
Speaker 4: we talk about it, because I think that there's just
Speaker 4: so much conversation coming from tenants and then being like, Oh,
Speaker 4: they're just annoyed because they're tenants, right. No, no, No,
Speaker 4: I'm a property owner. I now own an investment property
Speaker 4: of my own, and I cannot imagine putting that responsibility
Speaker 4: on somebody else. Love that sis it makes me so mad. Also,
Speaker 4: when you have to put up rent, I think clear
Speaker 4: and honest communication about why when we're and how Like
Speaker 4: I know a couple of my friends who own investment
Speaker 4: properties have had to put up their rent because during
Speaker 4: COVID they offered their properties for really really discounted rent.
Speaker 4: Sure and now it needs to be brought back to
Speaker 4: market value. But it was articulated at that point in time,
Speaker 4: like oy like it significantly discounted COVID rarah, like it
Speaker 4: might have been an apartment in the city or whatever.
Speaker 4: I think that conversation is really valid. But it's about clear,
Speaker 4: consistent communication and putting timelines in place and going hey, Beck,
Speaker 4: like so unfortunate, but like maybe in six months we're
Speaker 4: going to have to put the rent to X, like
Speaker 4: can we see that? Also negotiate with your tenants because
Speaker 4: it doesn't mean that just because you think it's only
Speaker 4: twenty bucks a week more, what's that matter to a
Speaker 4: lot of people. Twenty bucks a week is eating or
Speaker 4: not eating. Yes, So if you could just stop pretending
Speaker 4: that small amounts of money are flippant because it's not
Speaker 4: an issue for you, that would be great. So it
Speaker 4: just it really frustrates me. Obviously, I will always advocate
Speaker 4: for prioritizing lower income tenants, in fact they are probably
Speaker 4: good long term tenants, and actually having a conversation around
Speaker 4: well what does that mean?
Speaker 1: How does that work?
Speaker 4: Because sure, nowadays landlords have all the applications put in
Speaker 4: front of them and they see, oh, no couples a
Speaker 4: lawyer and a doctor. Well let's put them in my
Speaker 4: house because they earn a lot of money. Who cares
Speaker 4: are they paying the rent?
Speaker 2: Like?
Speaker 1: Can you pay the rent or not?
Speaker 4: It's very fair to check if service ability exists, Yes,
Speaker 4: but why are we prioritizing the lawyer and the doctor
Speaker 4: is better tenants than somebody who's on a lower income
Speaker 4: who might arguably be more respectful of your property.
Speaker 2: Right?
Speaker 4: The other thing, can we start offering longer than twelve
Speaker 4: month leases?
Speaker 1: That would be pretty cool.
Speaker 4: Financial still, ability for people is really important, and I
Speaker 4: know that when I was a renter, I would have
Speaker 4: loved the opportunity of signing a longer lease because I
Speaker 4: was always so scared that if I signed a one
Speaker 4: year lease, oh my gosh, what's rent going to go
Speaker 4: up by next year? Am I going to have to
Speaker 4: move around? What does that actually look like and it
Speaker 4: also gives people that longer term financial stability. It's like,
Speaker 4: I know that in Australia they've just started offering not everywhere,
Speaker 4: but I know a few people who have offered ten
Speaker 4: year leases. Oh that is cool, And I just think
Speaker 4: it just makes sense, like home would then feel more
Speaker 4: like your home. Yeah, and you've got a long term
Speaker 4: secure tenant. And I mean, you're going to have all
Speaker 4: the same issues that derise the hot water system, the
Speaker 4: xyzed But I think it's important to put other people's
Speaker 4: financial security at the forefront of decisions that you're making,
Speaker 4: because you're in a privileged position to be able to
Speaker 4: afford property to begin with. Anyway, Beck, I think that
Speaker 4: the crux of this is if you're a landlord, know
Speaker 4: when to tap out. I get it, Like saving for
Speaker 4: a property is so hard, Beck, Like getting your then
Speaker 4: finally getting loan, it's like you've achieved a life goal, right,
Speaker 4: like it's a status symbol.
Speaker 1: And then going backwards.
Speaker 3: I get that it could feel terrible.
Speaker 1: And you're like, well, I don't want to give that up,
Speaker 1: like that sucks.
Speaker 4: But if you're not in a financial position to be
Speaker 4: a fair, equitable and reasonable landlord. Yeah, maybe you're out,
Speaker 4: like you have to make the decision that is not
Speaker 4: just right for you, but it is right for the
Speaker 4: asset class that you've chosen.
Speaker 1: And that's an option.
Speaker 4: It's not like you bought shares and they're just sitting
Speaker 4: over there and you can't make your monthly contributions to
Speaker 4: them and they just sit there and they continue to
Speaker 4: grow and do their own thing. If that's the case,
Speaker 4: maybe that's a better investment opportunity for you. So at
Speaker 4: the end of the day, I think a healthy city
Speaker 4: needs a mix of affordable rentals of different sizes. I
Speaker 4: think that some people will always prefer renting over owning
Speaker 4: for various points in their life, and for that to work,
Speaker 4: they need access to affordable, diverse, and safe rental housing.
Speaker 4: It's too hard at the moment, and I think that
Speaker 4: people are too entitled at the moment.
Speaker 1: You see it.
Speaker 4: I'm sorry real estate agents and property managers and everybody
Speaker 4: else who thinks it's like, oh, but the landlord. No, no, no,
Speaker 4: the landlord has just as much responsibility I.
Speaker 1: Ask in this as anybody else.
Speaker 3: Yes, you can probably tell them, really sitting on the
Speaker 3: fence here, just to be safe because I don't know
Speaker 3: enough about the market. But I really like everything you're saying,
Speaker 3: and I tend to agree. But I think that's a
Speaker 3: fantastic place.
Speaker 4: To leave it.
Speaker 1: I think it is a fantastic place to leave it.
Speaker 1: Let's get some lunch.
Speaker 4: Let's do it fish bowl ten out of ten, ten
Speaker 4: out of ten, and we will see you guys on Friday.
Speaker 4: By the advice shared on She's on the Money is
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