Rents have been going up for a few years now, just wonder how everyone's going.
What Has Everybody Done since The Start of The Rental Crisis?
niknah on 06/06/2024 - 11:08
Poll Options
- 143Paying the extra rent
- 11Moved to a shared home
- 14Moved out to a cheaper suburb
- 8Moved out to another city
- 97Purchased a home
- 7Homeless
- 3Couchsurfing
- 20Back with parents
- 267No change / home owner / still with parents / etc.
Comments
Finished watching youtube
Chuck Norris has watched it twice
Ozb #1 pick would be buying an investment property
And then crap on about landlords.
Yep.
OzB rental narrative:
All landlords: evil, money grabbing robber barons
All tenants: Saintly, oppressed orphansNaaah, that's Reddit's narrative.
The typical OzBargainer isn't renting.
Do you usually read the OzB forums? Half the comments on the recent post about a blocked drain in a rental were from landlords.
And to your description of attitudes. They all seemed to consider themselves magnanimous saints while opining that they wouldn’t charge a tenant for their first blocked drain. At least here in Vic, that is their legal obligation in this business transaction.
@CommuterPolluter: Your legal obligation as a landlord is to pay for a maintenance or structural issue. The tenant's legal obligation is to pay for an issue caused by tenant misuse. Whether a blocked drain is the former or the latter depends on the facts of each case. Neither side has a blanket legal obligation.
@justworld: Exactly. Unless you have a TikTok of them pouring a bucket of lard down the drain it’s the landlord’s responsibility.
Put the rent up on my investment property.
This - has been a nice boost of disposable cash.
Rent went up but so did the interest rate, so no great difference really.
That assumes you have a mortgage - not all of us with IPs do. Also, any interest rate on an investment loan gets reduced by 47% due to being deductible.
@justworld: Isn't one of the point of owning IP is to get that negative gearing?
Though owning an (or a few) IP outright is awesome.@aboogee: You're only negative gearing if you make a loss surely? (ignoring the unrealised gain in property value)
@Assburg: What have I missed then? I've never dug into IPs as the whole concept (or at least how it's treated in Australia) doesn't sit right with me.
@mandelbrot: Making money at the expense of others' basic needs, yes. Sure, it's more complex than that, but that's what it boils down to.
@mandelbrot: You're assuming private rentals are the only option. That's increasingly the case, but it wasn't always so. Even if there are only private rentals, the way it's done in Australia is fundamentally exploitative and places renters at a severe disadvantage. Other countries that have private rentals give tenants much greater rights, e.g. they can live their entire life in a property without the threat of being evicted on the whim of the owner.
Making money at the expense of others' basic needs
lol, but you are providing others' basic needs
@trapper: So? The way in which it is done alters the market such that the balance of risk/reward is massively in the landlord's favour. If landlords were building houses for rent then that would be better, but as it is they're almost exclusively removing existing houses from the market.
removing existing houses from the market.
And where are they putting all these 'removed' houses? Oh… adding them to the rental market, reducing rental prices.
@trapper: Over the last 30 years rent has gone up with CPI, up until recently where the housing shortage has made it possible for rapid increases in rents..
It is quite obvious that investors have not lowered the price of rent. What they have done is push up the price of real estate to the point where millions of people who would have bought their own home can not afford to.
The idea that we need to subsidise investors to help tenants is not supported by any evidence
@banana365: The costs you incur paying interest and maintaining the property can be used as tax deductions against your taxable income (including income made working your 9-5), which in effect means most people are probably paying more on interest to live in their home than they are to rent one out.
@banana365: The point with negative gearing, no different from margin loans in shares, is to increase financial leverage.
You are losing money, yes, because of interest that you pay.
But you get to claim tax deduction, which reduces your losses
Particularly useful when you're at the highest tax bracket because your net loss is effectively reduced by 45%.
Also if you have a view on the market (any market).If you have no loans on your IP, good on you but probably not "efficient"
It all depends on your financial circumstances really… and this is not a financial advice.Isn't one of the point of owning IP is to get that negative gearing?
The entire point of negative gearing is to turn a taxable gain into an unrealised gain.
@trapper: ???
Negative gearing is using a (net) ongoing expense on an asset to offset your other current year taxable income.
@Crow K: You're correct, negative gearing offsets current taxable income with expenses.
However, the purpose behind negative gearing is to turn taxable income into an unrealised gain. Investors hope to benefit from the asset's long-term value increase, which can lead to significant gains that are taxed at a lower rate (as capital gains) or can be deferred until the asset is sold.
@trapper: This is where you're losing me. Regardless of whether the property is being negatively geared or not, as it (hopefully) appreciates in value, it's becoming an unrealised gain by itself. There's no "turn it into an unrealised gain via my actions" step.
Negative gearing is a parallel sweetener along the way that allows some of the capital's excessive expenses (e.g. loan interest) to be converted to revenue losses.
At no stage is taxable income converted back the other way?
@Crow K: The property will still (hopefully) appreciate in value of course, it's just very suboptimal not to leverage the mortgage.
For the same outlay as one IP fully paid off, you could have five IP's all with 80% mortgages.
That's more than a 'sweetener', that's 5x the capital gain.
@trapper: None of that relates to what I was asking, though.
Are we are agreed at no stage a taxable gain/income is 'converted to unrealised gains', then?
@trapper: It will be faster in future to fess up with something like "I am using terms incorrectly, I will leave it to the readers to decide how much I know what I am talking about".
Love the little "lol" at the end, though. Just having fun, palling around, no need to keep track of whether I was wrong or not, we're changing the subject.
@trapper: I am. I've had my say, and now they get to have a little read and make their minds up.
In case my position is in doubt, I'm not going to be hitting you up for any specialist tax advice any time soon.
@trapper: The real point is you can pump up depreciation without anyone checking and also you can deduct things (like home repairs, improvement and maintenance) that otherwise would not be deductible.
@trapper: Ideally you want it cashflow positive but with enough deductions (depreciation etc) to make it negative while not incurring suspicion of the ATO by inflating deductions beyond normal parameters
May be he doesnt have mortgage on it ir interest only in which case it is a boost of income 🤷♂️
My agent noted that I hadn't increased rent in ~ 10 years and asked if I was happy to leave it a while longer since my tenant had an incurable illness and was in her last days. (That was a year or 2 ago.)
I said sure.The rent more than doubled just a few weeks ago.
I feel really sad now.Sad about what?
Anyway, rent setting is just a market exercise. People taking the piss if they think it is anything more or less than that.
@justworld: Clearly my long term tenant finally gave up the ghost.
Well maybe today you'll learn something. I'll already gave you one example, and there is at least one more in other comments I read here.
Personally, I feel that I've been adequately rewarded with capital gains, so some of my tenants haven't had a rent increase in many years.
There's more to life than grabbing every dollar, and there are people outt here with a much better attitude than yourself. You can even change your own attitude instead of being cynical.@SlickMick: I didn't catch the bit where your tenant died. Oops. Sad story.
I don't believe in the concept of capital gains as I never sell properties. I buy them, pay them off and use them as big term deposits. So no capital gains for me. Just passive income so I can retire early.
I agree there's more to life than grabbing every dollar, but I also want a nice passive income so I can fatfire and not have to worry about money. Nothing cynical about that.
@justworld: haha not believing in it doesn't make it go away. It will just keep accumulating and someone eventually has to pay it. (I said something similar to a financial planner and it sounded so selfish saying it out loud.)
When you say like term deposits, do you mean the income is like interest? Or selling them is like getting your principal back with interest at end of term?
@SlickMick: No one has to pay capital gains tax. It can be held forever and passed on to future generations. And in any event if someone has to pay it, it comes at a 50% discount, so it's not that bad.
I mean that the income is like interest. They are term deposits that you can pass on (tax free) to the next generation. You treat them like a big savings account. You diversify geographically or put into trust so that the land tax bill doesn't become too hefty.
No one has to pay capital gains tax. It can be held forever and passed on to future generations
The home ownership rate of 30–34 year old’s was 64% in 1971, decreasing 14 percentage points to 50% in 2021. If people who own property don't join with the rest of the population and seek reform, and home ownership keeps falling, it would be very likely that a more extreme political party will take over and install an inherentance tax, rent controls, and the maximum amount in your superannuation account will be capped - just to name a few policies possible that don't require outright communism.
It's in everyone's interest to fix the broken market, except the banks. Assuming that Australians will accept that a huge segment of the population will make more in capital gains each year than they earn working a job is not a good long term strategy, especially in a world where 90% of the population is connected to social media and easily agitated by clickbait
All them Albo and Gerry lovers neg you!
You didn't get flooded with tenants because your property or price was anything special. There's more demand than supply and people are f'ing themselves over just to keep a roof over their and their families heads.
Yes. It's called the free market. Get used to it.
My agent was therefore wrong when she suggested a rent of $580 since the place easily rented out for $600.
Now looking forward to having another tussle with my agent when she suggests I put it up to $630 rather than $660.
As I said to her last time - let's put it to market and see what we get.
@Breno785au: So what was the point of your comment then? No, I don't think my IP is anything special. Does anyone? There are millions of rental properties. It's good enough to rent out and take advantage of supply and demand and that's all I ever want from my properties. Buy them, separate them geographically and by entity so that you don't pay too much land tax, get enough rental income and retire. The properties don't have to be special at all. Just nice starter homes for families to rent.
Salaries haven't been going up as fast as rent in most places.
I never said they had or hadn't.
Since you didn't qualify that the salaried consumer's increase in income was less than the increased price for goods and services it was obvious you intended to imply there was some form of % equality between payer and payee
only if you're a CFMEU worker in Victoria and Queensland
Strong endorsement of the union.
@mskeggs: I drive past a site everyday theres usually 5 or 6 standing there watching one guy working in machinery. Get paid 3 times what a council worker gets but dont have the courtesy of at least leaning on a shovel.
@mskeggs: It's the story of Humanity. The battle between weak oppressed Lords and overseers and their lazy but organised self-entitled serfs.
@mskeggs: Would it be better for society if billionaire developers made even more money?
Let's say you don't like that dirty tradies drive 100k raptors everywhere. Do you think you will be better off living in a society where those people were more desperate for money?
@2esc: What one person receives without working for another person must work for without receiving.
The poor person must be the future generation if no ones paying for it today.
Never forget, it's stated Liberal Party policy that they 'manage the economy to keep wages low' - from previous Finance Minister Mattias Corrman.
Works out well if you work in an industry with strong wage growth regardless of economic conditions. You'd rather have weak economic growth in that case.
standard of living goes down
fastfood becoming more expensive - indirectly encourages healthier homecook meals :D
That's a very small range of six weeks.
How about average retail price of petrol per litre per year?
2019-20 135.2
2020-21 129.1
2021-22 172.8
2022-23 183.7Or diesel?
2019-20 141.1
2020-21 125.4
2021-22 174.5
2022-23 208.4example is NSW, but all states and territories have gone up.
True, the price hasn't gone crazy since COVID, 2021-2023. I still haven't paid more than $1.70 per L fuel (91) yet! Where rental price went crazy since covid.
or LPG
2019-20 0.65
2020-21 0.62
2021-22 0.75
2022-23 0.89i do love my car.
haven't raised the rent since we bought the house in 2008 (tenant is my mum)
.Boomers sponging off the younger generation again!
"Boomers sponging off the younger generation again!"
That is unless you're a Gen X or a Millenial and your parents, and/or grandparents die and leave you all their so-called billions of lovely money and assets then the complaining stops. For them anyway.
So it's a new norm for people to live with their parents rent free even in their 30s but mum has to pay rent. 👏 👏
If he hasn't raised the rent since 2008 he's probably only covering costs rather than profiting off her, someone has to pay the local council tax and maintenance.
I was self sufficient as a teenager. Mum and her partner were already renting and wanted to move closer to us with our little ones. They did not want to buy a house. It's a win win as they are paying far less than market rate for many years now and we have a nest egg
.
my rent has gone up 231.5%
…in thirty years.
Profitted
Living in a tent isn't a poll option? C'mon man!
https://www.9news.com.au/national/housing-crisis-queensland-…
Steven and his comrade A have geoblocked you!
stopped being poor and bought a house
What has everybody done since the start of the Rental Crisis?
Cut spending but not because I'm financially stressed.
The problem is without a permanent abode and a real desire to move interstate, I loathe new physical purchases and really find it hard to invest in anything for (what I imagine) is a couple of months (that is now four years).
Where the item is small - it's fine: got a pretty sweet laptop and mobile. But I can't work out where to spend this cash and I can't yet afford a house at the price I want.
Realistically, I can't see how more subscriptions will make me any happier - I just don't have the time for them. Physical purchases definitely would - my couch is held together by duct tape and the washer only works on two settings.
I have also thought of just chucking it all in and travelling for a very long time. Realistically there'd be no financial issue doing this for a year or even longer. I hope one day I'm bold enough to give up on Australia's real estate nightmare and do this.
Darwin is also an option - though it's bloody hard getting to the home opens there. I hated Darwin when I was last there as an eight-year old - so I'm not sure what I'd think of it now.
Well your username certainly doesn't check out!
I finished a jig saw puzzle.