What an unusual time we are living. The Covid-19 pandemic means our lives are changing daily and sometimes, hourly. There’s no getting away from the fact that the next few years are going to be tough for everyone.
We are still open for business. Although historically property tends to perform well during periods of sharemarket volatility, It’s anybody’s guess how property markets will respond to the pandemics affects over the long haul. However, in the short term, I think they will slow dramatically for at least the next few months. We are definitely receiving a greater number of Off-Market listing emails from agents and currently, access to on and off-market properties is now only via inspection by appointment and virtual inspections. (This could change at any time though)
For sales agents, this will help weed out tyre kickers and nosy neighbours, the inspections will have to be short, especially on weekends (maybe 5 minutes each), and they will implement new technology to market the properties and themselves online.
I still feel very strongly that a physical inspection must be undertaken before purchasing, as agents will naturally want to make slickly edited videos to present the properties in the best possible light (remember they do work for the vendor). I doubt they will be showing dry rot, rusty water heaters, shoddy renovations, or termite damage in the videos.
While purchasing a property right now may be pretty low in your priorities at the moment, here are some things I’d suggest everyone should immediately focus on to ensure they are in the best position to get through the next few months
Review all the government stimulus options available to you, your family, and if applicable, your business. If you have an accountant, give them a call for advice. If you do qualify for any benefits, don’t let pride get in your way, apply straight away.
Start a budget and see which items you can cut back on in the short term. Use this budget to help get things under control initially, and then to help you build wealth over the long run.
If you currently have mortgages on any properties, then review the deferment policies of your lender and if you are still in a position to refinance, speak with your mortgage broker about the current loans available, as lenders are also chasing business. They are offering very competitive rates as well as cashback in some situations.
Review your current loans and credit cards and see whether you can consolidate loans to try and reduce your loan payments.
Review all your insurance policies to make sure they are up to date and that yourself and your assets are protected.
If you own investment properties and don’t have a depreciation report, at least review whether it is worthwhile to obtain one. Washington Brown Depreciation has a calculator to get an estimate of deductions available. I believe they are offering unique payment plans now as well.
Government policy is very fluid at the moment, so make sure you keep up to date with the latest changes. At the time of writing, it’s been announced there will be a six-month moratorium on tenant evictions, but there is no detail released yet.
If you need to discuss any of the above or would like referrals to accountants, mortgage brokers, lawyers etc. or you would like to talk about the market in general, feel free to contact me anytime.
The sun will rise tomorrow, we know the economy will recover we just don’t know when. If you are thinking of investing in the near term, now is a great time to start your planning. Do your research, create a budget and investment strategy, build a reliable team around you, and get your finances approved and if at all possible keep it approved until your ready to enter the market at a time of recovery.
We are all in this together so stay safe, and when possible stay at home.
Craig Hogg Managing Director firstname.lastname@example.org 0404 857 580