A lot has happened to the economy since COVID struck, and reading the economic tea leaves has become more difficult.
Many of the gains for many Australians in 2020 and 2021 were artificial and didn’t last.
The COVID Supplement temporarily doubled JobSeeker, for example.
JobKeeper paid workers what their employers could not.
As these measures have been unwound, the gains have been unwound, making it more difficult than usual to separate the economic signal from the noise.
But in a study just published in the ANU Centre for Social Policy Research journal POLIS@ANU, we have made an attempt.
We wanted to find out which kinds of households are expected to be financially better off and which are worse off five years on from the outbreak of COVID, comparing 2024 with 2019.
We’ve adjusted incomes for living costs
We have examined incomes after adjusting for changes in living costs.
This means that if a household’s after-tax income increased by 20% but its cost of living also increased by 20%, we have regarded its financial living standard as unchanged.
The tool we used was the ANU PolicyMod model of the Australian tax and transfer system, Australian Bureau of Statistics data on employment, demographics, prices and wages, and government data on tax and payments.
We have also taken account of the income tax cuts and changes to payments that begin next month.
Our estimates for December 2024 are projections based on the assumptions in the budget about incomes and prices.
We find overall living standards increased from 2019 to 2021 but then fell sharply in 2022 with a further small fall in 2023.
Overall living standards were 0.6% lower in December 2023 than in December 2019.
This year they are expected to climb to be 1.3% higher than December 2019.
But it’s an overall picture that glosses over the full story.
Gains for high earners, low earners
The only groups whose living standards grew significantly over the period were households on the very lowest and the very highest incomes.
We divided households into five “quintiles”.
The lowest-income fifth we called Quintile 1.
The highest-income fifth we called Quintile 5.
The Quintile 1 living standard grew 3.5%.
The Quintile 5 living standard grew 2.7%.
In contrast, the living standard of the second-lowest quintile barely grew, and the living standards of the middle and upper-middle quintiles actually fell.
The living standards of middle and upper-middle-income Australians were lower in early 2024 than they had been in 2019.
Low-income households did relatively well partly because their payments were indexed to inflation.
High-income households did well partly because they had investments that did well.
Where middle earners did badly, it was in large measure because they had mortgages.
Where they did well, seems to have been because they were outright homeowners and had other sources of investment income.
Losses for the mortgaged middle
The living standards of mortgaged households fell 5.6% between 2019 and December 2024.
In contrast, the living standards of renters climbed 2.9%, while the living standards of outright owners climbed 8.5%.
On sources of income, the living standards of households whose main source of income was “other” (including investments) grew an astounding 15.8%.
In contrast, the living standards of households that relied on wages and the standards of those that relied on government benefits changed little.
The living standards of households headed by employers fell by almost 10%.
Possibly for related reasons, older Australians have done much better than working-aged Australians, and the youngest did better than the middle-aged.
We also tried dividing households by “financial well-being”, a measure made up of income, wealth, housing tenure, age, disability and family type based on their statistical associations with the Bureau of Statistics measure of “financial stress”.
The bureau’s measure includes the inability to raise emergency funds within a week and to pay bills on time.
Again, we divided households into quintiles.
We called the fifth with the least wellbeing Quintile 1; and the fifth with the highest wellbeing Quintile 5.
The most well-off are better off
The households with the highest well-being did the best, finding themselves 6.2% better off by 2024.
Those who did the worst were those with the second-highest and middle well-being, who found themselves about 3% worse off.
Those with the least well-being were 2.8% better off.
Overall, we did not find that household living standards have dropped remarkably since the onset of COVID-19.
But we can understand why some Australians, particularly middle-income Australians with mortgages and middle-aged Australians, feel they have.
They did badly in 2022 and 2023 as mortgages rose.
Less advantaged and more advantaged Australians did better.
The NSW Government is planning to increase property owners’ insurance costs by shifting the cost of the Emergency Service Levy (ESL) onto them, and increasing surcharges for foreign purchasers, raising the surcharge land tax, and freezing the land tax threshold.
The Government’s solution to the state’s economic woes is to transfer the increased insurance costs for emergency services to property owners, which will reduce investment in property.
The Real Estate Institute of NSW (REINSW) has uncovered another underhanded plan by the NSW Government to charge property owners more, aiming to offset increasingly “unaffordable” insurance costs.
Buried within the Budget’s explanatory notes is a reference to the NSW Revenue Legislation Amendment Bill 2024.
This bill outlines the NSW Government’s strategy to shift the cost of the Emergency Service Levy (ESL) away from insurance companies and onto property owners instead.
The state’s emergency services are primarily funded by the ESL.
With the growing impacts of climate change and more frequent natural disasters, these funding requirements are rising, making insurance less affordable, according to the Bill.
The Budget Paper states:
“The Government will remove the ESL on insurers and instead spread a replacement levy across a broad base of property owners.”
Among the proposed measures are increasing surcharges for foreign purchasers, raising the surcharge land tax, and freezing the land tax threshold.
REINSW has expressed shock but not surprise at the move to transfer the increased insurance costs for emergency services to property owners, given the Government’s track record.
REINSW CEO Tim McKibbin said:
“This Government’s solution to the state’s economic woes is clearly and unashamedly singular: property owners must be able to afford it, so they can pay for it.
If the Bill passes, property owners and buyers will face higher charges so the Government can reduce insurance costs.
The expectation is that insurance companies, in good faith, will adjust their premiums accordingly.
More tax on property owners means reduced investment in property.
In a housing crisis, this is among the most reckless courses of action.”
About Brett Warren Brett Warren is National Director of Metropole Properties and uses his two decades of property investment experience to advise clients how to grow, protect and pass on their wealth through strategic property advice.
Millennials who delay buying their first home are putting themselves at huge risk of being long-term renters.
But complaining about a lack of affordability isn’t going to get them anywhere; instead, they need to start to turn attitude into action.
The fact is: that the number of first-home buyers is dwindling.
This is a massive concern, when you consider a home is the biggest asset the average Australian has when they retire.
But now, for the first time, we’re facing a generation of lifetime renters.
Millennial renters could easily spend over $1.25 million on rent during their lifetime.
And in the end, they won’t have anything to show for it!
Rent money is empty money.
It’s throwing money into paying off someone else’s mortgage.
The alternative is investing your money into an appreciating asset.
To do this means getting out of the rental hamster wheel and buying your own home.
Now, I can see two key reasons why young people are delaying a home purchase.
Millennials are either struggling to enter the market because they can’t afford it or because they aren’t prioritising the task of ‘owning a home’.
I can understand why our younger crowd is on the fringe.
The market is expensive, and growing more so, particularly in white-collar hubs where the jobs are.
Added to that, there’s also a negative presumption – heightened by media hype – that it’s not possible for young people to get a foothold in the property anymore.
But that’s not always true.
There are several avenues available to our Millennials that make it possible to enter the market.
I also firmly believe that it’s vital for Millennials to prioritise real estate ownership – despite the planning and sacrifice that it takes.
The earlier, the better.
Why? Because delaying only perpetuates the unaffordability cycle.
Prices won’t suddenly drop significantly in the next year or two, making it easier to jump into real estate.
Every year of delay equals lost capital growth, a step lower on the ladder, and thousands of dead-end rent dollars.
In an ideal world, your first home should be your own.
You have to live somewhere for the rest of your life, so the person who should ideally own that property is you – not your landlord.
A home is the biggest asset you’ll own and over time as it increases in value and you pay down the mortgage, you’ll be able to unlock equity that can be used as seed capital to buy further (investment) properties.
Come retirement, you’ll own your own home – worth considerably more than the purchase price and several investment properties that generate enough income to live comfortably.
But if you can’t afford to buy your own home in your desired area, what do you do?
First, get to the bottom of the reason why haven’t bought you.
1. Is it because you’re too picky?
If you haven’t yet bought a home because you’re feeling priced out of the market, it might be time to loosen the ‘dream home’ criteria.
Very few first homebuyers debut in inner-city Sydney.
Once you’re on the property ladder, you can start working towards your ultimate home – but for now, just get on the first rung.
2. Is it because you have grand expectations?
A smaller home, or one further from the city, or a townhouse instead of a family home, could put you in a more affordable price bracket.
Lifestyle ‘wants’ might have to take a backseat for a while.
3. Is it because you can’t afford it?
Yes, there is a major money hurdle involved when saving a deposit, getting loan approval, and paying for a mortgage. But that doesn’t mean it’s impossible.
So your first action is to start saving today, even if you’re not sure when you’ll buy.
For example, if you’re an apprentice earning first-year wages, you might not qualify for a loan – but you can start putting aside $50 a week for a deposit.
Assuming a four-year apprenticeship, you’ll have $10,400 saved by the time you’re entering the workforce as a qualified employee.
I would also strongly advise that you maximise your savings by keeping your money in an account with a high compound interest rate.
Saving – and paying a mortgage responsibly – takes some sacrifice.
People don’t often like to hear the ‘s’ word, but it goes hand in hand with moving forward towards security and independent wealth.
Culling some of the major expenses, like dining out, shopping sprees, holidays, and brand new or second family cars might be a necessary step towards getting on top of your finances. You might even need to make bigger sacrifices such as renting a cheaper place while you save.
What about Rentvesting?
If buying your own home still seems out of reach, consider buying a home for someone else instead.
‘Rentvesting’ has become a buzzword lately.
It’s a brilliant strategy for those who either can’t afford to buy where they want to live.
Essentially, rentvesting is buying an investment property where you can afford it in order to get on the property ladder, while you continue to rent where you want to live.
That way, you can be close to employment or lifestyle factors you enjoy, while someone else pays off the mortgage for you.
Rentvesting is also a strategy that suits those who want to buy a property but need the flexibility to move around for employment.
One of the big differences between buying a rental property and your own home is the tax benefits.
Investment properties boomerang money back to you through depreciation, negative gearing, and other deductible expenses that can really boost your financial standing to lenders.
It could be the extra weight you need to tip the scales.
You might choose an investment property in an affordable bracket; you might choose a home you’d like to live in one day but can’t afford to just yet.
Either way, having a tenant paying down your mortgage while you rent elsewhere means you’re holding a tangible asset that’s progressively growing in value.
Remember:
The earlier you start in the property market, the more time, leverage, and compounding will work for you.
Also, buying a property that’s within your means will make saving for a deposit an easier and more achievable task.
Using equity to springboard into purchasing other properties is also a proven and time-honoured strategy used by many of Australia’s 1.8 million investors to grow wealth.
Millennials aren’t an exception to the rule.
Times have changed, but the method is the same: save, sacrifice, and have a plan that sets you up for a financially secure future.
About Leanne Spring Leanne is a highly experienced Buyers Agent in the Brisbane Real Estate market. Leanne became a passionate lover of property in 2001. Since then, both professionally and personally, she has been involved in all aspects of property including purchasing, negotiating, renovating, and selling.
The value of each position listed in this graphic is based on market prices as of May 23, 2024, and will change over time.
Furthermore, note that Berkshire has received SEC permission to temporarily withhold data on certain positions.
This includes all of its Japanese stocks, which are reported as of June 12, 2023.
It’s (almost) all Apple
The data we used to create this graphic can be found in the following table.
Positions worth less than $5 billion were included in “Other”.
Company
% of Portfolio
Value (As of 05-23-2024)
Apple Inc
39.7
$149.8B
Bank of America
10.7
$40.6B
American Express
9.7
$36.8B
Coca-Cola
6.7
$25.2B
Chevron
5.3
$20.0B
Occidental Petroleum
4.2
$15.7B
Kraft Heinz
3.1
$11.7B
Moody’s
2.7
$10.2B
Mitsubishi Corp
2.1
$7.8B
Chubb
1.9
$7.1B
Mitsui & Co
1.7
$6.4B
Itochu Corporation
1.5
$5.5B
DaVita
1.3
$5.0B
Other
9.4
$35.9B
Total
100
$377.9B
From this, we can see that Berkshire’s largest position is Apple, which makes up almost 40% of the portfolio and is worth nearly $150 billion.
While Warren Buffett once referred to Apple as the best business in the world, his firm actually trimmed its position by 13% in Q1 2024.
Even after that cut, Berkshire still maintains a 5.1% ownership stake in Apple.
Why Japanese Stocks?
While most of Berkshire’s major positions are in American companies, Japanese firms make up a significant chunk.
In 2020, Berkshire took positions in five Japanese trading houses: Itochu, Marubeni, Mitsubishi, Mitsui, and Sumitomo.
Also known as sōgō shōsha, which translates to “general trading company”, these firms are highly diversified across major industries.
According to an article from IMD, Buffett sees an attractive opportunity in Japan due to the country’s low interest rates, among other things.
About Guest Expert Apart from our regular team of experts, we frequently publish commentary from guest contributors who are authorities in their field.
Property Development involves a wide range of activities and processes from purchasing land, building and developing high-rise apartment buildings and everything in between.
In order to be successful, you’ll need to educate yourself on property, the markets, economics, finance, town planning, the construction processes and the marketing of real estate projects.
Sound like a lot of work?
Well, it is.
But with well-educated decision-making, it’s a rewarding venture.
We’ve noticed an emerging trend among budding investors – they want an overview of the property development process.
They’re looking at getting into property development as a way of “manufacturing” capital growth and maximising their investment returns.
After you’ve understood the basics, have a read of our 19-part article series as well as our Team Series underneath.
Educating yourself on the rather complex and lengthy process of property development is a great starting point.
After all, you need to have an idea of your end game and the journey getting there before you can even begin searching for an appropriate property to purchase.
Want to know more?
The 19-Part Development Series
Read our in-depth 19-part Property Development Series and learn more about the property development process.
This series delves into the details of each process including costs to consider, who you should be working with, helpful tips and plenty more.
Pre Purchase Stage
Negotiating Contracts and Purchasing
Town Planning and Development Approval
Working Drawing and Documentation
Pre Construction
Construction
Part 17: Preparing the Site
Completion
The Team Series
Read more about the professionals you should have on your side. The Team Series highlights all the important professionals involved in a development project, their roles, and useful tips for finding the right person for your job.
About Greg Hankinson Greg and his team have successfully built and renovated in excess of 500 homes throughout Melbourne and are showing no signs of slowing down anytime soon. Being a Gold member of the Housing Industry Association and National Kitchen and Bathrooms Association, Greg’s focus is on Continued Professional Development, not only for himself, but his team of industry experts.
We are currently witnessing what could be described as the greatest wealth transfer in modern history. As the baby boomer generation begins to age, a massive amount of wealth is being transferred to the subsequent generations. Over the next decade, this generation, who rode a wave of economic prosperity for decades, is forecast to pass…
When it comes to financial security, traditional advice often centres around paying off your home mortgage as quickly as possible.
The peace of mind that comes with owning your home outright is undeniably appealing.
However, this strategy might not always be the most effective way to grow your wealth.
Instead, using the funds to invest in property can potentially offer greater financial benefits.
Here’s why.
1. Leveraging low interest rates
Even though interest rates in Australia have increased over the last few years, they still remain relatively low compared to historical averages.
Your home mortgage likely has a relatively low-interest rate, especially if you secured it a few years ago.
By choosing to keep your mortgage and instead using your available funds to invest in property, you can leverage this relatively cheap debt to your advantage.
The potential return from a well-chosen property investment, especially if you combine both the capital growth and rental income, would be significantly more than the 5% or 6% you are saving paying down your home mortgage.
2. Opportunity cost of capital
One of the key concepts in investment is the opportunity cost of capital.
When you pay off your mortgage, you’re effectively locking in a guaranteed return equal to your mortgage interest rate – in other words, the 6% or so that you’re not paying on your mortgage.
While this might seem like a safe bet, consider what you might earn if you invested those funds elsewhere.
As I have explained, well-located property investments have historically delivered strong returns over the long term, outpacing the cost of your home mortgage interest.
3. Building wealth through property investment
Investing in additional property can be a powerful way to build wealth.
If you think about it, rather than owning one property, your home, increasing value over time, you will now have two properties taking advantage of leverage and capital growth, and of course, you’ll have your tenants helping subsidise your investment mortgage payments.
One of the big benefits of using your funds to invest in property is that it allows you to take advantage of leverage.
By borrowing to invest, you can amplify your returns – basically, you are controlling a larger asset with a smaller deposit, maximising the return on your funds.
For instance, with a 20% deposit, you control 100% of the property and benefit from 100% of the capital gains, effectively multiplying your investment power.
Remember the bank does not get any share of this tax-free growth.
4. Tax advantages
Investment properties offer tax benefits not available when paying off your home mortgage.
Of course, you don’t invest for tax benefits, but they are the icing on the cake.
However, you can write off many of the costs of owning your investment property including insurance, rates and taxes, maintenance etc.
Further…depreciation deductions on property investments can significantly reduce your taxable income, enhancing your cash flow and overall return on investment.
These tax advantages can make property investment more financially attractive than paying down your mortgage.
5. Maintaining liquidity and flexibility
A paid-off house is a great asset, but it’s not very liquid. Once those funds are used to pay down debt, they’re not easily accessible for other opportunities or emergencies.
Keeping your mortgage and investing your available funds allows you to maintain greater liquidity and flexibility.
While this might not be available if you invest in another property, it could be a reason to invest some of your money in shares or ETFs.
6. Diversification of assets
Diversifying your investments is a key strategy to manage risk and enhance returns.
By investing in property rather than solely focusing on paying off your mortgage, you can diversify your asset base.
And as I mentioned, you may choose to invest some of the funds in other asset classes like shares or ETFs.
This diversification can contribute to a more resilient and robust financial portfolio.
Psychological considerations
While the financial arguments for investing in property rather than paying off your mortgage are compelling, it’s important to consider the psychological aspect.
The security and peace of mind that comes with owning your home outright shouldn’t be dismissed lightly.
However, in my mind, with careful planning and risk management, the financial benefits of investing in property can outweigh these psychological considerations.
Conclusion
Deciding whether to prioritise paying off your mortgage or property investment is a personal choice.
It depends on your risk tolerance, financial goals, and overall investment strategy.
If security and peace of mind are paramount, paying off your mortgage might be ideal.
However, if you’re looking to grow your wealth and achieve financial independence, investing in property could be a more strategic approach.
By leveraging your funds, taking advantage of tax benefits, and strategically using your funds to invest in property, you can make your money work harder for you, building a more prosperous future.
About Brett Warren Brett Warren is National Director of Metropole Properties and uses his two decades of property investment experience to advise clients how to grow, protect and pass on their wealth through strategic property advice.
It’s really a combination of our mindset, habits, and behaviours that rule our financial destiny.
Let’s look at 7 tips that could make you rich:
1. If you are born poor it’s not your fault, but if you die poor it’s your mistake
2. Don’t follow the herd
3. You should know how many months you have left in your wealth window
4. Practice delayed gratification
5. Don’t think you can ever make money by trading
6. Avoid Credit Card Debt
7. Insure yourself
Becoming financially fluent will be the best gift you can give yourself. And getting sound impartial financial advice along the way is not a cost, it’s an investment.
The maths behind financial independence is incredibly simple.
But, if that’s the case why do so few Australians achieve financial freedom?
It’s not for the lack of knowledge – there are so many money blogs, videos, and podcasts out there.
Instead, it’s a combination of our mindset, habits, and behaviours that rule our financial destiny.
So let’s look at 7 tips that could make you rich:
1. If you are born poor it’s not your fault, but if you die poor it’s your mistake
This quote is often attributed to Bill Gates, a self-made multi-billionaire who is now helping the world through his philanthropic work.
What he’s getting at is that you have to take responsibility for your financial future.
You have to become financially literate.
The problem for many is that becoming wealthy is a long journey and it’s not easy.
But then again why should it be easy?
If it were easy, then the rewards would not be so great.
2. Don’t follow the herd
Each of us has been hardwired by evolution with a desire to be part of a herd.
In the early days of humanity, being part of a herd meant survival.
With a herd, there was always someone on guard for predators or danger, and also certain herd members identified opportunities that could be beneficial to the herd.
However, that’s not the way it works with money unless you want to be average and follow the crowd of average folk.
But if you want to achieve financial excellence, one of the best things you can do is not follow the heart.
You need to break away from the pack, take your own path, and make the best choices for yourself as an individual.
Successful investors know that to get to the top of the property ladder, they need to overcome the fears that hold most people back from ever stepping foot on the first rung, or of not waiting for the perfect time or the perfect investment.
And they also understand the importance of, wait for it, going against the crowd!
Warren Buffet said it best, “Be fearful when others are greedy and greedy when others are fearful.”
3. You should know how many months you have left in your wealth window
Your “wealth window” is the time from now until when you stop receiving an earned income.
How much are you going to earn in that time?
Think about it…if you earn $100,000 a year for the next 15 years you will have $1.5 million passing through your hands.
The big question is: how much of this will you keep?
You have two important stages in your life: a saving and investment stage – this is what I call your “wealth window” and your spending stage – your retirement.
For many Australians there biggest asset is their income earning capacity over the rest of their “wealth window.”
Your financial future will depend on the balance between enjoying your money now and planning for “then.”
Which leads to…
4. Practice delayed gratification
If you want more money and freedom in life you’re going to have to practice delayed gratification.
Successful people possess higher patience and an aptitude to postpone the enjoyment of their work.
They have the ability to work hard to accomplish a goal which isn’t been achieved for a long time.
Learning to delay gratification rather than seeking immediate satisfaction is essential for success, particularly when it comes to things like investing, business, and making money.
Yet it’s not easy to change ingrained habits and the approaches to life that you’ve been practicing since childhood, but once you’re aware of the importance of the concept of delayed gratification, it’s entirely doable.
The problem is the average Australian focuses on survival and instant gratification.
They don’t think beyond the moment.
However, the very rich think and plan very far into the future—five, ten, or twenty years.
This picture may help you understand what I’m getting at.
The poor think about the moment— they can’t wait for their pay at the end of the week.
The middle class is hoping to make it through the month.
The rich are planning a year to several into the future, and the multi-millionaires are thinking a decade or two future.
Remember, if it comes too quickly, chances are you will lose it again just as readily.
All good things take time.
As Warren Buffet wisely said: “Wealth is the transfer of money from the impatient to the patient.”
5. Don’t think you can ever make money by trading
Whether it’s property, financial commodities, shares, etc.; trading is really a form of gambling, and the only people who seem to make money out of this are the trading “educators” and the “bookmakers.”
It’s interesting how people with an ego bigger than their experience believe they can beat the odds.
No, they can’t.
Instead, stick to the wealth creation strategies that have always worked; either investing in income-earning real estate, a business or a share portfolio.
6. Avoid Credit Card Debt
While credit cards can be very useful at certain times of your life, don’t use them to maintain an expensive lifestyle to impress people who you barely know.
This is a huge financial mistake.
Remember the balance on your credit card isn’t your money, it’s the banks’ and they’ll charge you for the privilege of using it.
7. Insure yourself
Insure yourself against bad surprises such as cancer, a heart attack, a car accident or death.
Most people set up their insurance as a consequence of devastating news about a friend or a loved one, but if you don’t insure yourself when you don’t need it, you will find yourself uninsurable when you do need it.
And then hope your insurance is a total waste of money.
The bottom line
Becoming financially fluent will be the best gift you can give yourself.
And getting sound impartial financial advice along the way is not a cost, it’s an investment.
It’s interesting that all the wealthy people I know have advisors and are happy to pay for them, while the average Australian gets their financial advice from Facebook or Twitter.
About Michael Yardney Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He’s once again been voted Australia’s leading property investment adviser and one of Australia’s 50 most influential Thought Leaders. His opinions are regularly featured in the media.
Many investors think that the hardest part of becoming an investor is searching for and finding the right investment property.
In reality, that’s only the beginning.
Once you own an investment property and become a landlord, you have to learn how to effectively manage it – and a huge part of this is ensuring that your tenants are happy.
After all, if they’re not happy living there, they’re going to move to greener pastures pretty swiftly.
In this article, we look at the most common tenant complaints about those living in apartments and how to overcome them.
It all begins with CLAP: Children, Landscaping, Animals and Parking.
1. Children
Children running around in a unit complex without much adult supervision are likely to attract the attention of other tenants, and not in a positive way.
We’re not talking about kids who like to take a scooter ride after school around the complex – but the cheeky children who shriek around the complex and go ‘door knocking’ (purposely or intentionally knocking on other tenants’ doors and then running away for “fun”, a game that can be very irritating and frustrating for neighbours).
Complaints regarding children can be targeted at those who live on the premises, or children who are visiting the complex temporarily. Importantly, a body corporate can’t refuse to let a dwelling to certain groups of people such as families, and complaints regarding children can be very difficult to manage. Children are, by nature, noisy little critters!
2. Landscaping
The quality of landscaping in common areas, as well as the ongoing maintenance and upkeep of said areas, can result in tenant complaints.
It’s not uncommon for a body corporate or owners corporation, which manages all of the owners’ in a building or complex, to receive complaints about lawns not being mowed, hedges not being trimmed or tree roots causing damage to paths.
For tenants, this can become a problem when trees or vegetation impacts their view or ability to use their home.
3. Animals
The issue of animals being kept in units or apartments has long generated heated debate amongst tenants, landlords, property managers and the wider community.
Anyone who has been stuck living near a heartbroken dog left locked indoors all day knows only too well how frustrating that can be: a constantly barking dog can be hard to ignore.
Other common complaints in relation to animals include toileting – as some owners don’t pick up after their pets – and damage to common property.
Keep in mind that laws have been introduced in some states that mean a body corporate or landlord can not reasonably refuse to allow someone to keep a pet.
4. Parking
Tenants parking in another tenant’s parking spot… tenants parking regularly in the visitor bays… tenants parking in the wrong spots altogether… visitors who overstay their welcome by using a parking space as their own private space… even tenants who make up their own parking spaces on grassy areas.
These are all potential causes of dispute between residents in a strata complex and could see your tenant making contact with you if they’re getting fed up with others doing the wrong thing.
5. Maintenance and upkeep
As a landlord, it’s up to you to ensure the property you are renting out is in good condition.
However, it’s the body corporate’s responsibility to maintain the building and ensure the upkeep of common areas – which means you don’t always have control over how well this is carried out.
Problems such as water leaks, mould build-up, pathways requiring repair and locks to mailboxes being broker can be the subject of a lot of complaints.
This is why it’s a good idea for you (or your property manager) to develop a good relationship with your strata manager – so you can ensure any issues are raised swiftly.
You may even choose to join the management committee.
6. Noise
This is a big one!
Excessive noise is one of the most common complaints that tenants can have, and for good reason: no one enjoys trying to fall asleep against a backdrop of a neighbour’s loud dance party music.
Your tenant’s noise complaints may be the result of just one regular offender, in which case it may be a little easier to address the issue.
Generally, most unit complexes don’t have more than one tenant repeatedly making excessive noise and complaints are often because of a party.
However, if the problem is ongoing – they constantly practice the drums at 10 pm, they hold regular parties, they stomp around the apartment or they watch television with surround sound as if it’s their own personal theatre, then it may need to be addressed.
7. Odours
If your tenant complains of an odour coming from their plumbing or bathroom, then it needs investigation fairly quickly – it could be the case that there is a blockage or other issue causing a build-up.
Also, when a tenant is living in closer quarters with others, it isn’t uncommon for strong cooking odours to be shared.
They might waft through mechanical ventilation systems and impact larger areas, or they might just be living so close to a neighbour that they constantly smell what they’re cooking up.
Containing or preventing this from happening is extremely difficult in a strata living situation, so tolerance is the key when people from different ethnic origins are cooking foods that have strong odours.
8. Smoking
On the topic of smells – smoking is another major area of dispute amongst tenants.
Under the Tobacco and Other Smoking Products Act 1998, smoking in enclosed areas of a common area is prohibited, so if your tenant complains of another resident smoking in the car park or the front entry, that can be addressed fairly quickly.
A tenant smoking in their own apartment, on the other hand, is much trickier to manage.
There have been some legal rulings over the years regarding smoking within units, where the smell escapes through the balconies, under doors or into the extraction system.
These rulings have found that a body corporate doesn’t have the authority to prohibit smoking within a unit, including on balconies as these are private homes.
However, somebody corporate schemes have passed by-laws that state residents are not permitted to smoke on their balconies, where it causes a nuisance to neighbouring units.
As you can imagine, these by-laws can be very difficult to enforce – so this is an area you need to work very closely with your property manager and body corporate manager on.
9. Damage to common areas
When many different people use a communal area, there’s an expectation that everyone will do the right thing to maintain and present these locations to a high standard.
Of course, this isn’t always the case.
Strata managers and property managers report that the most common complaints regarding communal areas often stem from issues with people using pools and barbecue areas, and not cleaning up after themselves.
It can also create problems if tenants attempt to use common areas for their own private use on a more regular basis when they are designed to be shared by all of the residents in the complex.
10. Lack of privacy
When it comes to apartment living, most residents relish the privacy within their own four walls as they are sharing so much of their “home” with others.
As a result, tenants tend to become disgruntled if the landlord, on-site manager or property manager come knocking too often.
You can’t just drop past and visit your tenant or your property without warning: this is not just a matter of politeness, it’s the law.
You are required legally to notify your tenant at least 24 hours before entering, with the only exception being a direct emergency.
11. Pests and cockroaches
This is another problem that can be difficult to manage in a strata setting.
If you own a freestanding home and there is an infestation of ants or cockroaches, the solution is fairly straightforward: hire a pest inspector.
However, when it comes to apartment living, there’s no point in you getting a pest treatment on your specific unit if others in the complex don’t do the same.
Otherwise, you’ll clear the infestation from your property… and it will return within a week or two.
If your tenant complains about an ongoing issue to do with pests, it’s a good idea to chat to the strata manager to see if other residents are having the same issue, so you can investigate a more holistic solution.
12. Difficulty reaching you (or your property manager)
This last one falls on you as the landlord.
A difficulty reaching you (or your property manager) and a lag in getting a response is one of the most common tenant complaints, and for good reason.
It’s frustrating for anyone to feel as though they’re being ignored, but even more so when they’re trying to reach you about an issue to do with where they live.
It might be your property, but it’s their home.
Hiring an experienced property manager who has a reasonable rent roll (ie isn’t overworked) is the key to success here.
How to Resolve a Dispute
There are clear and straightforward methods for dealing with disputes, depending on your state and territory.
Generally, if an issue can’t be resolved verbally through open and honest discussions, the unhappy tenant and/or the property owner has the option to submit a form to the body corporate advising a breach has occurred.
If the body corporate is in agreement, then a breach notice is issued.
If the body corporate considers that a breach hasn’t occurred, then the party can make an application to start proceedings through court.
If your situation reaches this point, it is best to liaise very closely with your property manager for advice and guidance.
Whilst this can be a very stressful situation and is often new territory for you, this is all in a day’s work for property managers – they deal with disgruntled tenants every day.
Note that a body corporate can also seek an order from the office of the Commissioner of Body Corporate and Community Management, or approach the Magistrates Court.
An adjudicator appointed by the Commissioner’s Office may issue an order stating the tenant must stop the behaviour that’s constituting the breach.
Just because the breach has been issued, it doesn’t mean the behaviour will stop.
However, the fines on offer might be a powerful motivator: if an order issued by the adjudicator is ignored or the breach continues, the body corporate can pursue the matter through the courts, which can impose a maximum penalty of $44,000.
The Magistrates Court can impose a fine if a party is deemed to be in breach of the by-laws, which can be up to $2200.
All of this represents the worst-case scenario and there is a conciliation process that usually helps avoid going to these lengths.
Most problems can be solved by having an independent third party assist with the negotiations.
Again, be sure to work closely with your property manager so you’re not dealing with all of this on your own.
How are By-Laws Enforced?
The body corporate is responsible for enforcing the by-laws of its complex.
The committee as the administrative arm is usually responsible for ensuring all owners and occupiers comply with the by-laws.
However, owners and occupiers can also commence with the issue of mandatory notices, however, there are limited circumstances in which the service of a notice isn’t required.
It’s a preliminary procedure that contravention notices must be issued before any formal enforcement action is taken.
The decision to serve a contravention notice can be made by the committee or by the body corporate.
Types of contravention notices
1. Continuing Contravention Notice
The body corporate may give a continuing contravention notice to an owner or occupier where it believes the person is contravening a by-law and where it’s likely the contravention will continue.
An example of this type of contravention is where an owner is parking a vehicle of common property without approval.
The purpose of this notice is to require the person to remedy the contravention.
In other words, you are letting them know that their actions are not permitted and you’re giving them the opportunity to halt the behaviour.
2. Future Contravention Notice
The body corporate may serve a future contravention notice if it believes the person has contravened a by-law and the circumstances of the contravention make it likely the contravention will be repeated.
This notice would be appropriate when an owner has a noisy party that contravenes the noise by-law, and they have demonstrated through previous behaviour that they are likely to do this again.
The body corporate may give the owner notice that if this contravention is repeated.
Proceedings can be commenced without any further notice.
The purpose of the future contravention notice is to require the person not to repeat the contravention.
3. Consequences of Failing to Comply
If an owner or an occupier fails to comply with a contravention notice, the committee, or the body corporate in a general meeting, can decide to commence enforcement proceedings in the Magistrates Court or in the Body Corporate and Community Management (BCCM) Office.
The BCCM Act empowers the Magistrates Court to impose a financial penalty for failure to comply with the notice.
Translation – you can find another tenant or resident for failing to comply with the by-laws in your complex.
When an Owner or Tenant Complains
If an owner or an occupier reasonably believes another owner or occupier has contravened the by-laws or it’s likely the contravention will continue, he or she must take a preliminary step before taking action in the BCCM office.
The owner or occupier (‘the complainant’) must ask the body corporate to issue a contravention notice to the person who is allegedly contravening the by-laws.
If the body corporate doesn’t advise the complainant that the contravention notice has been issued within 14 days after receiving the request, the complainant may take action in the BCCM office.
About Leanne Jopson Leanne is National Director of Property Management at Metropole and a Property Professional in every sense of the word. With 20 years’ experience in real estate, Leanne brings a wealth of knowledge and experience to maximise returns and minimise stress for their clients.
As the modern workplace changes, commercial properties as old-fashioned office plans are replaced by more creative ones. In particular, coworking spaces are becoming increasingly common as a solution. More and more, workers who want to be more productive are choosing these shared places. In addition to giving people a place to work, coworking areas have many other advantages.
This piece will talk about 10 ways that coworking spaces can make you much more productive at work.
1. Collaborative Atmosphere
People from a huge range of businesses and backgrounds come to coworking spaces, which make them real melting pots of professional variety. This mix of different skills, experiences, and knowledge creates a great place to work together where experts can easily combine their areas of expertise.
The energy in these places encourages people to share their ideas, knowledge, and skills, making them great places for coming up with new solutions to problems and ideas. Professionals from different fields naturally interact with each other, which not only allows ideas to spread but also leads to the creation of new views and approaches.
2. Networking Chances
The social aspects of coworking spaces are a big plus because they make it easy for people to meet new people in the same field and build their business networks. Talking with coworkers, business owners, and freelancers in these shared spaces allows you to make connections beyond the walls of a normal office.
The variety of workers who work in coworking spaces creates a unique networking environment that makes it easy to share ideas, learn about the industry, and look for ways to work together. People who work together often find that they have similar interests, skills that support each other, and goals when they talk casually about shared amenities, during coffee breaks, or at networking events.
3. Flexibility and Convenience
Coworking places let you choose your hours and where you work. People can set their work hours to match their most productive times when they can access their work 24 hours a day, seven days a week. This makes them more productive and improves their work-life balance.
4. Access to Resources
Coworking spaces emerge as cost-effective and resourceful solutions for professionals due to their provision of cutting-edge amenities. These shared environments often boast state-of-the-art facilities such as well-equipped meeting rooms, high-speed internet, and office supplies.
The availability of these amenities eliminates the need for individuals to invest their resources, providing a cost-efficient alternative to traditional office setups. In a traditional work setting, acquiring and maintaining such high-tech resources could be a significant financial burden for an individual or a small business.
5. Programs for Professional Growth
There are many ways to improve your skills and learn new things in coworking spaces, which makes them great places for career growth. Through carefully chosen classes, seminars, and skill-building programs, these places keep people updated on the latest field trends and promote a culture of always learning.
Professional growth is easier for people in the coworking community because these kinds of events are easy to get to. This dedication to ongoing education makes members more productive by ensuring they stay up to date on the newest ideas and methods and adds to the coworking ecosystem’s overall intelligence.
6. Fewer Distractions
Working from home has problems, like taking care of the house and dealing with family interruptions that can be very distracting. People find that coworking spaces are the answer to these problems because they give people a dedicated, professional workplace.
Unlike your own home, coworking spaces are made to be places where you can work, with a structured and distraction-free setting. People can set a boundary between their work and personal lives by being physically away from household chores and family interruptions. This helps them stick to a more
7. More Motivation and Accountability
A big part of what makes sharing spaces so motivating is that everyone uses them together. The collaborative setting, surrounded by workers with similar interests focused on their work, makes people more accountable and motivated.
When everyone in these shared places is focused on work, it creates positive peer pressure that pushes people to reach their professional goals. Everyone in the coworking space’s shared commitment, energy, and drive make it even more motivating. This means that coworking spaces are not only good for getting work done, but they can also help people reach their goals.
8. Wellness and Balancing Work and Life
Wellness programs are becoming more important in coworking spaces, and people are working hard to make places that put health and productivity first. These places are meant to be healthy workplaces, with features like ergonomic chairs and fitness programs that cover the whole body.
The focus on well-being not only makes people feel better physically, but it also makes the workplace happy and more productive. Coworking spaces try to improve their employees’ professional and personal health by focusing on the whole person. They do this because they know that happiness and success at work are linked.
9. Connectivity Around the World
As working from home has become more popular, coworking spaces have become hubs for professionals working for companies or customers worldwide. This global connectivity encourages an open and diverse workplace by exposing people to different ideas and ways of doing things, eventually boosting creativity and productivity, just like this coworking space Melbourne.
Beyond their main purpose as places to work, coworking spaces offer many benefits that aren’t just useful for professionals because these places are often used for neighbourhood events, social gatherings, and group projects; they help teams work together and stay together.
The sense of community that these events create makes for a good and helpful environment, which affects people’s general health and productivity. By going beyond the usual work limits, coworking spaces become lively places where teamwork and community involvement create an atmosphere for personal and professional growth.
Coworking Spaces Will Make Your Work Experience Better
Overcoming the traditional office model, coworking spaces have become lively places encouraging teamwork, new ideas, and professional growth.
Note: Along with providing a physical workspace, these shared spaces are now essential for people managing the constantly changing modern workplace.
Coworking places offering flexibility, chances to network, and a supportive community meet the changing needs of a diverse workforce. A melting pot of ideas is created when professionals from different backgrounds work together. This increases productivity and broadens people’s views.
About Guest Expert Apart from our regular team of experts, we frequently publish commentary from guest contributors who are authorities in their field.
