Corona Crisis: What Property Owners Need TO Know Now. The corona crisis is also affecting property owners, landlords and home builders—answers to the most critical questions.
There are lots of companies that have registered short-time work for their employees since the beginning of the corona crisis. Many employees are afraid of unemployment, and thousands of self-employed are worried about orders and customers. The financially insecure situation also affects many property owners, home builders and landlords.
What if I can no longer pay the instalments for my mortgage lending due to short-time work or the loss of self-employed contracts?
First, you should contact your bank immediately and not just stop making payments. Anyone who gets into a financial need as a result of the corona pandemic can defer their due instalments, interest payments and repayments for construction financing. The rule applies to consumer loans and real estate loans till planned day. -it could change all over the world
IMPORTANT: The interest and repayment payments are only deferred – not waived. The instalments due must be paid later and extend the loan agreement accordingly.
Is it possible to temporarily adjust the repayment rate for my mortgage loan?
Many banks and mortgage lenders are currently offering their customers the option of suspending repayments or interest payments for a time. Anyone who has agreed on a repayment rate change in their mortgage lending contract can change the repayment amount and adapt it to their current financial situation – for example, the new amount of family income due to short-time work.
DISADVANTAGE: By lowering the repayment rate, it takes longer for the loan to be paid off. And usually, only one repayment rate change is possible.
TIP: It is best to clarify with your advisor or mortgage lender in advance, whether it is possible to change the repayment rate again after the crisis.
I own multiple condos. A tenant cannot currently pay his rent. What now?
If your tenant has got into financial difficulties as a result of the pandemic, for example, because he has lost his job, is on short-time work or is about to go bankrupt if you a freelancer or self-employed person, you are currently not allowed to terminate him due to the arrears in payment. This is what the federal government has stipulated in its “Law to Mitigate the Consequences of the Covid 19 Pandemic”. As a landlord, you have to accept a deferral of rent payments and ancillary costs until the last day. If you as a landlord are affected by deferred rental payments, you can apply for tax relief, for example, the deferral of due taxes at your tax office.
What effects does the corona crisis have on building owners?
In general, construction companies and manual workers are allowed to continue working in compliance with the hygiene and distance rules. However, since many construction companies employ skilled workers from abroad or maybe employees are sick or in quarantine, there may be staff shortages – or bottlenecks in material procurement. Building owners should, therefore, currently expect delays. The necessary approval procedures for the construction project may also take longer. The three-month grace period for the home loan also applies to everyone who is currently still in the construction phase of their property. However, you have to pay the bills from artisans and property developers.
Does it make sense to plan to buy or build your property currently?
Real estate as a real asset is an excellent and crisis-proof form of investment. Building your own house or buying an apartment is one of the most significant financial decisions of a lifetime for most people. And should therefore always be planned and well prepared for the long term. The corona pandemic does not change that. The interest rates on real estate loans are still at historically low levels. The pandemic has not yet had any substantial effects on property prices. How that will develop in the medium term is currently difficult to predict. If you are planning a property for your use or as a long-term investment, you can now continue your search for a suitable property. However, many apartments and house tours are currently digital. As a rule, however, on-site visits are also possible in compliance with the distance and hygiene rules.
Crucial When Planning Mortgage Lending
Every borrower should have a safety cushion. This reserve for lean financial periods – for example, due to unemployment, illness or even family time – should amount to at least three net salaries. The current situation shows: When financing your real estate, pay attention to flexible conditions that allow repayment breaks, changes in the repayment amount and outstanding repayments.