Navigating your way through Covid-19
We can imagine there have been many unanswered questions around Covid-19 and where we go from here? Here are some of the most commonly asked questions regarding renters and owners and what you can and can’t do during this time.
COVID-19 Freeze on rent increases
The government has announced a freeze on increasing rents for an initial period of six months under Section 4 of the Covid-19 Response (urgent management measures) legislation act 2020. This came into effect on 26 March 2020.
What does this mean for landlords:
This means that the weekly rent you currently charge a tenant cannot increase at all during the period of the rent freeze.
Tenants still have an obligation to pay rent as usual during this period and are still liable for any rent arrears.
Be aware that if you breach the rent increase freeze and put your tenants rent up during this time it will be deemed to be an unlawful act and carries a fine of up to $6,500
I gave my tenant notice of a rent increase prior to the legislation change, can this still take place?
Unfortunately not.
If you have spoken to your tenant about a rent increase recently or have given them the usual 60 days notice to increase their rent that increase is unable to go ahead.
No matter when you gave them notice about the increase, no increase is allowed if the date the rent was to go up comes into effect from the date of the law changes which is 26 March 2020.
If your tenant has already started paying an increased rent then that increase remains in place.
Can I terminate my tenant during the lockdown period?
No you can’t
As well as a freeze on rent increases the Government also passed legislation to be in force for an initial period of three months (but may be extended) which gives tenants protection from having their tenancy terminated during the lockdown period.
What does this mean for landlords?
Prior to this change in legislation (which is currently only in place for three months) if a tenant was 21 days in arrears you could apply to the tenancy tribunal to terminate the tenancy. The government amended this law effective from 26 March 2020 so that now you aren’t able to apply for a termination until the tenant is 60 days in arrears.
What this means is that you are unable to give your tenant notice during the lockdown period unless:
- Both parties agree
- Or for a set of limited reasons which are:
- The tenant substantially damages the property
- The tenant assaults or threatens to assault the landlord, their family or the neighbours.
- The tenant abandons the property
- The tenant demonstrates antisocial behaviour such that causes significant alarm or distress to others
- The tenant is 60 days behind in rent and has no made reasonable effort to pay the rent
Be aware that if you breach the rent increase freeze and put your tenants rent up during this time it will be deemed to be an unlawful act and carries a fine of up to $6,500.
If your tenant gave you notice prior to the lockdown period commencing they have the choice to either terminate the tenancy as normal or to stay in the property until lockdown has been lifted. Having said that tenants are asked to move during lockdown only if absolutely necessary and to consider if they are managing the risk of spreading Covid-19 if they do move.
My property is vacant, can I do viewings during the lockdown period?
No you can’t.
Your property manager/leasing agent or you are not classified as an essential service during the lockdown period so viewings of the property aren’t able to be done. There is the option of pre-recorded videos/photos if you are a technical whizz kid.
Renthub does offer a virtual viewing service, so if you have a vacant property and you are interested in this service please contact us at office@renthub.nz
Am I able to do a property inspection during the lockdown period?
No you are not.
Property inspections should be deferred until after the lockdown period. We suggest though that you contact your insurance company and get in writing that should there be a need to claim on your insurance policy that they will honour the claim if an inspection wasn’t completed.
It is possible to complete online inspections. If you would like assistance with this contact us at office@renthub.nz
Am I able to do maintenance on my rental property during the lockdown period?
If the maintenance required is classified as an urgent repair such as the oven not working, hot water supply compromised, leaking water cylinder etc this would be classed as an essential service and could be completed during the lockdown period.
Any non-essential maintenance work must be put on hold until after the lockdown period is lifted.
Am I able to move back into my rental property during the lockdown period?
The government want to ensure that during these times of uncertainty that tenants aren’t able to be evicted because the landlord or family want to move into the property.
For this reason for the next three months a landlord can’t give a tenant notice so that they or their family can move in.
My new tenants were due to move into my rental property during the lockdown period, can they still move?
In the first few days of New Zealand going in to Stage 4 lockdown there was a lot of conflicting views about whether a tenant could move during lockdown.
Whilst moving isn’t prohibited under Covid-19 Response (urgent management measures) amendment act it is recommended that any moves should only occur in very extreme circumstances such as:
- If arriving from overseas and needing to move to a property
- In a domestic violence situation
- Homeless
Wherever possible travel should be restricted to essential travel only. If tenants do need to move because of the above reasons they must only get assistance from those that are in their bubble
Fixed term tenancies
For a period of the next three months fixed term tenancies will convert to a periodic tenancy unless both parties agree otherwise or the tenant gives notice.
What does this mean for landlords?
You now aren’t able to terminate a fixed-term tenancy during the three months from 26 March 2020 unless the tenant agrees. What this means is that your fixed term tenancy with the tenant will automatically roll over into a periodic tenancy.
No cause terminations
For the next three months you are not allowed to issue a tenant with a 90 day no-cause termination.
What does this mean for landlords?
If your tenant currently has a periodic tenancy you are able to give them a 90 day notice to terminate their tenancy and don’t have to give a reason.
The government have changed this for the next three months under Section 4 of the Covid-19 Response (urgent management measures) legislation act 2020 which means that you now can’t give a tenant notice.
To terminate a tenancy you will need to apply to the Tenancy Tribunal.
