What landlords can and can’t do at Alert Level 1
The most frequent questions I’m receiving are around what the move to Level 1 means to the rental sector. There’s confusion around what landlords can and can’t now do, which is not surprising given the poor communication and mixed messaging on this topic.
Most of this stems from the draconian measures which were introduced back in March. At the time, I was strongly critical of the way in which the Government was dealing with the rental sector during lockdown by introducing a raft of emergency measures to protect tenants without any matching support for landlords. Landlords are concerned to know if these rules have now been relaxed.
Indeed, while businesses within other sections of the economy were being supported While most Kiwis accepted the degree of sacrifice implicit in the restrictions, I’m not sure that one sector should carry more of the burden than others. through the wage subsidy and other initiatives, landlords — who collectively house around 40 per cent of our people and who were already under attack by this government prior to Covid 19 — were being expected to carry the additional strain on the housing sector at their own cost.
The measures put in place meant that landlords have not been able to evict tenants except under “extreme circumstances”, have not been able to press for the payment of unpaid rent unless there has been nonpayment for more than 60 days, have not been able to replace tenants who choose to vacate a property and, in many cases, have not been eligible for deferral of mortgage payments if they are suffering hardship.
While most Kiwis accepted the degree of sacrifice implicit in the restrictions, I’m not sure we believed that one sector should carry more of the burden than others, so it’s worth reviewing what’s changed since the move to Level 1.
Rents are still frozen
The original rent freeze provision was for the six months between March 26 and September 26 (one week after the election) and this is still in place. There is currently no information to indicate whether this freeze will be renewed or removed after September.
Tenancies can now be terminated
During lockdown (and even more recently) it has been impossible to terminate a tenancy except under extreme circumstances. However, from June 26 landlords can give notice to terminate a tenancy under the normal provisions of the Residential Tenancies Act.
Restrictions on freedom of movement are gone
There are no restrictions on moving house, open homes, carrying out maintenance or undertaking scheduled inspections. For all intents and purposes we’re back to business as usual.
Tenants are still liable for unpaid rent
Although landlords couldn’t evict a tenant for unpaid rent during lockdown, rental arrears are still owed. Collecting unpaid rent still needs to be undertaken through agreement with the tenant, or through the Tenancy Tribunal if the former approach fails, but you’re legally entitled to do this. The rent hasn’t just been written off by decree (unless you choose to do this yourself).
Provisions around notice periods are still unclear
Some tenants were in the process of moving out when the lockdown restrictions were imposed and may have been part-way through a notice period. It’s not clear whether the terms of that notice period simply pick up from the date that we went to Level 1, whether the notice period starts again, or whether there is some other provision to cover this scenario. My suggestion would be to try and resolve this amicably with your tenant, but if you’re unable to do this you’ll need to call Tenancy Services.