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COVID-19 – how does it affect your rental property?

By Katrina Green

As we continue to tackle the impact the COVID-19 Level 4 lockdown is having on all of us I wanted to share some information which may assist both tenants and landlords in this time of uncertainty which surrounds us all.

What will happen to my job, my home, life as I knew it before COVID-19?

Although I am obviously unable to answer these questions, what I can help with is some education around what we do know in relation to residential tenancies during this time – The facts!

Communication is at the heart of every successful relationship, and this certainly is one of the most important components for tenants and landlords, particularly in our current situation.

At a time where much confusion and anxiety can exist, we want to ensure that all tenants and landlords have the answers they need surrounding COVID-19.  The COVID-19 Response (Urgent Management Measures) Legislation Bill came into law on the 26 March,
creating a number of changes both tenants and landlords should be aware of.

Tenancy Terminations or Vacating Notices
• Under the emergency legislation, tenants cannot be given notice to vacate their property for at least three months (until 26 June). This exclusion period may be extended for a further three months (until 26 September).
• Vacating notices that were previously sent but were yet to come into effect are now void.
• Tenants can still give normal vacating notice as per pre- COVID-19 rules (e.g. 21 days notice in periodic tenancy etc).
• Landlords cannot terminate a tenancy unless for very specific reasons outlined in the new Act. If a landlord has already given a termination notice that was due to come into effect, the notice is now void unless it falls under one of these reasons. They are:
• Substantial property damage
• Assault or threatening behaviour
• Abandonment of the property
• Significant antisocial behaviour
• Rent arrears of 60 days or more.

Rental Increases
• Under the emergency legislation, rents are now frozen at their current level for a minimum of 6 months (until 26 September).
• All rent increase notices previously sent to tenants that were yet to come into effect are now void.

Rent Arrears / Rent Reduction Requests
• Monitoring of and communicating arrears to those involved should still continue, however, in all cases tenants and landlords should talk openly with each other. The legal and insurance based arrears obligations can still continue alongside the compassionate treatment of tenants.
• If a tenants ability to pay the full rent is compromised they should still try to pay as much of the normal rent as possible. Failure to pay the rent or communicate with landlords can lead to future consequences for tenants. The Tenancy Tribunal has indicated tenants must still make all reasonable efforts to honour their obligations.
• Landlords should be flexible with their tenants, wherever possible. Rent changes must be mutually agreed, however, the Tenancy Tribunal has indicated in future arrears cases they want to see evidence landlords have attempted leniency if a rent change request is made.
• If you’re a landlord providing a temporary rent decrease or rent deferral, or you’re a tenant making a request to your landlord, clearly outline all the terms in writing.
Include the following key points:
• If requesting as a tenant, consider the value in providing evidence to your landlord proving hardship, where possible. It is not required, however, can certainly strengthen any request.
• The start date and end date of temporary reduction/deferral.
• State both the current weekly rent figure, the new reduced amount, and the current rent figure reinstating after any reduction/deferral period.
• In a rent deferral situation, confirm details of the repayment plan that will occur later e.g. start date, repayment amounts and frequency, what may happen should repayments not be honoured.
• Consider the value in offering or requesting a written acknowledgement to review and update or extend any rental terms by mutual agreement, if required.

Routine Property Inspections
• During the Alert Level 4 lockdown, we recommend routine inspections are deferred until further notice.
• The New Zealand Insurance council have indicated insurance policies will be honoured providing any deferred inspections are completed as soon as these can be conduct safely.
• Tenants and landlords may wish to work together in completing virtual inspections where the tenant provides feedback, photos or evidence etc, however, this should be by mutual agreement.
• If the Alert Level 4 lockdown period is extended further there may be a need for tenants and landlords to work together to complete virtual inspections, however, this extension is as yet unknown.
• Landlords should seek advice from their specific insurer as to how their policy may be handled in this regard.

Property Maintenance
• All urgent or emergency repairs, and legal tenancy requirements, can take place and these are classed as essential services. e.g. plumbing, electrical, locks etc.
• What is an emergency repair? Where a failure to remedy any repair will create a risk to the health and safety of the inhabitants or cause damage to the property, this should be classed as an emergency repair.
• All non-urgent repairs and maintenance should be recorded and deferred until the Level 4 restrictions have been lifted.

Handy Resources 
Ministry of Housing & Urban Development
Here you can find links to the emergency legislation and an informative Q&A document.
Tenancy Services
General information for both tenants and landlords e.g. emergency repairs and how to classify.
COVID 19 Government site
Government updates to COVID-19 and financial support information for tenants and landlords.
Work and Income
Resources for tenants and landlords to seek financial support and assistance.

Ministry of Health
The latest news and updates on the current COVID-19 situation in New Zealand.

This information is correct at the time of writing (8 April 2020), however, may be subject to change. Tenants and landlords should seek further advice through the official sources listed above, or feel free to contact us for the latest updates.

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