25 Mar 2020

Coronavirus: Tenants group calls for more help for renters

10:19 am on 25 March 2020

A mortgage holiday repayment scheme is being welcomed by landlords, but hitting all the wrong notes with some renters who want more relief measures of their own.

14588891 - rental agreement form with signing hand and keys and pen

Photo: 123RF

In a bid to ease financial pressure from Covid-19, the government announced yesterday that people with mortgages will get a six-month break from paying principal and interest.

Christchurch man Sean Raddock, who has four children to support and a temporary job at a factory, is among renters for whom the future isn't entirely certain.

He said there was a chance his job might be put on hold for the next four weeks, and he wasn't quite sure how he would get by - so the news his landlord could be getting a break from their bills wasn't warmly welcomed.

"I can understand what the government are trying to do. But at the end of the day it's not just those who have a mortgage that are struggling, it's everybody," he said.

His sentiment is echoed by another Auckland renter who is on a benefit and said she had been inundated with medical costs for herself and her daughter.

The woman, who asked not to have her name used, said the prospect of paying rent over the next four weeks was terrifying.

"Why are they having one rule for one set of people, and one rule for another set, just because their name is on the ownership of the house. It's not fair at all," she said.

Renters United spokesperson Anna Mooney said the priority for the next four weeks was making sure people were not evicted from their houses.

After the government announcement about mortgages, she said Renters United would like to see something that's going to help renters pay their rent.

That might mean a little more sympathy from landlords if their tenants can't quite make the rent on time or pay it in full, she said.

"Landlords and tenants should be having open conversations now about how they can work together. Whether that means landlords are helping out tenants, or reducing their rent - that would be really good," she said.

Finance Minister Grant Robertson also encouraged landlords and tenants to discuss how the mortgage holiday would work.

Robertson told Morning Report the scheme was effectively a payment deferral.

He said the government had announced a freeze on rent increases during the lockdown period and put in protections so tenants could not be evicted during this time unless they were engaged in illegal behaviour.

Read more about the Covid-19 coronavirus:

Auckland landlord cuts tenant's rent

That is exactly what some landlords are doing, including that of Auckland renter Jess Keating, who was told via text yesterday her rent would be dropping by nearly 40 percent for the next four weeks.

With two young children to support and her husband currently looking for work, the news was welcomed.

"I actually had a little cry, because it's really encouraging at a time like this. It's not just what it signifies in terms of literal money in your bank, it's more that ... kindness, and generosity of humans to each other, will help us get through this," she said.

But Raddock said some landlords would be happy to take full advantage of the scheme and still demand the same rent.

In the long run, he said, that would widen the gap between landlords and tenants.

"House prices are higher than they ever have been in this country.

"I'm 35 years old and still not even close to being able to afford a house yet and I know a lot of people in the same predicament.

"It's just going to exacerbate that a lot more, because we're going to have to spend a lot more money because we can't go to work, or have to dip into our potential house savings to try pay rent," he said.

National Party leader Simon Bridges said rents should be paid but there should be no increases.

"If [renters] can't pay I would expect the government to be doing what it can to help them," he told Morning Report.

"Right now, for a landlord, is clearly not the right time to be putting up your rent in the situation New Zealand faces - we're all in this together."

Details about the mortgage holiday repayment scheme will be announced by individual banks in coming days.

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