25 Mar 2020

Tenants told skipping rent not an option

6:34 pm on 25 March 2020

Rental agencies are getting tough on tenants with ideas about skipping their rent payments.

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Photo: 123rf.com

Emails from property managers are telling tenants to speak with their employers, approach Work and Income for advice or borrow money from the bank if they anticipated difficulties paying on time.

It comes after an announcement on Tuesday that people with mortgages may be able to get a six-month break from paying principal and interest if their incomes are affected by Covid-19.

Some renters described the scheme as "unfair", predicting that their landlords enjoy a holiday from their bills while demanding rent in full.

Andrew Darrell, who owns several properties in Christchurch, said that was not the case.

"Like everyone else, I am very worried about how I will be paying the bills and feeding my family over the coming weeks/months," he said.

He said a mortgage holiday wasn't free money, because interest payments will still need to be paid in the future. He said it was unfair to put pressure on landlord to drop rents, when it would make his own costs rise in the future.

"However, I expect rents will drop over the coming year due to border closures and AirBnB properties flooding the market. So, longer term with lower rents and rising costs, there is a real chance I could go bankrupt, the properties get sold, tenants probably get evicted, I lose my house and nobody wins," he said.

In an email sent to Harcourts tenants in Christchurch, the agency reminded people that there were also variety of financial measures to keep money flowing into the community and through the economy.

At the moment, the agency said its expectation was that rent would continue to be paid as usual and it suggested "you should engage with your employer if you are concerned about getting paid."

"Work and Income will continue to pay benefits as usual and they are also fast tracking alternative assistance for those who have been made redundant." it said.

Another smaller agency based in Auckland was asking for anyone struggling to pay rent to get in touch before going into arrears.

But in a comment that left one of its renters "outraged" and "very frustrated," it said "a bank overdraft may also be a short term solution to consider".

"I too would like to see more from the government in terms of how they can support renters during this period," the renter said.

"Let's face it, by renting this place we are paying off their mortgage," the renter said.

But property management company Quinovic was also reinforcing what it expects from tenants and encouraging them to "seek help" if they experience financial issues.

"All rent must be paid as per normal," it said.

"If you fail to pay the normal breach notices will be issued and if needed, applications will be made to apply to terminate."

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