5 Frequently Asked Questions about the lockdown

Commonly asked questions about the Lockdown

Every day I’m communicating with owners of rental properties here in Dunedin. They can be categorised into two groups: a) Ex-Airbnb users seeking new long term tenants, and existing customers concerned about how the lockdown will impact their rental. Below are FAQ from these two groups.

1. do you have any good tenants looking for a place ?

Yes we do. There are currently thousands of New Zealanders returning home and after their isolation period they are in need of a place to stay. If you’d like to access our list of people looking for homes then please contact us.

2. can new tenants move in during the lockdown?

Maybe but in most cases the answer is no.

During Level 3 and Level 4 moves can occur in extreme circumstances but they must take care to not violate any Alert Level rules. For example, New Zealanders returning home from overseas, will need to do everything digitally or remotely. They cannot go into offices to pick up keys. Tenants can only move in their private vehicles with members of their household bubble and cannot hire a moving service.

3. what happens if my tenant loses their job and can’t pay the rent?

Many people in NZ have lost their jobs or are on reduced wages. As a result, there are many people struggling to pay their rent or their mortgages. As a solution, the Government released Financial Support package providing wage subsidies for workers and banks have launched the Mortgage Holiday scheme

We are supporting all our tenants who are under significant financial stress by offering different rent options:

a) a rent holiday - in extreme situations, e.g. where the tenant loses their income, is not eligible for financial support, and can’t get another job, but who in the past has been an excellent tenant then we would consider offering a short period (e.g. 4 weeks) where the tenant does not have to pay any rent. These can be both repayable or non-repayable via a one off payment or installments.

b) a temporary rent reduction - similar to a) except the rent doesn’t go to zero but to a discounted amount. This can also be repaid or not.

Each variation is considered on a case by case basis. I speak to the owner and their financial situation is included in the equation. The last thing we want happening is for the tenant to leave. Regardless of the changes that we negotiate we put in writing. This changes follow the terms of S24A of the Residential Tenancy Act, that requires the variation to be in writing, signed by both parties, and delivered to the tenants before the reduction takes effect.

4. can i evict a tenant during lockdown?

Yes, but only for a limited number of reasons.

The speedy changes to the Residential Tenancy Act by the government means that it is more difficult to terminate a tenancy. You can only evict a tenant for the reasons below:

a) when the tenant substantially damages the premises

b) when the tenant assaults or threatens the landlord, the family, or neighbours,

c) when the tenant abandons the property

d) when the tenant engages in significant anti-social behaviour,

e) when the tenant is 60 days behind in rent.

During the lockdown period we are disallowed from conducting inspections of any kind and so we may not be even aware if many of the reasons above have occurred. Even if we suspect ‘substantial damage’, for example, we wouldn’t be able to collect evidence for the tribunal submission. The normal Tenancy Tribunal process will occur except they are conducting hearings via telephone or video conference.

These new regulations will be reviewed by the Government after 3 months time.

5. can we do maintenance or repairs?

Yes, but only for emergency repairs. No, routine maintenance or renovations.

The challenge for this however, is that most tradies are not working. Those that are, have long waiting lists, and cost more due to the need for PPE and other precautions.

Fortunately, at Dunedin Property Management, we have good relations with a long list of qualified tradespeople and so we can get those emergency repairs done quickly.

SUMMARY

The COVID-19 lockdown has made life difficult for everyone. When this crisis ends we will not return to the same normal way of being. Everything will have changed. We need to prepare for any eventualities. We are here to manage the risk of our owners as best as possible. If you want to speak to someone about how Dunedin Property Management can help you. Please give us a call.