Govt doubles rent arrears support
Hon Carmel Sepuloni
Minister for Social Development
Hon Kris Faafoi
Associate Housing Minister (Public Housing)
Govt doubles rent arrears support as tenancy termination restrictions lift
As current restrictions on tenancy terminations ends under Alert Level 1 on 25 June, the Government is extending and increasing Rent Arrears Assistance to support people at risk of being evicted because they are unable to pay rent, Minister for Social Development, Carmel Sepuloni, and Associate Housing Minister, Kris Faafoi, announced today.
“People may have accumulated rent arrears due to a temporary change in their income under the impacts of COVID-19. The Assistance will ensure people who may have built up a rental debt, can stay in their homes while they pay the rental arrears,” said Carmel Sepuloni.
“This support is available for a range of people including those who are working. Keeping people in their homes is a priority.”
In November 2019 the Rent Arrears Assistance Housing Support Product was introduced to provide people with financial support from MSD so they could pay back rent they owed to landlords. The Government has extended this using COVID-19 Response and Recovery Funds to double the amount of rent arrears assistance people can receive and making it easier for people to apply.
The extension of the Rent Arrears Assistance Housing Support Product is available from 6 July to 31 December 2020.
Carmel Sepuloni adds that MSD has a number of ways, and products, to help people with their housing costs and there may also be other assistance available for renters such as the Accommodation Supplement.
Associate Housing Minister, Kris Faafoi said that under Alert Level 1 restrictions on movement and gatherings have lifted, and it was no longer necessary or justified to extend the restrictions on tenancy terminations after 25 June 2020.
“This means the usual termination rules will apply from 26 June 2020.
“The termination restrictions helped to protect public health and sustain tenancies to the greatest extent possible. They supported tenants to self-isolate and maintain physical distancing in order to stop the spread of COVID-19.”
He added that the Government recognised there were still challenging times ahead for landlords and tenants as a result of the economic impacts of COVID-19.
“We took unprecedented measures to protect public safety, and the economic impact of COVID-19 is still unfolding. We know it is likely to affect the ability of some tenants to meet their rental obligations, with flow-on financial effects for landlords.
“While we’re ending the period of increased protections against tenancy terminations, the increased rent arrears assistance is aimed at helping both tenants and landlords while they work through any rent issues,” Kris Faafoi concluded.
The two temporary changes to Rent Arrears Assistance are:
• Increasing the current maximum amount payable from $2,000 to $4,000 in a 52-week period. The increase in the maximum amount of rent arrears assistance over a 52 week period has been calculated around the current median rent across New Zealand and the duration of time households have spent in lockdown under Alert Level 3 and 4.
• Make Rent Arrears Assistance more accessible. Making Rent Arrears Assistance the primary rent arrears assistance product for anyone that presents to MSD with a need will make it easier for people to access and streamline the operational process.
The changes to the Rent Arrears Assistance Housing Support Product have been made for the period 6 July 2020 to 31 December 2020. After that the original policy will again apply.
This payment is recoverable so needs to be paid back. MSD will set the rate of recovery taking into account individuals’ circumstances.
Rent reductions or deferrals can be negotiated at any time between a landlord and tenant. However, the rent increase freeze remains in place up until and including 25 September 2020.
The Residential Tenancies Act allows parties to a tenancy to agree that the tenant can temporarily pay a lower rent. This could be for a specific time period or until a specific event occurs. Once that time is up, the rent is reinstated at its earlier amount. This does not count as a rent increase and is therefore acceptable during the six-month freeze period.
There is support for tenants who need to discuss rent issues with their landlords through groups like Citizens Advice Bureau and Community Law.