A NZ Property Investors Federation (NZPIF) survey has found that rental property owners are affected by the Covid-19 situation just like tenants and other New Zealanders”, said Sharon Cullwick, Executive Officer.
“A little-known fact is that New Zealand rental property providers do not own vast numbers of properties. The average number is less than two, with 90% of providers owning just one or two rentals to help them through retirement,” she said
A vast majority of rental providers have a main source of income that isn’t rent. However, the NZPIF study found that 59% of providers have lost either part or all of their main income.
Of those that have had their income affected, 46% have had some loss of income, 33% have lost all their income but have received some government assistance, and 21% have lost all their income and have not received any assistance.
The survey shows that Government initiatives, through income supplements and fast-tracking welfare assistance, have helped to keep tenants in their homes.
However, 6% of tenants left their rental property as soon as lockdown began and a further 2% have stopped paying rent with no warning.
Landlords have reduced the rent for 5% of their tenancies and deferred rental payments for a further 1.5%.
For landlords who have lowered the rent, the average reduction was 43% or $210 per week.
Expenses, such as rates, insurance, repairs etc account for 30% to 50% of rental income before mortgage payments are even taken into account. Many landlords simply cannot afford not to have rent coming in.
The Covid-19 situation is the fault of neither tenants or landlords. All will be affected in different ways and the NZPIF recommends good and honest communication to keep people in their homes.