24 Nov 2008

Landlords more active in collecting rent

3:58 pm on 24 November 2008

Landlords are becoming more active in collecting rent arrears the property market slowdown.

The Department of Building and Housing says Tenancy Tribunal applications have increased by 16% in recent months, with most of them relating to rent arrears.

According to the Property Investors' Federation, the number of properties available to let has increased by 13% in the last three weeks, creating a very soft rental market.

Vice president Andrew King believes this is because people who have been unable to sell their houses are now trying to rent them instead.

He said many landlords are struggle with high interest rates, high costs, and limited cash flow, so they are more inclined to take tenants to the tribunal.

Mr King said that in the economic downturn its likely that some tenants have lost jobs and are struggling to pay their rent.

Christchurch tenants protection association co-ordinator Helen Gatonyi said it has become harder to rent out properties at both ends of the market, which led many landlords to tighten their belts and become more vigilant in collecting rent.

She said although poverty is a reason behind rent arrears, being poor is not an excuse to get into debt.

Federation of Family Budgeting Services chief executive Raewyn Fox agrees, but said some families do not have a choice.

She said people who are struggling should seek independent budgeting advice.