How the lockdown is affecting landlords
Friday 3 April 2020
It’s not just tenants who are feeling the impact of the Covid-19 lockdown – residential landlords are too, with a new survey showing that the personal income of 59% of them has been affected.
By The Landlord
The NZ Property Investors Federation (NZPIF) has just run a survey* to gauge the effects of the lockdown on rental property owners and the results show that, just like everyone else, landlords are experiencing a loss in income.
In terms of the personal incomes of landlords, 41% have not been affected by the lockdown position.
But 59% have lost all or some of their regular income from jobs, contracts or business.
Of those that have had their income affected, 47% 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.
While a majority of respondents are financially secure for the moment, 21% will need assistance if the lock down continues for more than a month and 5% need assistance now.
NZPIF executive officer Sharon Cullwick says the survey results disprove the assumption that anyone who owns a rental property is rich and tenants should be allowed to stop paying their rent.
Private individuals provide 85% of rental properties in New Zealand, she says.
“Most of these people do have other jobs or businesses that are their main source of income, but there are also those who rely on their rental income to put food on the table to feed their own families.”
While the survey results show that over half of landlords’ have seen their personal income affected by the lockdown, they also suggest Government initiatives, like income supplements and fast-tracking welfare assistance, are helping to keep tenants in their homes.
According to the survey, the majority of tenancies (81%) have not experienced any change.
However, 6% of tenants have left their rental property and a further 2% have stopped paying rent.
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.
For the 166 landlords who have lost rental income, the average amount lost after only one week in lockdown is $1,059.
Cullwick says that rental property providers are ordinary New Zealanders who are sharing in the loss of income like other sectors of society.
“Many will be part of the front-line staff serving our communities so well through this crisis. We are all in this together and landlords are doing what we can.”
As the NZPIF is keen to know the ongoing effect of the Covid-19 regulations on the rental market, they will be conducting the survey weekly, she adds.
*The NZPIF survey involved rental property owners and property managers. There were 621 respondents who, between them, manage 6,056 rental properties.
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