Rent is the main charge that tenants have to pay on a regular basis. The level of rent and the method of rent payment should be agreed upon before the tenancy begins. Both should be written into the tenancy agreement in the spaces provided. Rent payments are GST free. The method of rent payment cannot be changed during the agreement period unless the tenant agrees.

Rent receipts

Receipts must always be given if the rent is paid in person.
Receipts for rent must show:

• the address of the premises
• the name of the tenant
• the name of the landlord or agent
• the amount of rent paid
• the date the rent was paid
• the period of time which the rent covers.

If rent is posted, a receipt must still be filled out and either sent back to the tenant, or kept until the tenant wants to collect it. If the rent is paid into a bank account, no rent receipt need be given.

The landlord or agent must keep copies of all rent receipts and a separate rent record for at least 12 months. It is advisable that receipts be kept by both parties until after the end of the tenancy.

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Electronic rent payments

A landlord cannot pass on the cost of providing a payment card or deposit book to the tenant for paying rent at a post office or bank.

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Use of collection agents to collect rent

A collection agent is a person or organisation who collects rent on behalf of an agent who is managing the property for the owner.

If a tenant agrees to pay their rent through a collection agent, they then enter into a contract with the collection agent. The collection agent may charge a fee for this service, and if there are direct debits from a tenant's bank account for rent payment, then bank fees may be charged. Tenants must also be aware that the collection agent and the bank can charge additional fees if there are insufficient funds in the bank account at the time the collection agent attempts to debit their account. Before agreeing to use the services of a collection agent, tenants must ensure they read and understand the terms of the contract.

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How can rent be increased?

Rent may be increased after the fixed term period of the agreement has expired. Before a landlord (other than the Department of Housing) can increase the rent the tenant must be given at least 60 days notice in writing. The notice must show the amount of the increased rent and the day from which the increased rent is to be paid. This also applies where an existing agreement is to be renewed.

If the notice is sent by post at least four working days should be added to the amount of notice, to allow time for the notice to be delivered.

For rent to increase during a fixed term tenancy the agreement must have an additional term showing the amount of the increase or the method of calculating it. A 60 days rent increase notice must still be given.

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Challenging rent increases

If a tenant thinks that a proposed rent increase is too high they can:

1. Negotiate
Even though the landlord or agent has given notice they may still agree to reduce the amount of the increase or withdraw it altogether. They may be persuaded by evidence of market rents in your area or what you have done to the premises. You should carefully explain the reasons why you believe the increase is too high in a letter to the landlord.

If the condition of the premises is the reason you think the increase is too high you should raise this with the agent or landlord. For instance, they may be prepared to paint the premises in exchange for the rent increasing. It is up to the landlord to consider the costs involved in any such proposal.

If the landlord agrees on a lower amount of increase this should be put in writing. Another 60 days notice is not necessary. The lower increase becomes due from the same date the original increase was payable.

2. Apply to the Consumer, Trader and Tenancy Tribunal
Tenants can apply to the Tribunal to have a proposed increase reduced or withdrawn, if they believe that the increase is too high. Department of Housing tenants receiving a rent rebate cannot do this.

Applications must be made within 30 days of receiving the rent increase notice. Tenants have to prove that the increase is excessive. The main evidence the Tribunal considers is comparable rents for similar properties in the same area.

Before you apply to the Tribunal you may wish to visit estate agents in your area and gather evidence of the current market rent for properties similar to your own. It is often worthwhile to view the available premises to make sure they are similar (eg size, location, view etc).

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