Jacinda Ardern's message to landlords considering increasing rents

Prime Minister Jacinda Ardern has asked landlords who are considering increasing their living costs for tenants after rent freezes end to "have a level of fair mindedness".

The Government announced a six-month freeze on rent increases on March 26 to help protect tenants during the COVID-19 pandemic. But the Commerce Commission warned property investors last month they may be at-risk of cartel-like behaviour after they used online forums to discuss raising rents en masse on September 26 - the day after the rent freeze ends.

Due to legislation changes that came into effect from August 20, rent increases are limited to once every 12 months. Previously, increases were limited to once every 180 days.

"That's legislation we've brought forward in order to try and deal with any potential ongoing rent increases on a repetitive basis [that] otherwise under normal circumstances a tenant might've experienced," Ardern said on Tuesday.

But she said the Government hasn't looked at capping the size of rent increases.

"The Commerce Commission has been keeping an eye on whether or not they're seeing behaviour here that would not be in keeping with legislative obligations," she said.

"Ultimately, my message would be we are still needing to look after our team of five million. We do still want our landlords to be making sure that they have long-term tenants that are able to sustain their rents in a really difficult environment. So I would ask that there be a level of fair mindedness."

Commerce Commission chairperson Anna Rawlings told RNZ property investors who hold discussions about raising rents may breach the Commerce Act, and advisory letters had been sent to industry representatives..

She said landlords should be aware they can be in competition with each other for supplying rental properties and they can be carrying out a business while doing this.

"As a result, they are subject to the provisions of competition law and consumer protection laws. They should make sure they're aware of their obligations and ensure they comply with them."

Property Investors Federation executive officer Sharon Cullwick received a letter from the Commerce Commission, and said while investors were only discussing their possibilities on Facebook, she wants landlords to pay attention to the letters.

"It really is a warning to us that they are looking at what property investors are doing," she told RNZ.

Crockers Property Management chief executive Helen O'Sullivan said she isn't seeing many rent increase notices and doesn't expect to.

"Landlords are recognising that having a quality tenant that can pay the bills at the moment is very much the best way to maximise your income stream."

This article was amended on September 16 because it incorrectly stated that property investors who are considering hiking rents the day after the freeze ends may breach the Commerce Act.