Guidance for rent negotiation discussions

Work and Income also have rent support available if you meet certain criteria. (external link)

Legislation changes affecting rent increases

From 12 August 2020, rent increases are limited to once every 12 months. This is a change from once every 180 days (six months).

Any rent increase notices given to tenants from 12 August 2020 must comply with the new 12-month rule. If a notice was given before 12 August 2020, it is still within the 180-day rule.

Rent increases

For both fixed-term and periodic tenancies, landlords can only increase rent:

• 12 months after the date the tenancy started

• provided the increase is not within 12 months from when the last increase took effect.

Landlords must give the correct notice and meet certain conditions.

For fixed-term tenancies, landlords can only increase rent if the tenancy agreement allows this.

Special rules apply if a tenancy agreement is subject to an annual rent increase process.

Landlords must give notice to increase rent

A landlord must give their tenant at least 60 days’ written notice of a rent increase. Boarding house landlords must give their tenant at least 28 days’ written notice.

Notice can be given in advance of the 12 month period, however the rent increase can only take effect 12 months after the date the last rent increase took effect and 12 months after the date the tenancy started.

 The notice must be served in writing, say how much the rent is increasing to and the day the increased rent is due. The landlord should keep a copy of the notice. If the landlord doesn’t give the correct notice they can:

• serve it again correctly
• ask the tenant to let them extend the notice time so it is correct, or
• apply to the Tenancy Tribunal to extend the notice, if the tenant won't allow the landlord to extend it.

Serving notices

Download our notice of rent increase templates below.

Landlords decide how much to increase the rent

The law doesn’t limit how much landlords can increase rent by. It does say how it must be done, and what the tenant can do if they don’t agree with the new rent amount.

Rent increases can be agreed in some circumstances

A landlord and tenant can also agree to an increase in rent outside the 12 month period if the landlord has done one of the following:

• Substantially improved the property, which increases its value and benefits the tenant (not being general or necessary repairs). For example, adding a garage to the property that the tenants want for storage and off street parking.
• Improved facilities or services for the tenant (not being general or necessary repairs). For example, an apartment building has a new pool facility available for tenant use.
• Changed the tenancy agreement to benefit the tenant. For example allowed pets.

A landlord may apply to the Tenancy Tribunal to increase the rent if:

• the tenant doesn’t agree to increase the rent (and the landlord has improved the property (not being general or necessary repairs) or changed the tenancy agreement to benefit the tenant).
• the landlord has had unforeseen expenses since the rent was last increased.

If the Tenancy Tribunal increases the rent for these reasons, this doesn’t change the normal date the rent is reviewed or increased.

Landlords and tenants should keep in contact and discuss any possible changes to the rent.

Landlords can also increase the bond

When a landlord increases the rent, they can ask the tenant to pay extra bond money. This must be based on the number of weeks’ bond charged in the tenancy agreement.

Landlords should request the extra bond payment at the time that they issue the rent increase notice. You can only request the extra bond payment for a current rent increase. The extra bond payment can’t cover previous rent increases where an extra bond was not requested at the time.

Tenants should pay the extra bond amount to the landlord when the rent increase takes effect. This must be lodged with Tenancy Bond Services within 23 working days.

Adding to an existing bond

Rent reductions

The rent can also be reduced in certain situations.

For a specified period or event

A landlord and a tenant may agree to a temporary reduction of the rent for a set period. For example, if a room is being repaired and can’t be used for a while.

Once the period has ended or the work has finished, the rent goes back to the original amount. This is not a rent increase and doesn’t need notice.

If the rent is too high

If a landlord is charging a lot more than is being charged for similar properties in the area, the tenant can apply to the Tenancy Tribunal. The Tribunal could make an order for the rent to be reduced. The tenant will need to have evidence that their rent is a lot higher than rent for similar houses in the same area.

If you have a fixed-term tenancy, you can only apply to the Tenancy Tribunal for a market rent review within:

• 3 months of the beginning of the tenancy, or
• 3 months of the date of the last rent review.

Market rent

Making an application to the Tenancy Tribunal