Rental crisis: Would you pay $30,000 upfront to get a rental? Tenants’ desperate measures

A man who, after two months of rental rejections, offered to pay potential landlords $30,000 upfront.
A Rotorua couple so desperate for a rental they pay more than they can afford and “are broke all the time”.
A migrant family from South Africa trapped in Tauranga who fear they could be homeless soon.
A working mum with great references afraid she will end up in emergency housing after her landlord gave notice he had decided to move back in – forcing her out.
These are the stories of those stuck inside the Bay of Plenty’s grinding housing crisis. Carmen Hall reports

After two months of rental rejections, a Tauranga man offered potential landlords $30,000 upfront – and had six bites within an hour.

The former Wellingtonian, who did not want to be named, moved for work and put an ad on Trade Me for a house that he missed out on-it was taken down within an hour of being listed.

However, his offer attracted a flurry of replies from interested landlords.

“I said I’ll pay a year in advance: That is the power of cash.”

He had been holed up in motels while searching for a home.

“I was getting frustrated, it was a difficult time for me emotionally. Now I love my place, which is close to the beach.”

It is just one of the bold moves people are making as competition for homes heats up.

Others are facing heartbreak, homelessness, and financial hardship as the rental crisis deepens in the Bay of Plenty’s cities, Tauranga and Rotorua.

The latest data from Trade Me reveals median rents in Tauranga jumped $8140 between March 2016 and March 2021, or from $440 a week to $595.

In Rotorua, it increased by $9880, or from $300 to $490 a week, over the same period.

Throughout the Bay, the Government spent $2.9 million a week on accommodation supplements in the last quarter of the financial year.

Tauranga Rentals owner Dan Lusby said one of his landlords was offered six months in advance – $21,600 – and took it.

Some tenants were also offering more than the advertised rent and Lusby said it was the tightest he had ever seen the market.

“We’ve got three properties on our board at the moment and last month we only had three to rent. People are too scared to move and are staying put in case they can’t find anywhere else.”

Despondent tenants were also living in overcrowded houses.

'Always … broke'

Every week Renae Hapeta and her partner are broke.

However, the chef and concrete worker are grateful they’re not homeless or relying on and family and friends.

Hapeta, 21, said they struggled for two years to find a home in Rotorua.

“It was only because of a family friend that we are in a house right now but the search is tough. You apply for everything, and it seems our age and our dog didn’t suit what they were looking for.

“Then there were other situations when we were almost successful but then a desperate family would come along and get the house but we didn’t mind because homing a family is more important.”

She says their three-bedroom home was $420 a week and they had applied for hundreds of homes.

“We pay a lot for this house, it’s really expensive. Our choice is to keep this house and always be broke and just scraping by or continue the unsuccessful smaller house hunt or be homeless.”

A Tauranga mother of one, who asked not to be named as she feared it would embarrass her daughter, said she felt “demoralised” by her rental search.

She works full-time in the public sector and has great references but the clock is ticking: She has one month to find a new home before her landlord moves back in.

She pays $400 a week for the two-bedroom unit and has hopes of getting a four-bedroom home and possibly share with another single parent – those rents were likely to be $700 upwards.

“The prices are ridiculously high for what you get and it is incredibly hard to find a rental in Tauranga. My daughter and I are losing a lot of sleep and it’s very stressful.”

Her worst-case scenario would be moving into emergency or transitional housing.

“I refuse to live in a car with my child but I have seen people on Facebook who have been stuck in transitional housing for months or years.”

She also worried about exposing her daughter to family harm or drug and alcohol addiction scenarios in social housing.

'Even with good jobs it feels like we live week-to-week'

Patrizia Eleftheriou is worried about where her family of five will live after their landlord sells the home they are living in.

The South African says her husband is a carpenter and she works part-time as a cosmetic tattooist but it has been an uphill battle finding another rental.

The competition was fierce and when they did get to view a house 50 other people could be there.

“If you have a toddler or a pet you are the last one they are going to choose. I’m afraid we are not going to get anything.

“I think the hardest thing is we are going to have to take whatever we can get, which is unsettling for the children as they have moved from overseas.”

Eleftheriou was also shocked most rentals cost upwards of $600.

“Even with good jobs it feels like we live week to week and now the rentals are so much more than when arrived.

“It’s scary.”

Overcrowding is a growing issue as rental desperation grows, a property manager says.

Rotorua Rentals director Pauline Evans said in some instances it had approached the owner to see if the number of tenants on the tenancy agreement could be amended.

“Most situations can be sorted this way, some being a permanent fix, others have been given a short time limit, maybe a month or two, with the understanding that they must move out once the time has elapsed.”

Some prospective tenants had offered to pay more to have their pets at the property but negotiations along those lines were declined.

Evans said changes to theResidential Tenancies Act and other regulations had contributed to a “roller-coaster of a ride” for many in the industry.

“The flow-on effect of all of these changes is tenants have little to no choices when looking for rental accommodation. Some owners have already sold and moved on, with others still weighing up their options.”

Associate Minister for Housing Poto Williams said changes had been made to improve the security and rights of renters, including limiting rent increases to once a year and banning rental bidding.

“We are monitoring what happens with rent rises and will take action if necessary.”

Tenants could also go to the Tenancy Tribunal to request a rent reduction and it was unlawful for a landlord to ask the tenant to pay more than two weeks’ rent in advance.

Tenancy Compliance and Investigations national manager Steve Watson said the Residential Tenancies Act does not stop tenants from offering to pay more than two weeks’ rent in advance, as long as this wasn’t prompted by the landlord.

Housing crisis causes trauma, affects mental health

Salvation Army territorial director of community ministries Jono Bell said traditionally beneficiaries and low-income earners were the organisation’s primary clientele.

But that was changing.

The housing crisis was now “eating into middle-class NZ”.

“Whole portions of society are being traumatised by the homelessness situations they find themselves in.”

He said people with regular incomes were using creative measures to secure rental properties.

“Nobody wants to be homeless. It’s not an option for anyone especially if you have got children or you are caring for other family members.

“You have more than one family living in a home to bring up the income to support the rent. That leads to overcrowding and a whole lot of other issues.

“People are often then evicted or blacklisted.”

Heightened anxiety, lack of resilience, stress and sleeplessness were major concerns, he said.

“Now there are emerging mental health and emotional issues which are the direct result of the housing challenges people are facing. We are seeing all portions of society now presenting since Covid.”

Bell said the housing supply issue was not new and more houses needed to be built but he also questioned the amount of land banking happening around the country and believed that needed to be investigated.

“In Auckland alone, there are about 20,000 ghost houses.”

He said some investors were purchasing properties and closing the doors because they don’t want to deal with tenants and the new government regulations.

Bell also said rents were set by the market and landlords were within their rights to charge accordingly but there was also a moral consideration in the decision.

Tauranga Budget Advisory Service manager Shirley McCombe said rising rents were a major issue contributing to some children going without food and warm clothing, sleeping in cars and not attending school.

Debt was another problem, with clients’ total debt jumping from $36.9m in August to $45.6m last month, with more wage earners struggling.

A spokeswoman for Minister of Housing and Urban Development Megan Woods said Census 2018 data showing 200,000 empty homes nationwide, – 39,000 in the greater Auckland area – was likely overstated.

Baches and homes empty due to tenancy changeovers or renovations or just because the occupants were not there on Census night may have been caught up.

The Ministry of Business Innovation and Employment was working with the Electricity Authority to gather more data about the proportion of homes actually unoccupied.

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