A common issue raised during the separation and property division process in nz is “occupational rent”. This can be claimed when one partner stays living in the family home, and the other person moves out.

The traditional concept of occupational rent is a notional amount payable by the person living in the home, to compensate the person who moved out.  It is usually calculated as a half-share of a market rental figure, supported by evidence from a rental agent or registered valuer.

The basis for it is found in section 18B of the Property (Relationships) Act 1976, which gives the court the power to compensate parties for post-separation contributions. “Contributions” can be financial or non-financial. Though there is case law establishing that where one partner makes their share of the family home available for the other to live in, this counts as a contribution which can be compensated for.

It is important to note that this compensatory claim is not something that can be counted on as “due and owing” from the moment the person moves out. It is a discretionary power of the court, which means that they can grant it if they consider it is fair and just in the wider circumstances.


Common factors that are taken into account are:

  • Each person’s financial circumstances, including accommodation costs of the non-occupying party;
  • Whether the occupying party is continuing to care for any children of the relationship;
  • Any delays – both in the occupying party progressing a division of relationship property, and the non-occupying party making a claim;
  • Whether the property was capable of being rented out on the open market;
  • Whether the outgoings paid by the occupying party exceed or approximately balance the sum for which the property could be rented; and
  • Whether there has been any increase or decrease in value of the property since separation.


An alternative claim that can be made is for “use of money interest”. That is, interest on a person’s share of the equity, which can be ordered if the court thinks it is fair and just to do so. There is a prescribed rate of interest, although the Family Court has a wide discretion to determine the amount payable.

If the home is owned by a family trust or company, the legal position can be quite different.

Which type of claim is appropriate will depend on the particular facts of a case. It is important to get early legal advice in the context of a separation, to best protect your position.


For More Information

Speak to one of JB Morrison’s Rotorua & Wellington family law experts about occupational rent in NZ or the separation property division process.

Request A Consultation   JB Morrison Family Law

 Our Rotorua family law experts:

Our Wellington family law experts:

  • Debbie Dunbar | debbie.dunbar@jbmorrison.com

See more of our family law articles here.


property division process is “occupational rent”.