New tenancy laws coming into effect Feb 11 2021

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#280715 5-Jan-2021 22:48

https://www.tenancy.govt.nz/law-changes/

Security of rental tenure – Landlords will not be able to end a periodic tenancy without cause by providing 90 days’ notice. New termination grounds will be available to landlords under a periodic tenancy and the required notice periods will change.

Changes for fixed-term tenancies – All fixed-term tenancy agreements will convert to periodic tenancies at the end of the fixed term unless the parties agree otherwise, the tenant gives a 28-day notice, or the landlord gives notice in accordance with the termination grounds for periodic tenancies.

Making minor changes – Tenants can ask to make changes to the property and landlords must not decline if the change is minor. Landlords must respond to a tenant’s request to make a change within 21 days.

Prohibitions on rental bidding – Rental properties cannot be advertised without a rental price listed, and landlords cannot invite or encourage tenants to bid on the rental (pay more than the advertised rent amount).

Fibre broadband – Tenants can request to install fibre broadband, and landlords must agree if it can be installed at no cost to them, unless specific exemptions apply.

Privacy and access to justice – A suppression order can remove names and identifying details from published Tenancy Tribunal decisions if a party who has applied for a suppression order is wholly or substantially successful, or if this is in the interests of the parties and the public interest.

Assignment of tenancies – All requests to assign a tenancy must be considered. Landlords cannot decline unreasonably. If a residential tenancy agreement prohibits assignment, it is of no effect.

Involuntary autocorrect in operation on mobile device. Apologies in advance.

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#2630862 5-Jan-2021 23:09

Fortunately all but 1 of my properties are rented out to our Kids, and the 1 remaining is to a long term tenant.

The kids should be in them for a few years unless they shift town for employment .

This will give is time to look at how this new regime will pan out, it may be worth leaving them empty.

In the mean time they all meet the new healthy home standards, but I am doing upgrades anyway so if we sell and exit the market we will get a good price.

We may consider an apartment in Surfers Paradise.

mattwnz

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#2630875 6-Jan-2021 02:24

sir1963:

This will give is time to look at how this new regime will pan out, it may be worth leaving them empty.

This is already occurring. Ghost houses, where people are then relying on capital gains. Already there are people who would prefer to leave them empty, than having to deal with a hassles of renting them out, for little return compared to the capital gains. But this then reduces NZs building stock and supply, and we don't have the resources to build enough new homes as it is, especially with our record immigration numbers pre covid, which I imagine will return to record numbers in a few years.

But leaving them empty only works though if capital gains continue on their current trajectory. But nothing much is being done to stop this trajectory.

If I owned multiple properties, at the moment I would certainly consider just leaving them empty. Especially if these new rules are going to cause problems. I wouldn't be too happy if I had built a new house, then rented it out, and then the tenants wanted to paint rooms or do other minor changes which could mean screwing things into walls etc. Although they have to restore things back to how they were, doing this up to the high standard of a new build wouldn't be easy, as many would probably be DIYing it. It is why many rentals are pretty tired and run down, because landlords don't want to rent out a house and risk tenants that don't take good care of things. It is why many would prefer to rent out to family, who you know will look after the place.

IMO NZ needs a ghost house tax, and to make sure our housing stock is all used, unless there is good reason for a house to be empty. . IMO we need more people with rentals exiting the market, to then allow people who are renting and are locked out of buying, the ability to buy. We need to increase the number of people who own, as our home ownership rate percentage is at historic lows. Although I heard one NZ property expert disputing this.

I think some of these changes look good though, and more fair for renters. But I would also like to see changes made to real estate agents, so the rules are more fair to prospective buyers. At the moment, I think it is all too geared towards sellers. As an example, at the moment, potential buyers may have to pay a lot for due diligence before an auction, for property inspections, LIMs, BIMs etc, only to waste all that money and time if they don't win the auction. This is a common complaint I hear.

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#2630876 6-Jan-2021 06:44

The law changes are already having catastrophic consequences for many lower socioeconomic households. I caught up somebody I know who was a property manager recently who already had several examples of people who have already got rid of tenants as a direct consequence of this law change. The risk of having problematic tenants in a property that they could not get rid of simply outweighed the short term risk of having an empty property or it taking some time to find tenants they wanted.

The real problem for these people is that they may then struggle to get other properties and simply up on the bottom of social housing waitlist that has already tripled in the past 3 years.

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#2630937 6-Jan-2021 08:46

Although I can sympathize with landlords who do end up with problematic tenants, these changes seem overall good to me.

Given that we're inevitably moving towards a situation where many people will be lifelong renters (even though they may not want to be), it's absolutely necessary that we enable renters to feel they have a "home" and not just a "house", if that's what they want.

New Zealand has a multitude of problems with its housing situation and I (as a homeowner) would fully support even fairly drastic measures to correct it.

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#2631045 6-Jan-2021 09:48

I think it's interesting as a non-renter and non-rental-owner, that the divide between landlords and tenants is often made wider through the loud voices of the minority bad tenants and the minority of bad landlords - resulting in legislation that always ends up alienating one side or the other...

As a tenant, I'd want some comfort in knowing I can't just be chucked out on a whim - it is, after all, my home. As a landlord, I'd want assurances that my property is going to remain free from damage and when vacated, is left as it was found.

The idea that people can make minor changes without consent makes sense, to a point...hanging pictures, painting walls etc. BUT - how prescriptive is it? And what are the specifics of taking it back to how it was before you moved in, when you vacate? My guess would be that it's deliberately vague, so that both parties have some "grey area" in which to roam.

I simply don't like the idea of being a landlord - I love the idea of having a property that will increase in value that I don't really have to pay for, due to the mortgage being covered by rent (but hate the idea of covering an additional mortgage if the property is untenanted).

I like my things to be my things, too...so the idea of people being able to change stuff that is mine - being able to get away with damaging stuff that is mine and having more protections than ever before - really doesn't sit well with me...hence I would be a terrible landlord and am not cut out to own rental property.

When I was a renter, I treated the property as my home - not someone else's stuff that I was envious of, or disdainful of. I don't understand the mindset of bad tenants, but I guess that's all in how we are brought up.

Anyway...it's a moot point, because i don't intend to be a landlord any time soon...despite the potential monetary benefits of owning multiple properties.

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#2631054 6-Jan-2021 10:25

I feel very lucky we currently have a good tenant. Previous tenants have been a nightmare (including family) renting out directly and through an agency. The house sat unoccupied for a long time whilst we decided whether we would continue trying to find a decent tenant for an older house. The rental income was not the issue as we were not demanding a top price but the fear of another tenant abusing and trashing the house because it was affordable.

I am sure the new rules will benefit certain people and there are abusers on both sides of the fence. Where there are fair tenants and fair landlords the rules may seem very fair because they almost become irrelevant. When one of the parties plays the system, it can create a nightmare that produces more rules and regulations that can make life harder for both sides.

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#2631068 6-Jan-2021 11:06

sbiddle:

The law changes are already having catastrophic consequences for many lower socioeconomic households. I caught up somebody I know who was a property manager recently who already had several examples of people who have already got rid of tenants as a direct consequence of this law change. The risk of having problematic tenants in a property that they could not get rid of simply outweighed the short term risk of having an empty property or it taking some time to find tenants they wanted.

The real problem for these people is that they may then struggle to get other properties and simply up on the bottom of social housing waitlist that has already tripled in the past 3 years.

It will certainly be interesting to see how many high risk tenants get tossed out over the next month, including my former neighbours whose behaviour forced me to move in late 2019.

It interests me that evictions will require landlords to gather evidence of three incidents of anti-social behaviour, and tenants who assault their landlord can be kicked out with 14 days notice. The problem with this is that, in practice, it will probably be mainly neighbours who be end up having to gather that evidence so they will be the ones getting assaulted. Where's the protection for them?

alasta

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#2631070 6-Jan-2021 11:10

compound:

I feel very lucky we currently have a good tenant. Previous tenants have been a nightmare (including family) renting out directly and through an agency. The house sat unoccupied for a long time whilst we decided whether we would continue trying to find a decent tenant for an older house. The rental income was not the issue as we were not demanding a top price but the fear of another tenant abusing and trashing the house because it was affordable.

I have no desire to become a landlord but, if I did, I would probably want to have a one or two bedroom apartment/townhouse at the higher end of the market because these types of properties tend to attract mature professionals.

Of course that doesn't guarantee that you're going to get a good tenant, but from what I've seen most of the problems seem to affect low end 3 or 4 bedroom houses where you tend to get young people house sharing and the occupants often encourage each other's bad behaviour. For that type of property it probably makes economic sense to leave it empty if you can't find a mature tenant with impeccable history.

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#2631071 6-Jan-2021 11:11

alasta:

It interests me that evictions will require landlords to gather evidence of three incidents of anti-social behaviour, and tenants who assault their landlord can be kicked out with 14 days notice. The problem with this is that, in practice, it will probably be mainly neighbours who be end up having to gather that evidence so they will be the ones getting assaulted. Where's the protection for them?

Good news! We already have laws against assault.

If a neighbor is collecting that sort of evidence, surely it'd just be video from afar, or have you been in a situation requiring actual confrontation? Genuine question.

mkissin

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#2631074 6-Jan-2021 11:15

alasta:

Of course that doesn't guarantee that you're going to get a good tenant, but from what I've seen most of the problems seem to affect low end 3 or 4 bedroom houses where you tend to get young people house sharing and the occupants often encourage each other's bad behaviour. For that type of property it probably makes economic sense to leave it empty if you can't find a mature tenant with impeccable history.

I'm not sure you can even generalise that much. A house across the road from us (4 bedroom) is apparently rented for over $1000 a week. That's pretty nuts, and makes it more likely that a group of individuals will end up renting individual rooms.

alasta

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#2631085 6-Jan-2021 11:26

mkissin:

alasta:

It interests me that evictions will require landlords to gather evidence of three incidents of anti-social behaviour, and tenants who assault their landlord can be kicked out with 14 days notice. The problem with this is that, in practice, it will probably be mainly neighbours who be end up having to gather that evidence so they will be the ones getting assaulted. Where's the protection for them?

Good news! We already have laws against assault.

If a neighbor is collecting that sort of evidence, surely it'd just be video from afar, or have you been in a situation requiring actual confrontation? Genuine question.

My initial approach was to call noise control knowing that would give me a paper trail of evidence, however I was reluctant to keep doing that repeatedly because I felt guilty about the burden that I was putting on the council's resourcing. Video recordings were an option I considered as a next step but in order for it to be definitive proof I would have to have got quite close to their unit so I felt it was quite possible that they would notice me and a violent confrontation could result. It didn't help that I lived alone and there was always at least half a dozen of them (and sometimes more than a dozen) on the property at any given time.

In the end it was less stress to just give up and move out.

Interestingly I have noticed that the unit that I lived in has been left vacant, so I guess the property managers took on board my feedback that it's not fit for occupation while the problem tenants are still in the neighbouring unit. Why they haven't been kicked out yet is a mystery to me, but it will be interesting to see what happens this month given the upcoming law changes.

mkissin

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#2631086 6-Jan-2021 11:33

alasta:

My initial approach was to call noise control knowing that would give me a paper trail of evidence, however I was reluctant to keep doing that repeatedly because I felt guilty about the burden that I was putting on the council's resourcing. Video recordings were an option I considered as a next step but in order for it to be definitive proof I would have to have got quite close to their unit so I felt it was quite possible that they would notice me and a violent confrontation could result. It didn't help that I lived alone and there was always at least half a dozen of them (and sometimes more than a dozen) on the property at any given time.

In the end it was less stress to just give up and move out.

Interestingly I have noticed that the unit that I lived in has been left vacant, so I guess the property managers took on board my feedback that it's not fit for occupation while the problem tenants are still in the neighbouring unit. Why they haven't been kicked out yet is a mystery to me, but it will be interesting to see what happens this month given the upcoming law changes.

That's fair. You probably shouldn't feel bad about calling in authorities when needed though. That's what they're there for, and your rates (possibly indirectly) are paying for them.

Still, I do think that it probably should be hard-ish to kick people out of their homes. The situation would have been entirely different had they owned that place, which makes the whole thing a weird power-imbalance that I'm not 100% comfortable with.

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#2631106 6-Jan-2021 12:33

As a tenant these rules for the most part seem to be common sense, the sort of thing a good landlord already offers up.

for those trying to get rid of a bad tenant though, this does seem to make it harder...

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sir1963

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#2631108 6-Jan-2021 12:35

alasta:

sbiddle:

The law changes are already having catastrophic consequences for many lower socioeconomic households. I caught up somebody I know who was a property manager recently who already had several examples of people who have already got rid of tenants as a direct consequence of this law change. The risk of having problematic tenants in a property that they could not get rid of simply outweighed the short term risk of having an empty property or it taking some time to find tenants they wanted.

The real problem for these people is that they may then struggle to get other properties and simply up on the bottom of social housing waitlist that has already tripled in the past 3 years.

It will certainly be interesting to see how many high risk tenants get tossed out over the next month, including my former neighbours whose behaviour forced me to move in late 2019.

It interests me that evictions will require landlords to gather evidence of three incidents of anti-social behaviour, and tenants who assault their landlord can be kicked out with 14 days notice. The problem with this is that, in practice, it will probably be mainly neighbours who be end up having to gather that evidence so they will be the ones getting assaulted. Where's the protection for them?

"The landlord may apply to the Tenancy Tribunal to end a periodic tenancy if:

the landlord has issued a tenant three notices for separate anti-social acts within any 90-day period; or

the landlord has given notice that a tenant has been at least five working days late with their rent payment on three separate occasions within a 90-day period."

" A landlord will be able to issue a 14-day notice to terminate the tenancy if the tenant has assaulted the landlord, the owner, a member of their family, or the landlord’s agent, and the Police have laid a charge against the tenant in respect of the assault."

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#2631113 6-Jan-2021 12:49

sir1963:

the landlord has given notice that a tenant has been at least five working days late with their rent payment on three separate occasions within a 90-day period."

Good grief, this one could continue on and off indefinitely. And I'd say it will happen fairly often, not because of any malicious intent, just some people just have drama after drama.

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