Fixed on Change. Why Tenancy Reform will Benefit New Zealand
19th of September, 2018
I have to agree with David Faulkner in his article below. The majority of the upcoming changes to the Residential Tenancies Act, the Healthy Homes Legislation and the requirements for heating and ventilation are all well overdue in our rental market. Some landlords are simply going to have to bite the bullet and improve their properties. The fact is that our history does not cater for longer-term tenancies in the way that overseas regimes do. In NZ, we are simply being seen to 'grow-up' in international terms. As the dream of everyone having the 'quarter-acre, half-gallon, pavlova paradise' diminishes, I have long felt that there will be a day when our popularity will grow to the point where we become more like Europe, UK, and the US where prices of property simply out strips the ability for many to buy them. Having grown up watching the likes of "Friends" and 'Coro St' we should know that home ownership is never a given in a mature population. This is a bitter pill for us as a young nation to swallow. However, the day has come when moves need to be taken to accommodate the longer-term tenant and the protection of same. In parts of Eastern Europe the tenant arrives to no kitchen or bathroom and their contribution, ( and no doubt care thereof, ) comes down to them providing these utilities and then to treat the whole premises as their own for ten years plus or even for life, changing the utilities as they see fit.
Pending changes don't go this far but certainly there are moves to accommodate those who find themselves at the mercy of their landlord's whim yet no ability to avoid the rent trap. Personally I favour a two-prong approach. Firstly with the idea of providing the commercially similar leasing of an empty space for the tenant to 'fitout' to suit themselves for the long-term and secondly, something similar to the present 12 month-lease regime incorporating the pending changes.
As mentioned before, the only part of these pending changes that has had no thought nor investigation into it is the banning of letting fees. Without these fees, larger and more professionally set up PM firms will not have the ability to pay for a premises for tenants to come to for their services. Plainly the fees pay for the premises and equate to 11-20% of any particular PM company's income. Take that out of the turnover and the result will be less overseas and out-of town owners having the ability to own rental stock, meaning less stock for tenants to have available and higher rents. Very clever, I don't say.