Too cool for comfort?

Funding intended to boost New Zealand’s supply of warm, dry rental properties is not all it’s cracked up to be, according to two very different sources.

Friday, May 27th 2016, 12:00AM 2 Comments

by Miriam Bell

There has been months of public concern about the cold, damp housing conditions many lower-income New Zealanders live in.

At the same time, there has been growing pressure for the introduction of minimum standards for rental properties.

In response, finance minister Bill English allotted $36 million to “ensure more New Zealand families live in warmer, drier and healthier homes” in Budget 2016.

The funding is to be delivered in two separate packages. There will be:

• $18 million, over two years, to extend the Warm Up New Zealand programme to insulate rental houses occupied by low-income tenants, particularly those with high health needs.

• $18 million, over four years, to expand the Healthy Homes Initiative* to reduce preventable illnesses among young children who are living in cold, damp and unhealthy homes.

Energy and resources minister Simon Bridges said the extended Warm Up New Zealand programme should see an additional 20,000 houses insulated and will target those most in need.

The government’s investment will be matched by funding from trusts and other third parties, he said.

“The programme provides incentives for landlords to insulate, including 50% financial assistance, to support them in meeting requirements of the Residential Tenancies Act.”

Both these initiatives are intended to complement the government's Residential Tenancies Amendment Bill which requires all rental properties to be insulated by 1 July 2019.

NZ Property Investors’ Federation executive officer Andrew King welcomed the new funding for both initiatives.

However, he said the Warm Up New Zealand programme should cover the entire cost of insulation for vulnerable tenants, not just 50%.

“The programme makes the insulation cost so high that even a 50% subsidy makes it an expensive exercise which will see rents increase for families living in these houses.

“This means that there is less money available in the tenant’s budget to actually turn their heating on.”

King said it would have been better if insulation and energy efficient heaters had been made tax deductible expenses.

“This would have improved rental properties and minimised the required rental increases for all tenants.

“It is the increasing cost of providing rentals, not the desire to make large profits, which is driving up rents.”

The Green Party also criticised the government for not providing more home insulation funding.

Green Party energy spokesperson Gareth Hughes said Budget 2016 actually cut home insulation funding to its lowest ever level.

For example, in comparison last year’s Budget allocated $23.9 million for home insulation.

Hughes said the government seemed to be giving up on warming up New Zealand’s houses – even though the country has some of the coldest, draughtiest, dampest houses in the developed world.

“No New Zealander should have to live in a cold, damp, draughty house that makes them sick.

“Yet fifteen children die every year and 42,000 child are hospitalised because of illnesses from cold, damp, mouldy housing.”

*The Healthy Homes Initiative provides families with insulation, curtains, heating, beds, maintenance and repairs, and advice on ventilation, mould removal and sleeping arrangements for children.

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Comments from our readers

On 28 May 2016 at 11:35 am jpaynter said:
I have three tenancies with "low income tenants". They should have be able to qualify for a subsidy, however one (on ACC only) says her income is too high. One other has medical conditions and the third has young children. However the 2nd has not yet been to the Dr to complete the paperwork and the last keeps losing her Community Services Card (in the meantime the trust providing the insulation in that area ran out of funds). I have insulated the ceilings where I can (a long time ago, and have since upgraded them again where I can - some have skillion ceilings that cannot be accessed). So I onl have the underfloor insulation to do. Another tenancy does not want me to do it as the occupants (of 17 years) do not think it an issue. Seems none want to cooperate, perhaps as they consider it will increase the rent).
Note that all these properties are better than the one I was brought up in and my 93 year old Dad still lives in. He does not want me to go to the fuss of installing underfloor insulation for him.
I think the value of providing insulation is overstated the providers of the subsidised services inflate the price above which I can do it myself. Personally providing a source of heat is probably more important, but electricity prices are rising. I provided dehumifiers (if you shut up the place and insulate it you keep in more moisture) but the tenants complain of the costs of running them.
Seems that landlords cannot win whatever they do.
On 28 May 2016 at 6:41 pm jpaynter said:
I have three tenancies with "low income tenants". They should have be able to qualify for a subsidy, however one (on ACC only) says her income is too high. One other has medical conditions and the third has young children. However the 2nd has not yet been to the Dr to complete the paperwork and the last keeps losing her Community Services Card (in the meantime the trust providing the insulation in that area ran out of funds). I have insulated the ceilings where I can (a long time ago, and have since upgraded them again where I can - some have skillion ceilings that cannot be accessed). So I onl have the underfloor insulation to do. Another tenancy does not want me to do it as the occupants (of 17 years) do not think it an issue. Seems none want to cooperate, perhaps as they consider it will increase the rent).
Note that all these properties are better than the one I was brought up in and my 93 year old Dad still lives in. He does not want me to go to the fuss of installing underfloor insulation for him.
I think the value of providing insulation is overstated and the providers of the subsidised services inflate the price above which I can do it myself. Personally I think providing a source of heat is probably more important, but electricity prices are rising. I provided dehumifiers (if you shut up the place and insulate it you keep in more moisture) but the tenants complain of the costs of running them.
Seems that landlords cannot win whatever they do.

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