About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds Other Sites:   tmmonline.nz  |   landlords.co.nz
Last Article Uploaded: Wednesday, December 12th, 11:30PM
rss
Latest Headlines

Rental WoF won't help affordability

The Green Party is again calling for the introduction of a rental Warrant of Fitness (WoF). But NZ Property Investors Federation executive officer Andrew King is questioning that call...

Sunday, September 9th 2018, 12:00PM 1 Comment

by The Landlord

NZPIF executive officer Andrew King

The Green Party has relaunched a campaign to introduce a rental property Warrant of Fitness.

“Private owners provide around 85% of rental properties in New Zealand. Do we really think that making it harder and more expensive to provide those rental properties is going to improve rental affordability and choice for tenants?” asks Andrew King, Executive Officer of the NZ Property Investors’ Federation (NZPIF).

The idea of a rental WOF was first proposed some 20 years ago and since then has continued to be rejected by successive Labour and National Governments every time it has been raised.

Previous WOFs have been based on various factors, such as disallowing properties over a certain age so that tenants can have newer homes.

The suggested WOF from Otago University is mostly reasonable, with most aspects already covered in existing legislation. Yet it still contains items such as a minimum size for kitchen benches, which many rentals will not be able to meet.

Before the WOF was even considered, Otago University had produced a paper with “improvements” to the WOF, one of which was correct orientation towards the sun. This is an unrealistic expectation likely to remove properties from the rental pool.

Some of these expectations are higher than the current building codes. This would indicate that the building codes are acceptable for owner occupiers but not good enough for tenants.

NZPIF is particularly concerned about the possibility of on going increases in the requirements contained in a rental WOF. Once as rental WOF is introduced, people are likely to be employed to continually “improve” it. 

This will inevitably add more costs to providing rental property and cause more and more properties to become unable to be rented. This will increase the cost of rent and also reduce the number of properties available for renters.

Some people believe this is a good thing, arguing that the property doesn’t disappear, it just gets bought by a home owner.

Unfortunately, rental properties are on average smaller than owner occupied properties yet they contain more people. This means that when a rental property is sold to an owner occupier there will be tenants looking for a rental property that no longer exists.

Additionally, many rental properties are owned by people moving overseas for one or two years. Rather than sell the property, they are more likely to leave it empty or rent it out on Airbnb.

It is patronising to tenants to say that they need to be told what their home should be like and that they cannot judge this for themselves.

Like all industries, customers end up paying more when the cost of a product or service increases. If they don’t, then supply of those goods and services reduces.

Rental prices have been increasing at a faster rate than inflation for the last eight or so years and will continue to do so if more unnecessary regulations and costs are applied without actually improving tenants lives.

« A different system: the rental market in ScandinaviaAddressing tenancy law reform »

Special Offers

Comments from our readers

On 6 November 2018 at 9:17 pm John Butt said:
The last paragraph makes a bold statement without any reference, so I suspect it is assumption rather than fact
Fact checking, prices actually stay pretty close to a fixed percentage of household income, now you could argue that HH income rises faster than CPI but so what, rents come out of HH income not CPI
The truth is the real story is far more interesting, rents are rising quickly at present to catch up with incomes; http://listings.jonette.co.nz/blog/auckland-rents-about-to.html

Sign In to add your comment

 

print

Printable version  

print

Email to a friend
News Bites
Latest Comments
  • ASB appoints Vanguard as manager
    “What I find amusing from those industry participants who favour passive investing over active is their continued ignorance...”
    8 hours ago by Pragmatic
  • Law doesn't have to be broken for FMA to take action
    “Agree with Brent Sheather - NZ regulators suffer from what is formally termed 'regulatory capture'. A form of government...”
    14 hours ago by Chatterbox
  • ASB appoints Vanguard as manager
    “Pragmatic just going back 20 years to speak to you, I suspect the ASB’s value proposition is well diversified low cost...”
    14 hours ago by John Milner
  • CLU back on agenda for Massey
    “I'm delighted Massey has elected to do this. The initial efforts of Denis Sampson and others bringing it here from the US...”
    16 hours ago by Referee
  • Old approach won't always stack up
    “Thanks Steve for a thoughtful and moderate comment. I know Brian and the fact was that the client was happy. For the...”
    17 hours ago by MediCare
Subscribe Now

Mortgage Rates Newsletter

Daily Weekly

Previous News

MORE NEWS»

Most Commented On
Mortgage Rates Table

Full Rates Table | Compare Rates

Lender Flt 1yr 2yr 3yr
ANZ 5.79 4.55 4.79 4.99
ANZ Special - 4.05 4.29 4.49
ASB Bank 5.80 4.44 4.69 4.89
ASB Bank Special - 3.95 4.29 4.49
BNZ - Mortgage One 6.50 - - -
BNZ - Rapid Repay 5.95 - - -
BNZ - Special - 4.10 4.29 4.49
BNZ - Std, FlyBuys 5.90 4.69 4.79 4.99
BNZ - TotalMoney 5.90 - - -
Credit Union Auckland 6.70 - - -
Credit Union Baywide 6.15 5.20 5.25 -
Lender Flt 1yr 2yr 3yr
Credit Union North 6.45 - - -
Credit Union South 6.45 - - -
Finance Direct - - - -
First Credit Union 5.85 - - -
Heartland 6.70 7.00 7.25 7.85
Heartland Bank - Online - - - -
Heretaunga Building Society 5.75 4.70 4.85 -
Housing NZ Corp 5.80 4.69 4.79 4.79
HSBC Premier 5.89 3.99 4.19 4.69
HSBC Premier LVR > 80% - 3.79 - -
HSBC Special - - - -
Lender Flt 1yr 2yr 3yr
ICBC 5.80 4.59 4.69 5.09
Kiwibank 5.80 4.55 4.69 4.99
Kiwibank - Capped - - - -
Kiwibank - Offset 5.80 - - -
Kiwibank Special - 4.05 4.29 4.49
Liberty 5.69 - - -
Napier Building Society - - - -
Nelson Building Society 6.10 5.10 5.45 -
Resimac 5.30 4.86 4.94 5.30
RESIMAC Special - - - -
SBS Bank 5.89 4.85 5.05 4.49
Lender Flt 1yr 2yr 3yr
SBS Bank Special - 4.19 3.95 4.49
Sovereign 5.90 4.45 4.69 4.89
Sovereign Special - 3.95 4.29 4.49
The Co-operative Bank - Owner Occ 5.75 4.10 4.35 4.49
The Co-operative Bank - Standard 5.75 4.60 4.85 4.99
TSB Bank 5.80 4.45 4.69 4.99
TSB Special - 3.95 4.19 4.49
Wairarapa Building Society 5.70 4.85 4.99 -
Westpac 5.95 4.69 4.79 5.19
Westpac - Offset 5.95 - - -
Westpac Special - 4.15 4.29 4.59
Median 5.89 4.50 4.69 4.79

Last updated: 2 December 2018 8:39pm

News Quiz

The maximum remuneration model for Australian life insurance advisers is to be set at what?

Upfront 40% + trail 20%

Upfront 50% + trail 10%

Upfront 50% + trail 20%

Upfront 60% + trail 10%

Upfront 60% + trail 20%

MORE QUIZZES »

About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
 
Site by Web Developer and eyelovedesign.com