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COMMENT: The ongoing fight for landlords’ rights

Proposed changes to tenancy law have left landlords fighting to retain the right to end difficult tenancies while students are fighting for the right to party, reports NZ Property Investors Federation executive officer Sharon Cullwick.

Saturday, April 18th 2020, 7:03AM 2 Comments

Sharon Cullwick

Covid-19 may have put a halt to most Parliamentary business, but not the passage of the Government’s proposed tenancy law reforms.

Verbal submissions are currently being made to the Social Services Select Committee which is looking into the proposed changes to the Residential Tenancies Act.

It hasn’t been widely reported on, but a section of the Act gives tenants the right to perform up to eight significantly disruptive acts a year.

And, as long as there are not more than two of these acts in any one three-month period, it will not be until the end of that year that their landlord can apply to have their tenancy ended with three months’ notice.

However, this new right does not go far enough for the NZ University Student Association.

Their National Vice President, Sam Smith, told MPs at the Select Committee hearing that these new rights are not strong enough.

“Many students are at a stage of their lives where they are discovering themselves, meeting new people, and experiencing life outside of their family home” said Smith. He said that it is reasonable for students to hold social events.

While the NZPIF also thinks it is reasonable for people to have social events as well, they can’t imagine that many people would want to live next door to anyone who has eight significantly disruptive parties a year.

But most New Zealanders don’t realise that this is some of what the Government is proposing to allow via its reforms to the existing tenancy law.

Currently, if neighbours of a tenant bring disruptive or antisocial behaviour to the attention of their landlord, the landlord can assess if the best course is to end the tenancy of that tenant with a 90-day no stated cause notice.

The landlord can protect the affected neighbours’ identity because they currently do not have to say why they are ending the tenancy. There is always the possibility of retribution if the neighbours’ identity is not protected in this way.

But the proposed new law states that neighbours will have to provide proof of three significant antisocial events over a three-month period before the landlord can apply to the Tenancy Tribunal for permission to end the tenancy after a further three months.

Some of the other submitters on the legislation claim that this proposed change is to provide security for tenants.

These submitters are of the opinion that many good tenants are being thrown out of their homes for no reason.

Yet this opinion is debunked by NZPIF research that shows only 3% of tenants each year are given a 90-day no stated cause notice.

In reality, there is no evidence that this tool of last resort is being misused by landlords. In fact, the evidence shows that it is used entirely appropriately to protect neighbours of severely disruptive tenants.

The proposed changes mean that affected neighbours will have to endure six months of a very unpleasant environment in their neighbourhood. The NZPIF does not want to see neighbourhoods affected in this way.

Not long before the lockdown began, the NZPIF started a petition to leave the RTA unchanged. That petition has now been signed by over 8,500 people and remains open. Those interested in signing can do so here.

Read more:

Put RTA reform proposals on ice

Tenancy reform Select Committee hearings to go ahead

Key reform will only protect bad tenants

Tags: compliance conduct landlords legislation NZPIF property investment property management rental market RTA tenancy reform tenants

« COMMENT: Making sense of it all: COVID-19, the economy & propertyCOMMENT: The rental housing conundrum »

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Comments from our readers

On 20 April 2020 at 11:33 am Andy the adviser said:
While I believe Aunty Jacinda is doing a great job with the Covid19 response, this government is hell-bent on destroying the rental market. It is taking rental property management and provision away from the private sector.

Beware the seeds you sow, Jacinda! The next government may have a huge housing crisis on its hands - having to supply, manage repair and finance a growing level of social housing required.

If providing rental accommodation for those who cannot or do not want to buy their own home is going to cost landords/investors, they will get out of the market. This will leave only those who have been in the market for a long time where rents are now cash-flow positive. The alternative will be increased rents to meet the costs (consider especially when the interest rates rise again).

There are going to be some nasty surprises from these seeds...
On 24 April 2020 at 6:55 am Dr Bones said:
In November 2013 we rented a house that had been recently renovated by EQC contractors and was in good condition at the commencement of the tenancy. By Dec 2019 the house had been wrecked by our tenants to the point where our only remaining options are to try to sell it on as “as-is—where-is” basis or to demolish it and try to sell the bare land. Much of the damage was caused by running water from a split copper pipe in the bathroom that was a result of the tenats attempting to fix the plunbing without our permission. The kitchen was also extensively damaged by careless use on the part of the tenants. Yes it is true that we did not carry out regular inspections of the property, relying instead upon the tenants to inform us if there were maintenance issues to which we needed to attend. They informed us of nothing throughout the entire tenancy, apart from one call-out to a blocked sewer to which we attended propmptly in Dec. 2013.

They lied that we had not provided working smoke alarms at the start of the tenancy. Despite this and other lies told by the tenants throughout the hearing the Adjudicator accepted their evidence and rejected our truthful evidence. With regard to the smoke alarms and the question of who was telling the truth there was no was no objective proof either way. Yet, for the smoke-alarm issue alone we were fined $3000.

We served an eviction notice after inspecting the property in Dec 2019 and they retaliated by seeking $15000 in compensation through the Tenancy Tribunal. We submitted a cross-application seeking compensation for damage to the property. The tenants were awarded a total of $7000 against us, our application for compensation for careless use of the property was summarily dismissed, and the bond was awarded to the tenants. The ruling contains numerous factual errors and incorrect/inappropriate assumptions, so we filed for a rehearing through the Tenancy Tribunal. The application for a rehearing was approved, subject to a 90 minute “rehearing hearing” which has yet to take place. Meanwhile, the original ruling (April 2020) has been placed on the Tenancy NZ website despite the fact that it it riddled with factual errors. Including the bond, we had a total of $8560 awarded against us; we are left with a house that is beyond economic repair and has zero resale value. Meanwhile the tenants have been handsomely rewarded for having wrecked our property. We are furious!

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Lender Flt 1yr 2yr 3yr
AIA 4.55 3.19 3.19 3.49
AIA Special - 2.69 2.69 2.99
ANZ 4.44 3.15 3.25 ▼3.39
ANZ Special - ▼2.55 ▼2.69 ▼2.79
ASB Bank 4.45 3.19 3.19 3.49
ASB Bank Special - 2.69 2.69 2.99
Bluestone 4.44 4.44 4.44 4.44
BNZ - Classic - 2.65 2.69 2.99
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.25 3.29 3.59
Lender Flt 1yr 2yr 3yr
BNZ - TotalMoney 4.55 - - -
China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 4.75 4.75 -
Credit Union South 5.65 4.75 4.75 -
First Credit Union Special 5.85 3.35 3.85 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online - - - -
Heretaunga Building Society 4.99 4.35 4.45 -
HSBC Premier 4.49 2.60 2.65 2.80
Lender Flt 1yr 2yr 3yr
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 3.99 2.58 2.68 2.79
Kainga Ora 4.43 3.29 3.39 3.85
Kiwibank 3.40 3.40 3.54 4.00
Kiwibank - Capped - - - -
Kiwibank - Offset - - - -
Kiwibank Special 3.40 2.65 2.79 3.25
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Lender Flt 1yr 2yr 3yr
Resimac 3.49 3.45 3.39 3.69
SBS Bank 4.54 3.29 3.19 3.49
SBS Bank Special - 2.79 2.69 2.99
The Co-operative Bank - Owner Occ 4.40 ▼2.69 ▼2.75 ▼2.99
The Co-operative Bank - Standard 4.40 ▼3.19 ▼3.25 ▼3.49
TSB Bank 5.34 ▼3.35 3.49 3.79
TSB Special 4.54 ▼2.55 2.69 2.99
Wairarapa Building Society 4.99 3.75 3.99 -
Westpac 4.59 4.15 4.09 4.49
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.55 2.69 2.79
Median 4.55 3.19 3.22 3.39

Last updated: 10 July 2020 9:02am

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