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Changes to RTA now in force

The Government’s controversial tenancy law reforms are now law after the Residential Tenancies Amendment Bill 2020 received Royal Assent on 11 August 2020.

Wednesday, August 19th 2020, 11:55AM 3 Comments

by The Landlord

This means there will be  a number of changes to the Residential Tenancies Act 1986 which will affect both tenants and landlords.

Tenancy Services is advising that some of these provisions took effect from 12 August 2020, while the remainder will come into force at two subsequent dates over the next year.

They have released the following timetable of when the various changes come into effect.

From 12 August 2020:

• Transitional and emergency housing are now exempt from the Act.

• Rent can only be increased once every 12 months. This is a change from once every six months. But there continues to be a freeze on rent increases, which means landlords cannot increase rent until after 25 September 2020.

From 11 February 2021:

• 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 have changed.

• 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.

• 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.

• Rent bidding prohibited: 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.

• Landlord records: Not providing a tenancy agreement in writing will be an unlawful act and landlords will need to retain and provide new types of information.

• Enforcement measures strengthened: The Regulator (MBIE) will have new measures to take action against parties who are not meeting their obligations.

• Tenancy Tribunal jurisdiction changes: The Tenancy Tribunal can hear cases and make awards up to $100,000 (which is up from $50,000).

Also, the provisions, which were introduced in a last-minute Supplementary Order Paper during the final debate over the legislation, must come into effect by 12 months after the day of Royal Assent (11 August 2021). However, they may come in earlier if the Government agrees.

Those provisions are that:

• A landlord will be able to issue a 14-day notice to terminate the tenancy if the police have charged the tenant with assault of the landlord, a member of the landlord’s family, or the landlord’s agent.

• A victim of family violence will be able to withdraw from a tenancy without financial penalty.

More information to help landlords and tenants understand the changes and how they should work is available from Tenancy Services here and here.

Tenancy Services has also updated its tenancy agreement template, which can be found here.

Further, Tenancy Services says it will be developing educational webinars and online decision tools. These will be highlighted on the Tenancy Services website as soon as they are available.

Additionally, the Ministry of Housing and Urban Development (HUD) has information on the changes here

Read more:

Radical tenancy reforms now law 

New rental laws will have unexpected outcomes 

Tags: compliance conduct housing market investment Kris Faafoi landlords property investment property management rental market rents RTA tenancy reform Tenancy Services Tenancy Tribunal tenants

« Persistent RTA breaches cost landlordRoutine inspection pays off »

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Comments from our readers

On 19 August 2020 at 9:22 pm simon a said:
Hi does anyone know of any seminars being run on this sh**t ? Looks quite complicated and open to abuse by clever tenants.
On 20 August 2020 at 11:54 am Property Leader said:
I have just read through the Tenancy Services standard tenancy agreement as per the link above. I see that agreement states tenants must give 21 days notice and not the 28 as specified in the RTA amendments.There are a few other things wrong also. How does one deal with an issue when the department gives out incorrect advise?
On 22 August 2020 at 9:11 am KeenReader said:
I wish to share a word of warning with all landlords about the effect of this new legislation based on a recent personal experience of its abuse.

Within a week of the legislation being passed, a tenant of ours who was given discounted rent $500/ wk (market rate is $630-680) and we pay 100% of their water usage decided they would abuse their powers under the Act.
They commenced the tenancy in May on the proviso that part of the property continues to be used by us, the landlords. This was the basis of the discounted rent and water paid for.
The tenant has 4 children, so a total of 5 occupants. However, within a short time their boyfriend moved in adding another adult to the occupants including water usage.

Recently we gave notice some maintenance needed to be carried out, vegetation removed, painting requiring a scaffold, etc at a total cost to us of $12,000. As a result of carrying out the work the tenant is now claiming their right to quiet enjoyment has been affected and have threatened going to the tribunal.

The tenant now demands a back-dated reduction in rent from the start of the tenancy 3 months ago to the value of $100/ week. This is for the privilage of us as landlords carrying out essential maintenance.

We now cannot get rid of these tenants under the new legislation. The tenant continues to devise a long list of issues with the property she doesn't like as a means of creating problems and angling for further discounts.

At the end of the fixed-term the tenancy will turn into a periodic, we can't enact a no-cause termination and a family member can't move in as it's owned by a company. The only solution I can think of to get them out is to increase the rent to market and pray to God she will find somewhere else to move to.

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SBS Bank 4.54 3.05 3.19 3.25
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The Co-operative Bank - Owner Occ 4.40 2.55 2.69 2.79
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Median 4.55 3.00 3.13 3.02

Last updated: 21 September 2020 10:48am

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