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Goodbye shitty landlords

Written By: - Date published: 10:27 am, November 18th, 2019 - 97 comments
Categories: housing, tenants' rights - Tags: ,

The government announced new tenancy protection regulations yesterday. From RNZ,

The proposed changes include:

  • Limiting rent increases to once every 12 months
  • Banning rental bidding
  • Ending no-cause evictions
  • An increase to financial penalties
  • Tenants will be able to add minor fittings and improvements, such as baby proofing or hanging pictures.

A bill setting out the proposed changes to the Residential Tenancies Act 1986 is expected to be introduced to Parliament in the first half of next year.

Some snips from twitter this morning,

I definitely feel this is a situation where Labour need to be encouraged to keep doing the right things. Each step that gives renters more security (of tenancy, a healthy home, affordable rent) takes us to a culture where housing is for providing NZ citizens with a home and away from the culture that says homelessness and poverty are collateral damage in the middle class quest for investment income. When we centre homes as a human right the solutions to the housing crisis become clearer.

97 comments on “Goodbye shitty landlords”

  1. Kevin 1

    40,000 Unoccupied dwellings in Auckland.

    With the housing shortage this is obscene and there should be penalties for this.

    • A 1.2

      Hate to point this out but the new legislation won't do anything but make this worse.  Much needed is something that will encourage utilisation of empty homes. 

      In the meantime I look forward to the flood of homes for sale from LL’s exiting the business.

      Looking forward to hanging pictures.

      • weka 1.2.1

        how will it make things worse?

        • A 1.2.1.1

          I would think that because they are afraid of getting a bad tenant they can't get rid of, they might decide not to have any at all.  But who knows?  Property takes time to move so they might realise that the changes are actually more supportive of long term relationships with tenants which seems to me to make business easier. 

          • weka 1.2.1.1.1

            right, in which case the govt will need to follow up these regs with regs and incentives to not let properties remain empty in areas where there is a housing shortage. This is what I mean about putting home rights in the centre. We can't hold off on the things that will improve housing because there are a range of issues that need to be resolved, nor because the investor class is holding us to ransom.

      • Ed1 1.2.2

        I am sure that in the current market landlords wishing to find better returns elsewhere will have no difficulty in selling their property. Most find short term tenants more trouble than longer term tenants anyway.  Where do you think they will invest their capital for better returns, "A"?

        I agree that something is needed to encourage utilisation of empty homes – here is one possibility:

        https://vancouver.ca/home-property-development/empty-homes-tax-frequently-asked-questions.aspx

         

        • A 1.2.2.1

          Vancouver empty home tax has been around for awhile so should be easy to see if this is a good idea or not.  Will check out later…

          Where to invest other than real estate?  

          I like https://www.royaltyexchange.com/ and peer to peer lending mainly due to the simplicity.  Peer to peer is particularly appealing because it doesn't require much to start so a kid can do it, but still can scale up to larger amounts.

          Sprott for resource investing, Sovereign Man 4th pillar for finding large gains with the smallest risk possible, possibly EuroPacific Capital might be great, and various crypto assets.  Of course all of these are more international type investments but I think that might would be better in the current environment.

          I did email Martin North (DFA blog) to ask if he had any financial advisors to refer me to in NZ who think like he does.  He didn't but said he would let me know if he came across anyone.  Obviously this type of person wouldn't be into real estate. 

          In any case renters would be better off investing rather than borrowing for an overpriced shackle that will likely fall by 30% or more in the next two years.   

      • Sabine 1.2.3

        great let them sell, people will be buying. 

        they are still not loosing the poor dears. 

    • Blazer 1.3

      A levy on residences left empty without a compelling reason ,and one on unutilised land,needs to be introduced.

      • weka 1.3.1

        I'm in favour of that except I'd put the levy on when the empty land gets sold. Many NZers build a house on land that they've owned for years, because they can afford the land but not the house build at the same time, so there is a lag in between. What we want is to stop people speculating on land sales, which is different than land being empty. This applies to individual titles, not developer land.

      • KJT 1.3.2

        As a lot of people get the land some time before they build, because they cannot afford both, I agree with Weka.

    • gsays 1.4

      cough… squatter's rights …cough.

  2. Stuart Munro. 2

    The sentiments are certainly sound – whether enough seeps through the cracks in the redoubts of vested interest and neoliberal inanity to make a positive difference remains to be seen.

  3. ianmac 3

    The aim must be to give tenants longterm security of tenure. In I think Germany, there are heaps of tenants who live in the same rental for lifetimes. Rent increases are limited, and good tenants and landlords get along respectfully.

    The rhetoric against changes announced yesterday seem to miss the point.

  4. UncookedSelachimorpha 4

    One additional change I would like to see – if a tenant wins a dispute at the tenancy tribunal, the tenant should have the right to have their identity suppressed and the right to keep their use of the tribunal private (i.e. not disclosed to future prospective landlords).

    At present a tenant can take a shitty landlord to the tribunal, win….and then have trouble getting another rental for the rest of their lives.

     

  5. UncookedSelachimorpha 5

    These are small steps in the right direction, far, far short of a full German-style rental regime. The reported objections from landlords are pathetic and should be ignored.

    I doubt you can have affordable rents without property prices significantly falling (one way or the other). But NZ is addicted to the idea that owning a property should entitle you to large capital gains year on year (with no thought as to where all that money is actually coming from!). Breaking out of the current property price madness is politically difficult.

     

     

    • weka 5.1

      crunch time for the liberal middle classes who want a solution to the housing crisis on compassionate grounds but can't quite make the connection with their own decisions. I see few people saying they're will for their house GV or market value to drop.

    • Rrm 5.2

      ???

      There are capital gains because prices are rising.

      Prices are rising because the pool of buyers is growing faster than the pool of houses is growing, and buyers can get cheap credit.

      Phil Twyford just discovered that it's not easy to build houses in New Zealand.

      There's a lesson in that, if Labour and the wider left are smart enough to take it…

      • A 5.2.1

        The expectation that tenants or the government will continue paying ever increasing rents is the real issue.

        • Gosman 5.2.1.1

          It is called the market. Demand is outstripping supply. In that case the price goes up. It ain't rocket science.

          • Blazer 5.2.1.1.1

            If this market you speak of, is so efficient why does the Govt pay around 2.5billion in accommodation supplements per an.?

  6. Gosman 6

    This is so funny. Perhaps you can solve Climate change by mandating the weather not to get too hot. Marama Davidson's calls are especially hilarious. There is only one outcome of setting price controls below the market rate and that is shortages of supply. Marama Davidson is essentially advocating for more homelessness. Congrats on that Marama 

    • Stuart Munro. 6.1

      only one outcome of setting price controls below the market rate and that is shortages of supply

      Poppycock.

      Since little or no housing is being built for rental that effect would negligible. There might be an increase in slumlords leaving the market, returning their properties to possible occupier ownership, which would be a net positive.

      • Gosman 6.1.1

        Not if supply fails to meet demand even further than it is at the moment. Then you get more HOMELESSNESS.

        • McFlock 6.1.1.1

          Because dwellings just disappear if landlords don't rent them out?

          Just how many slumlords can wear the rates on a property that has no tenant while they wait for the value to increase and give them a capital gain?

           

          • Gosman 6.1.1.1.1

            Oh there will be a short term impact on the housing market as landlords unwilling to take on the extra costs and risks offload their properties. However it will soon be swallowed up by the massive under supply of new house builds. On top Renters who still won't be able to afford to buy a place will now have even less properties to choose from and rents will skyrocket. These are unfortunately the poorest section of society. 

            • McFlock 6.1.1.1.1.1

              That is a profession of faith.

              You sad devotion to theoretical demand and supply curves is merely a distraction from reality, and your concern for the poor would be touching if it were honestly-held.

              There are many wider factors at play in the property market than banning rental bidding and slowing rent increases. Let the leeches suck the blood more slowly, it won't do them any harm and it will be better for their prey.

              • Gosman

                You keep believing you can beat the market McFlock. It will only be the little people that will get hurt after all.

                • McFlock

                  The only difference between you and Israel Folau is the flavour of magical entity you believe in.

                  • Gosman

                    And I can physically see the results of mine 🙂

                    • McFlock

                      Wishful thinking and blinkers are shared by you both. He literally just gave a speech where he claimed to see the results of his.

                    • Gosman

                      Except his was done AFTER the event. I am making the prediction BEFORE. 

                    • McFlock

                      Regardless of how the economic entrails fall, you'll interpret them to suit your "prediction".

                      Just like you always do.

                    • Gosman

                      No, no. I'm quite happy to make the prediction now. The rental property market will get worse for renters if any of these politcies become a reality UNLESS demand suddenly drops off (unlikely) or there is some stimulus applied to the supply side outside these policies.

                    • McFlock

                      See? Both ways, no specifics on magnitude. And given that the govt has spent the last two years also trying to affect the "supply side" of the housing market in a variety of ways (with good success in state housing, not so hot on kiwibuild, dunno how the prefab plant is working up, there's also moves on consents processes I think), there is literally no way your comment is falsifiable. If rents go up, you'll say "yay me". If rents go down you'll say "supply-side efforts like I said, yay me".

                      You made a religious proclamation, not a prediction.

                    • Gosman

                      My position is definitely falsifiable. If all other elements I mention remain constant then I predict the policy proposals being touted will lead to increased rents and/or homelessness. I would expect it to take significantly more houses (above the long term average increase) and/or significantly less demand (below the recent increases) to affect this. These are easily identifiable.

                    • McFlock

                      If all other elements I mention remain constant

                      lols
                      meanwhile, in the real world
                       

                    • Gosman

                      And then I stated you could quantify the scale of the impact of the changes IF they DID occur. If there is only a modest increase in supply such as we have at the moment then the changes to the Rental laws will drive up rental prices. 

                    • Gosman

                      BTW the Dashborad you linked to looks REALLY sad for people looking to get a home. The government is failing miserably on this front.

                    • McFlock

                      No, you just opened your way to an argument about the meaning of "significantly" in order to defend your catechism.

                      How many landlords will fail to meet the grade? How many of them will neither sell nor let out their derelict buildings, so the houses are truly removed from the market?

                       

                       

        • Stuart Munro. 6.1.1.2

          It's not a convincing kite to fly Gosman. Have you got any rational criticisms?

        • weka 6.1.1.3

          "Not if supply fails to meet demand even further than it is at the moment. Then you get more HOMELESSNESS."

          This is the situation we are in already. So your argument just sounds like let's accept there will always be homelessness and housing crisis driven poverty, because TINA and at least it's not worse. Poppycock. This is just the investor class saying their right to profit trumps people's right to a home and now lecturing the left that the housing crisis the investor class created in the first place and serves them really fucking well can't be changed.

          Build some more houses, stop being greedy, let the govt pass some laws that shift existing houses out of capital gains capture and back into providing homes.

  7. greywarshark 7

    Cars have to be registered and have wofs.   They are an important asset for people and useful to the citizens of the country.     Why not houses, just keeping a check on problems and if they get fixed.    At present I wouldn't pass but if that was noted, and I get the process of painting etc on a time and payment schedule, it would not be onerous.    The wof would only relate to practical maintenance and not involve snooping for misdemeanours against Council planning requirements.   

    There seems a tendency to dream up champagne requirements for those with beer incomes, and not bothering wealthy businesspeople too much with regs is now disavowed, and the regs descend like a stormburst after drought.

  8. Tiger Mountain 8

    Does not take much talk of “rights for renters” to get the neo rentiers and property flickers squealing. More professional landlords are often in it for the longer haul. The Govt. has done well already by abolishing letting fees and putting in minimum dwelling standards.

    Young NZers in particular deserve much more than paying off some one else’s mortgage, when they do not have secure tenure and decent rights as some recompense for their extortionate rents.

    10 years going hard out building public housing would be a start. When supply is squared up a bit, time for rent control! Private developers prefer to cherry pick the McMansion market and Building/construction Co.s and suppliers seem to just want their profits. So…if they won’t acquire some public spirit, import flat packs and build modular. A nice kick in the nuts for them too.

    • Gosman 8.1

      Fair enough. Why do you think that Labour hasn't advocated for this and The Greens haven't costed a plan for it?

      • bwaghorn 8.1.1

        The first thing that needs to be done is wipe out rent subsidies and make landlords wear the difference between what the tenant is paying out of their own pocket and what is being charged . 

        As long as landlords have a government gaurentee on the rental income the housing market will always be skewed and screwed. 

         

        • Gosman 8.1.1.1

          Or there will be even less people willing to rent out properties.

          Do ANY of your proposals involve actually increasing supply?

          • bwaghorn 8.1.1.1.1

            More state houses ,lots and lots of them . 

            Can you not see how rent subsidies are just making it worse . 

          • KJT 8.1.1.1.2

            We've been proposing increasing supply, here for a long time.

            Building state houses in the scale we managed in the 50's.

            Successfully, and with "printed money" by the way.

            Of course right wingers only believe in printing money, if banks charge interest for it. Or it is free money to bail bankers out of their fuckups.

            Of course cutting the demand from 350 000 “guest workers”, 70 000 new people, capital gains farming ,and foreign money launderers, is also required.

            • Gosman 8.1.1.1.2.1

              You may have advocated for it but for some reason the actual parties you support aren't delivering massive amounts of new State houses.

              • weka

                Do you want lots more state houses or not Gosman. It's hard to tell.

                • Gosman

                  I'm not terribly fussed where the extra houses will come from. I just doubt the capacity of the State sector to do it. I'm willing to be surprised but the market is not going to be satisfied by an extra 1000 or so State houses every year. Do you know what the deficit is between the demand for housing versus the supply at the moment?

                  • weka

                    Nope. Do you know what the difference is between supply and numbers of existing houses? The problem with not caring where the extra houses come from is that we don't have a shortage of houses in NZ, there are plenty. We have a shortage of houses available at affordable cost for people to live in. If the state doesn't control house building across the board, then the costs will just keep increasing. We can already see that simply having more houses doesn't create more supply.

                    • Gosman

                      You are wrong. There is a shortage of houses in NZ. That's the cause of all the woes.

                    • Sacha

                      Unless we address the demand factors that make housing an attractive 'investment' more supply will not fix the problem, Gos.

                    • weka

                      Gosman, you do understand that there are more empty houses in NZ right now than there are people to live in them, right?

                    • weka

                      My thinking atm is around how we can shift the stalemate where the middle classes won't support a strong left wing govt because of how it would impact on their housing capital.

              • Drowsy M. Kram

                National's policy on "old, run down state houses" – replace 'em! Who needs 'em anyway?  Some were salivating at the 'opportunities' attached to such 'replacement.'  There is, however, a clear alternative re state houses.

                "Our new build and renewal programme will see us invest $5.6 billion in our state houses from 2018 to 2022 – the largest investment in our houses for decades providing better quality homes for people and their families."
                https://www.hnzc.co.nz/housing-developments-and-programmes/our-new-state-homes/

                "The previous Labour Government had torn down state houses on one block of land with the intention of rebuilding them, but the following National Government did not rebuild them and tore down houses on the other two blocks."
                https://www.stuff.co.nz/manawatu-standard/news/116120326/palmerston-north-housing-crisis-aided-by-105-new-state-houses-within-three-years

  9. lprent 9

    Good legislation. I'm (almost inadvertently) a landlord and sort of a tenant myself at present.

    I rented out my apartment for a few years when we rented a bigger place for doing the video edit on one of my partners docos. Then we moved back in 2012

    My partner decided that she was going to buy an apartment a couple of years ago, and that she was going to do it on her own. All she could afford with any certainty about location and integrety about quality was another one bedroom apartment in the same block. So she scraped up her assets to get a deposit, and brought it for just about 2.5x times the value I brought mine for back in 1998.

    Then she dragged me upstairs to help pay for it as a semi-tenant 🙂  I couldn't see any reason to sell my apartment just in case we did something weird like break up. That doesn't seem too likely as she moved into my apartment in 2008 – which seems like a lifetime ago. But shit happens…

    Ran my apartment as a airbnb for about a year because my sister was doing that to a room in her house, and when she was fixing up their bach and launch. She was willing to do the most of the work for a substantial cut. When she started to look at purchasing and running a business, I rented it out as a furnished one bedroom. Initially using a property manager while I was doing a lot of work in Singapore. More recently myself.

    "Okay, cool. None of that changes anything for me, all sounds sensible."

    That pretty much describes me as well. Of course it helps that my tenants are in the same block.

    I’d have to look up the tenancy agreement, but I think that I already have a 90 day notice (and 30 days the other way). Rent changes only happen yearly – but I’ve never raised rents except if tenants change (good tenants are pure gold). We do the tenancy yearly. I fix things that I can, but it is pretty modern so that happens seldom.

  10. UncookedSelachimorpha 10

    RNZ have republished a long article from 2018 on the Tenancy Tribunal and predicaments renters can find themselves in, it is an interesting read:

    https://www.rnz.co.nz/news/in-depth/365295/why-renters-won-t-complain-about-landlords

    • ianmac 10.1

      Thanks Uncooked. Illuminating. System clearly needs revision.

      Maybe there should be a star rating for Landlords so that Tenants can get fair warning of bad landlords. I bet landlords have done bad stuff previously.

  11. Ian 11

    I have a very nice house that I have spent $60000 on lately  ,that could be a rental but I  don't need the hassle . Getting good tenants is like finding opals.  A worker on the farm  who has been here for 9 years and is waiting for his residents visa will be  hopefully moving in after  the slow coaches at immigration NZ  finally process his application. He will then bring his wife and son out to NZ . God willing.

     

     

     

    • weka 11.1

      Oh cool, you're going to let them live in it for free.

      • Ian 11.1.1

        No, it won't be free but will be at a minimal rental to satisfy IRD. Will bump his salary up to cover the shortfall. Good employees are like gold and need to be treated accordingly. Good tenants  no doubt exist but I am much happier having an empty home in the meantime.

    • David Mac 11.2

      I believe finding dependable tenants to pay astronomical sums is becoming easier in the Far North. Contacting the 128 unsuccessful applicants with their bad news has become the hard bit.

      Last one being let that I'm familiar with went to a near retiring couple who will spend 12 days of every fortnight at their Auckland home and every 2nd weekend at this coastal place they're renting.

       

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