How Does the New Government Impact Rental Properties in Auckland, NZ?
On the 19th of October 2017, we saw New Zealand First form a coalition government with Labour and the Greens. All the parties campaigned heavily on rental property reform, which will include changes to rental properties and the entire industry. It’s going to mean being a landlord in Auckland and across the country will be harder and more expensive. Today, we are discussing the likely changes we will see with this new government.
Landlord Education: New Requirements
Right now, a landlord can review and increase rent every six months. With the new rental legislation from this government, it will be extended to every 12 months. Additionally, the mechanism a landlord uses to raise rent will need to be laid out in the tenancy agreement at the very beginning of the tenancy. Letting fees that are currently paid by tenants are going to be abolished, and landlords will no longer be able to end a tenancy without stating a reason. So, to evict a tenant, the landlord will need to go to the Tenancy Tribunal and win to get rid of unwanted tenants.
Warrant of Fitness
Another huge change we may see is the introduction of a Warrant of Fitness for rental properties. These are minimum standards that all rental properties will have to meet. The standards will mostly focus on heating, ventilation, and insulation. If landlords don’t meet these standards, you might find they get demerit points. Landlords may be forced to pay a maintenance bond. This will be drawn upon when the property doesn’t meet certain standards under the Warrant of Fitness, and the property will need to be improved.
The other changes that will be introduced are extending the Brightline test from 2 years to 5 years and stopping negative gearing (the ability to offset losses from a rental property against personal income)
So, we have a change in our government, and that means we have huge changes ahead for landlords. If you have any questions about the law or anything pertaining to property management in Auckland, NZ, please contact us at Walker Weir Property Management.