The Healthy Homes Guarantee deadline for insulation of rental properties passed in July 2019 and since then, a number of landlords have been fined for failing to insulate to the Government standards. The next deadline is July 1, 2021.
As a result of the Healthy Homes Guarantee, landlords now have an obligation to make their rental properties warmer, drier and healthier homes for tenants. A Stats NZ survey released in January 2020 found a third of Kiwi houses were too cold in winter.
Tenants now receive rent reimbursements and compensation for living in cold housing without adequate heating.
Be prepared for July 2021 deadline says Property Investors Fed
From July 1, 2021, all private rental properties must comply with the new standards within 90 days of any new or renewed tenancy.
NZ Property Investors Federation president Andrew King is advising landlords to be proactive and line up tradespeople sooner rather than later because current high demand for them due to people spending money on renovations rather than overseas travel means they could have trouble getting the work done if they leave it too late.
There can be hefty fines if requirements are not met depending on the understanding of tenants and the leniency of the Tenancy Tribunal.
Since December 2020, landlords have been required to include a statement of their current level of compliance with the standards in most new or renewed tenancy agreements.
By July 1, 2024 all private rentals will need to be compliant regardless of whether the tenancy has changed.
The standards introduce specific and minimum standards for heating, insulation, ventilation, moisture ingress and drainage, and draught stopping in all rental properties, including boarding houses where rooms are rented to tenants individually. Accommodation which is intended to house six or more tenants, where individual rooms are rented to tenants with shared facilities such as the kitchen may be operating a boarding house, Tenancy Services says.
Landlords fined for breaking insulation laws
As of February 2020, landlords had been fined a total of $124,000 in fines in 120 Tenancy Tribunal cases for breaking the insulation laws that came in in 2019. Landlords can be fined up to $4000 for failing to insulate rentals with the money going to tenants.
It is believed the number of rentals that remain uninsulated could be much higher.
Even only one in 10 state homes currently meet the standards, although the Government says it is on track to fully meet the standards by its 2023 deadline for state housing.
There are a number of other deadlines to be met through to 2024. Read on to find out about them and to find out what financial assistance and discounts are available for rental property owners.
If insulating your rental(s) is not an option and you want to sell up you are not alone.
AVOID HEFTY LANDLORD PENALTIES ARISING FROM THE HEALTHY HOMES GUARANTEE
From July 1 2019, insulation became compulsory in all rental homes in New Zealand. Failure to comply can result in hefty penalties.
If you haven't started making your rental property a healthy home for your tenants already, it's better late than never.
Tenancy Services provides landlords with everything you need to know about types of insulation, topping up or upgrading insulation, whether it's needed and costs. But check below to see if you qualify for an exemption first.
Find out more about the Health Homes standards.
HEALTHY Home Help For Landlords
If you're a landlord, you should have your property insulated to Healthy Homes Guarantees Act standards by now. To find out about other healthy homes standards which will be phased in between now and July 2024, see the chart below.
If you're looking at getting into property investment and becoming a landlord and considering properties with sub-standard underfloor and ceiling insulation and heating you will need to bring the house into accordance with the Healthy Homes Guarantees Act.
The Ministry of Housing and Urban Development has extensive information about Healthy Homes standards including Question and Answer and Fact Sheet PDFs.
While grants are available to owner-occupiers, landlords are no longer eligible for a Government grant to help with insulation and heating. However, the EECA is working with councils throughout the country to allow people not eligible for a Warmer Kiwi Homes grant to access payment options which can be paid off as part of your rates bills.
Alternatively, your bank may be able to help. If you have a mortgage with ANZ, you can apply for interest-free home loan top ups of up to $5000 for insulation and up to $5000 for heat pumps, payable over four years. If your mortgage is with ASB, BNZ, Kiwibank or Westpac you might be able to add the cost of insulating your house to your mortgage.
If you are in Canterbury or the West Coast (from the Rangitata River to Kaikoura, and the West Coast) Community Energy Action (CEA) provides landlords with 25 per cent discounts.
If you're going DIY, there are standards with which you must comply and the same page provides these standards for you.
Exceptions to the insulation regulations
Due to the design or construction of some rental properties, insulation may not be physically possible or require a major renovation to do so. Find out here if you qualify for an insulation exemption.
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Opting To Sell Your Rental Property?
If the cost of insulating is not affordable and you're thinking of selling your rental property instead, you will want to know how much you could expect to sell it for first by requesting a real estate appraisal.
A real estate market appraisal will help you make that decision, so make sure you get an accurate market valuation by using a vetted real estate agent, whose estimate you can rely on to get the best sale price.
But first, find out about real estate commission and fees here.
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Article updated January 6, 2021 | About