2023 SUMMARY OF UPDATED TENANCY ACT
By Trish Willis | Member of the Property Institute of NZ (IPAC)
Broad changes to the Residential Tenancies Act have been designed to provide more security for tenants in such things as tenure, rent increases and rental bidding. Failure to comply can incur fines of substantial amounts
The first phase of the changes commenced in August 2020 when it was no longer lawful to increase rent more than once every 12 months. Previously, it was every six months. Changes will continue through to 2025.
Landlords must now ensure their rental properties comply with healthy homes standards within 120 days of any new, or renewed, tenancy. All boarding houses (except Kāinga Ora and Community Housing Providers) must also comply with the standards. By July 2025 all rentals must comply with healthy homes standards regardless of tenure.
Rental property requirements now give tenants more security
Phase 2 of the tenancy law changes began in February, 2021. Phase 2 covered several areas including:
- Security of rental tenure - landlords are no longer able to end a periodic tenancy without cause by giving 90 days' notice.
- Fixed term tenancies - all fixed term tenancies revert to periodic tenancies at the end of the fixed term (with some exceptions, see the Residential Tenancies Act link below).
- No more rental bidding - properties cannot be advertised without a rental price listed and landlords cannot encourage or invite bidding.
- All requests to assign a tenancy must be considered and cannot be declined unreasonably.
- Tenancy agreements must be in writing.
If you’re a landlord intending to sell your rental properties, request a shortlist of vetted real estate agents to compare – it’s a free service – call 0800 789 532.
Tenants can make their homes more comfy
- Tenants can make minor changes to the property - they must ask the landlord but the request cannot be declined if the change is minor. This covers things like hanging shelves and installing baby gates. The tenant is responsible for reversing the changes.
- Tenants can request broadband and landlords must agree if it is no cost to them. There are provisos to this concession.
More legal powers for enforcement
- Suppression orders - names can be suppressed in Tenancy Tribunal decisions if the application for suppression is successful.
- The Ministry of Business, Innovation and Employment has new powers of enforcement when obligations are not being met.
- The Tenancy Tribunal now hears cases and makes awards up to $100,000 (previously $50,000).
Ending tenancies early
Tenants are able to terminate their tenancy without financial penalty if family violence or landlord assault has occurred.
Landlords are able to issue a 14-day notice to terminate a tenancy if the tenant has assaulted the landlord, the owner, a member of their family, or the landlord’s agent, and the Police have laid a charge against the tenant in respect of the assault.
If both tenants and landlords agree, tenants can apply to end a fixed term tenancy early and pay only for reasonable costs to the landlord for doing so, for example, the cost of advertising for new tenants.
If a landlord is in breach of the Tenancies Act for reasons such as not meeting health and safety standards or insulation standards, tenants can request cancellation of the tenancy agreement. However, the landlord has to remedy the situation or may be liable for a fine from the Tenancy Tribunal should the tenant report them.
Raise The Standard is a tool for both landlords and tenants to be clearer on current Healthy Home Standards and dates through to the final 2025 deadline.
To find out about the requirements in more detail, see the Residential Tenancies Act 2020 Summary of Changes.
Tax rules around claiming against rental income and the bright line test
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Page updated February 21, 2023 by Trish Willis | Member of Property Institute of NZ (IPAC)
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Disclaimer: The content of this researched article is general in nature and not intended as a substitute for specific professional or legal advice on any matter and should not be relied upon for that purpose.
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