What changes are coming to rental properties in 2020?

What actions you take as a landlord in 2020 are dictated by several laws that are set by the Residential Tenancies Act 1986. These also include the minimum requirements you must meet when it comes to the Healthy Homes Standards, with the aim to increase the quality of rental accommodation available across New Zealand.

The government is working to help protect those that rent homes across the country but what does this mean for landlords in 2020? In this blog, we will look into what proposed changes are on the agenda as well as what requirements will need to be actioned to meet the laws beyond 2020.

What you need to know for 2020

The next important date is July 1st 2020. From this date, all new, varied (where a new flatmate has moved in) or renewed tenancy agreements must receive a statement of the current level of compliance with the new act.

Here at McDonald Real Estate we are well on our way to producing this compulsory statement by sending an assessor to all rental properties under our management to assess each property for it's current level of compliance. From here our landlords will have a clear idea of what they need to do to comply moving forward as well as knowing what they already comply with.

Proposed changes under the Residential Tenancies Act for 2020

Associate Housing Minister Kris Faafoi announced proposed changes to the Residential Tenancies Act 1986 during a press release at the end of November 2019.

"The changes will be drafted in a bill to amend the Act. This will be introduced to Parliament in the first half of 2020." he says.

The proposed changes are as follows:

• Landlords will not be able to end a periodic tenancy without a reason. The legislation will set out specified reasons that a landlord may use to end a periodic tenancy.
• Fixed-term tenancies will become periodic tenancies at the end of the fixed term. This applies unless the landlord and tenant agree otherwise, the tenant gives notice, or the landlord gives notice using one of the specified reasons.
• Tenants will be able to add minor fittings to their premises where the installation and removal of the fittings is low risk.
• The Regulator will have new compliance tools to take direct action against parties who are not meeting their obligations.
• The penalty amounts will be increased in line with rental increases since 2006, when the penalty amounts were set.
• Soliciting rental bids, for example, by advertising a property without a rental price, will be prohibited.
• The minimum period between rent increases will be raised from six months to twelve months.
• A party who is successful in the Tenancy Tribunal can have their identifying details removed from the Tribunal’s decision. 
• The Tenancy Tribunal will be able to hear cases and make awards up to $100,000 - up from $50,000.

These proposed changes have been sourced from the Ministry of Housing and Urban Development.

If you are unsure about any of these proposed changes or how these may affect you, our team are on hand ready to take your call. Feel free to contact us by requesting a chat with one of our property managers.

Future Dates to keep in mind

Looking past 2020 there are some key dates to keep in mind:

July 1st 2021. By this date, you must ensure that your rental property complies with the Healthy Home Standards within 90 days of a new tenancy. Simply speaking if your current tenant gives notice after this date, you have 90 days to be compliant from the date you sign up a new tenant. Those that use McDonald Real Estate will be well on the road with being compliant before this date, as we'll be working with you to meet the standards between now and July 2021.

July 1st 2024. By this date, all rental homes must comply with the Healthy Homes legislation, without exception. Between 2021 and 2024 the only way that you could get to this date without being compliant is if you have had a long-term tenant for all of this time, which is an unlikely scenario for most.

For more information about the Healthy Homes Act, you can download our guide to 'Healthy Homes Explained' by clicking the download button below. 

Here at McDonald Real Estate, our property managers work hard to make sure all of our managed properties are within the law under the Healthy Homes Act & the Residential Tenancies Act. If you would like to discuss any of the proposed actions we would happy to answer any questions or concerns you may have.