11th February 2021 a number of new legislative requirements came in for all new tenancies and periodic tenancies. Some parties believe that the changes are onerous on Landlords, but here at Point Property we will manage the changes to be as much a positive to our Landlords as we can.
- Fixed term tenancies that commencing prior to 11th Feb 2021 are still covered by the previous legislation.
- Ending a tenancy – There are no ‘No cause 90-day terminations’. This is not an issue for us at Point as we very rarely saw the need to use this clause. For us, we try to concentrate on getting the right tenant for you in the first place.
- Arrears – We can still terminate a tenant for arrears of more than 21 days, but we have the bonus of the new ‘three-strike policy’. This means that a tribunal application can be made to terminate the tenancy if the tenant is in arrears for more than five business days, three times in a ninety-day period. We need to ensure the correct notices are given each time, but this is great news. In the past we have experienced tenants paying up there arrears just before the court hearing and continuing to use the Landlord as their bank.
- Anti-social behaviour: noise, abusive or threatening behaviour – There is also a three-strike policy for anti-social behaviour, with the correct notices from the Police and noise-control.
- Property owner wants to move back into the property – Notice to the tenant has increased from 42 days to 63 days for a periodic tenancy, a fixed term remains in place for the term.
- Property on the market – The tenant needs to be advised in writing prior to the property going on the market. If the tenant is on a periodic lease, you can give a tenant 90 days’ notice to vacate if you wish to market the property vacant.
- Property sold – From the date of an unconditional contract, you can give the tenant 90 days’ notice to vacate.
- Family violence – Sadly family violence is on the increase in New Zealand and the new laws allow the tenant to give two days’ notice to vacate. This law is a positive as often we see tenants abandoning properties due violence and the need for us to apply to the court for possession with often big clean-up costs.
- Tenancy terms – All fixed term tenancies will automatically convert to periodic tenancies unless both parties agree. A longer-term tenancy can be negotiated if it suits both parties.
- Notice period – Tenants now need to give 28 days’ notice to vacate on a periodic tenancy, rather than the previous 21 days’ notice.
- Changes to a tenant – A Landlord cannot hold their consent unreasonably for a change of Tenant or a transfer of the tenancy.
- Rent increases – A rent increase notice can only be issued every 12 months for the same tenancy. We see this is a positive as a lot of property managers were only giving token increases of $5 or $10 every six months, whereby given good market research the 12-month increase can be substantial.
- Advertising – All properties must be advertised with a price, including rental signboards.
- Rental bidding – Rental bidding cannot be encouraged, whereby the tenant pays more than the advertised price.
- Tenant changes to the property – All Tenants requests to make minor changes to the property must be considered. There is also a ‘make-good’ clause at the end of the tenancy if required by the Landlord.
Landlord Breach Penalties
The Tenancy Tribunal now has the power to make awards of up to $100,000 for Landlord or Tenant Breaches. An itemised list of fines is available on the Tenancy Services Website https://www.tenancy.govt.nz/.
At Point Property, our mantra has always been ‘if you look after your tenants, they will look after you’. If you keep your rental properties in a reasonable condition and comply with legislation, you will not be concerned.
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