Landlord group claims property investors 'treated as scapegoats for years'

Landlord group claims property investors 'treated as scapegoats for years'
Photo credit: Getty Images

A landlord group has claimed property investors have been treated as scapegoats "for years".

It comes as tenants brace for higher rents from September 26, which is when the Government-imposed freeze on rent increases comes to an end. But landlords were warned by the Commerce Commission last month they could be at-risk of cartel-like behaviour after they used online forums to discuss raising rents en masse once the freeze ends.

Stop the War on Tenancies spokesperson Mike Butler said rental property owners should have their property rights restored, which he said includes rent paid as agreed, respectful behaviour from tenants and the right to end tenancies if landlords choose.

New changes made under the Residential Tenancies Act that kick in next year in Feburary, mean if rent is late at least five working days three times within 90 days, an application can be made to evict tenants, and landlords cannot evict tenants without reason and they instead require "specific grounds". Tenants are still liable under law to pay for any damage they make as a result of careless behaviour.

Another change that came into effect is rent increases are now limited to once every 12 months. Previously, landlords could increase rent once every 180 days.

Tenants are now fearing their rents may be hiked once the freeze comes to an end, but others have already been served notices of their increase.

Zoe - which isn't her real name - rents a one-bedroom studio in Wellington and has been told her rent will increase by $40 to $370 a week.

"I was devastated, obviously, because $330 is already a lot, and it was on the precipice of me not being able to pay even that," she told RNZ.

She responded to the notice by asking her landlord to reconsider the increase, since her disability benefit - which is her whole weekly income - barely covers rent and her unit is damp and mouldy.

"It's kind of evil, honestly and it's very cynical that they've done it as soon as they possibly could," she said.

Landlord group claims property investors 'treated as scapegoats for years'
Photo credit: Getty Images

But Butler said if a tenant "goes off the rails", the "red tape" surrounding the Tenancy Tribunal means it could take "months to resolve, if at all".

"The regulations on insulation, heating, ventilation, and moisture would function better as guidelines rather than excuses for massive fines against landlords."

Butler said he welcomes the ACT Party's promise - which was announced earlier in September - to reverse this year's Residential Tenancies Act changes and temporarily prohibit new regulations.

ACT leader David Seymour said at the time he'd seen "stupid policy" before, but it was "hard to exaggerate the stupidity" of the recent Residential Tenancies Act changes.

"They've directly disadvantaged the very people they were trying to help. We need to stop the stampede of landlords leaving the residential tenancy market," Seymour said.

Butler said residential rental property owners need to "defend their property rights".

"ACT joins the National Party in offering relief for rental property owners who have been treated as scapegoats for years," Butler said.

"Labour policy adds nothing to its changes to residential tenancy law and standards. Neither does it boast about it. Labour prefers to promise 8000 more public and transitional housing units and work on its homelessness action plan."

In February when the Residential Tenancies Amendment Bill was passing through Parliament, the Ministry of Housing and Urban Development said the changes would not hit landlords with "material direct costs", but they're "likely to face additional administrative costs in relation to new processes around minor fittings and assignment of fixed-term tenancies".

"Some landlords may generally consider that the package of tenancy initiatives will increase the risk to their business and this could affect landlord willingness to rent, and the amount of rent charged," it said.

"However, noting that there are a wide number of factors that affect rent, it would be difficult to attribute any change in market rent to the reforms alone and any impacts on rents may be muted by other factors that reduce costs for landlords, such as lower interest rates."

Associate Housing Minister Kris Faafoi also said at the time the changes build on "gains we have already made to ensure that rental properties are warm, dry and safe".

"They will provide a higher level of security to tenants, and ensure that landlords continue to have the tools they need to manage their assets and provide a high quality of service to their tenants."