Know your rights: What landlords must read before biggest tenancy change in 35 years

Landlords’ rights and obligations change in three weeks, after the former Labour-led coalition Government amended the law to give more security of tenure to tenants in the $180 billion sector.

Some landlords are upset about the February 11 reform, threatening to sell, empty their rentals or screen new tenants more heavily in an attempt to protect themselves and their properties.

“The emotional image of a hard-hearted Victorian property owner with riding crop and jodhpurs willy-nilly casting women and children out into the snow is fictional emotional claptrap,” says landlord Peter Lewis of how his sector is perceived by some.

Nearly 600,000 rental properties are home to 1.5 million tenants, meaning the stakes are extremely high.

Any tweaking to the law causes ripples. And this is no little trickle, more a tsunami.

Information from the Ministry of Housing and Urban Development, Tenancy Services and the Real Estate Institute was collated for this article, to inform landlords about their new obligations and rights.

The Residential Tenancies Amendment Act 2020 limits landlords’ ability to terminate tenancy agreements, giving tenants more confidence that they can stay in the places they rent for longer – but also raising landlords’ fears about their ability to exercise control over their properties.

As a landlord, you are now entitled to 28 days’ notice if your tenant plans to leave, not the previous 21 days.

You can still raise the rent, but you’re limited to every year, not six-monthly as it was under the previous provisions of the Residential Tenancies Act 1986.

You will now be unable to end a tenancy unless it falls under a specific and much narrower framework of reasons. Before you didn’t need to give a reason to ask a tenant to go.

Your intention to sell the place, change its use, move in yourself or move your family in will be one of the grounds for termination – under both the previous law and the amendment. But instead of giving only 42 days when you intend to sell, you now must give 90 days.

If your tenant has been anti-social and you’ve issued three written notices within 90 days, you can apply to the Tenancy Tribunal to seek it to issue an eviction order.

The law’s definition of anti-social behaviour is harassment or any act or omission which reasonably causes alarm, distress or nuisance that is more than minor.

A tenant being five days late with the rent three times within 90 days is another legal grounds for your terminating the tenancy.

In the unthinkable event that your tenant assaults you and charges are laid, you can terminate the tenancy.

You must also now consider a tenant’s application to make minor changes to the place: installing a washing machine, dishwasher, doorbell, security alarms, visual alerts, satellite dish, TV aerial, curtains, shelving, picture hooks, baby gate, internal locks or making a garden all fall under the definition of minor changes.

Your tenant must give you 21 days’ notice to seek your consent and you can refuse if the changes pose a health and safety risk or are seen as more than minor and would present a high risk of damage.

You can also stipulate the tenant returns the place to its original condition before they leave.

Fixed-term tenancy agreements automatically become periodic tenancies when the fixed time, say a year, is over. So it’s not a reason for the tenancy to end – it just continues on the usual tenant-28 days’ notice/landlord 90-days’ notice terms. You can, of course, negotiate another new fixed-term tenancy if you both agree.

You or your property manager must in future specify how much rent you want when you advertise the home. You can no longer ask tenants to make offers. Rent auctions are outlawed.

Tenants can reassign or pass on their lease to new tenants but you get the right to vet the proposed new parties. You can’t withhold agreement unreasonably. You of course can undergo all the same due diligence with the proposed new tenant as with the first tenant.

Gary Lin, an Auckland landlord with 13 rental properties valued at a total $13m, says he uses the service.

He found that an excellent way to check out new tenants when properties were being let. He manages just two of his places, where he has long-term tenants. The other 11 tenancies and properties are managed by property managers.

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