Standards submission questions address fake problems

Anyone who completes the online questionnaire about the proposed extra standards for New Zealand’s 588,700 rental properties will realise that Housing Minister Phil Twyford is trying to solve a problem that largely does not exist.

The additional standards, solely for rental property, that are pitched to solve a health problem, focus on heating, insulation, ventilation, moisture and drainage, and draught-stopping.

There is little evidence that the World Health Organization recommended indoor temperature standard of 18C to 20C has anything to do with health.

Questions about heaters show that there is a need to provide, for the public, and this includes the occupants on New Zealand’s 1.1-million owner-occupied properties as well, useful information on heater performance, energy costs, and health impacts.

Proposals for insulation ignore the fact that the 1978 standard of R2 brought the biggest energy consumption gains and anything over that standard added extra cost for minimal benefit.

A proposal for extractor fans in kitchens and bathrooms overlooks the fact that damp and mould within a dwelling largely results from occupant behaviour and not from the characteristics of the dwelling.

This may be readily proved by the differing impact of different people living in the same house at the same time of the year at different times.

Some houses may have a problem with rising damp in which case a polythene sheet under the floor would be beneficial, but in most cases such sheeting would not be required.

Regulations already require working downpipes connected to the stormwater reticulation system to remove rainwater from properties.

As for draught-proofing, the recommendation that tape should be required around windows and doors with gaps greater that 3mm would capture all timber windows and doors and make double-hung sash windows in operable.

The proposals cite cost-benefit analyses without saying that the costs are on owners and tenants and the benefits are said to accrue to the Government via reduced hospitalisation costs.

There were problems with past cost-benefit analyses associated with heating and insulation and there is a problem with a current cost-benefit analysis in the Healthy Homes Guarantee discussion document with the result that the projected capital cost for heating has been presented as half the likely amount.

What follows is an introduced and edited version of responses submitted via the Ministry’s online survey.

Heating

A BRANZ 2015 House Condition Survey, which found that 22 percent of rental homes have no fixed heating compared to 7 percent of owner-occupied properties, confuses heating being affixed to the property with heating raising the temperature.

Electricity bills from Contact Energy showed that the cost of electricity went from 12.95 cents per kilowatt/hour (before GST) in 2004 to 22.553 cents per kilowatt/hour in 2014. Electricity prices have continued to increase every year since. The high price of electricity means that there is no guarantee that a tenant would ever turn on a large heat pump because they would be terrified of the power bill.

Besides, tests show that portable electric heaters up to 2400 watts reach the 18C standard on the cold days during winter when they are required. If the Government was genuine in its claim that interventions are necessary to improve health outcomes, such interventions would probably be more effective if they targeted those at risk. It is a mistake to assume that all occupants of New Zealand’s 588,700 rental properties are at risk.

It appears that the heat pump industry has had a hand in writing these recommendations because owners may be required to install fixed heating devices (estimate of $3000-$3500 for a heat pump), and there is a suggested ban on electric heaters greater than 2400 watts with the exception of heat pumps. Owners possibly may also be required to provide portable plug-in heaters (estimate of $30-$50). The submission questions and my responses are as follows:

1.1. The survey asks where in the rental home should landlords be required to provide heating. Option 1 – landlord to provide an approved form of heating in the living room(s) only (includes kitchen and dining room if open plan rental home) Option 2 – landlord to provide an approved form of heating in both the living room(s) (includes kitchen and dining rooms if open plan rental home) and bedrooms.

Neither option is necessary if the goal is to provide a so-called healthy temperature of 18C or 20C. That standard is presented as a World Health Organisation standard. However, a closer look to see what evidence the WHO provides to justify those temperatures as “healthy” shows little evidence. The headquarters of the WHO is in Geneva, Switzerland, where apartment living is the norm and apartments are centrally heated. A decision needed to be made on what temperature these buildings should be heated to in the winter. Those temperatures of 18C or 20C were the temperature selected.

The assumption that people are in peril if the temperature slips below 18C is contradicted by the fact that people the world over live and work under a wide range of temperatures, from well below freezing to above 30C.

Having said that, if we assume that 18C or 20C, does a fixed heater necessarily deliver such a temperature? The answer is no. Housing NZ recently provided proof of this when a number of tenants complained that the 2000-watt electric convection panel heaters installed in 15,000 properties failed to make them warm. Tenants resorted to using either electric fan, oil-filled, or radiant heaters that they were accustomed to.

Fixed heaters are not necessary to deliver a temperature of 18C or 20C. A test may be performed by anyone with a thermometer and may be done by closing the windows, curtains, and doors of a room and powering up the heater to raise the room temperature to 18C, which is the “healthy” standard adopted by the Government. Surprisingly, a 2400-watt electric fan heater costing just $30 will heat a State-house living room to the required 18C on a winter night.

Houses may cold during some days in winter. Even so, the sun shines most days and this heats many rooms. The problem is overstated, grossly. The main barrier to people turning on a heater is that they are terrified of the electricity bill, the cost of which doubled between 2004 and 2014.

It is a mistake to assume that if a rental property is let without a heater it will remain unheated. Inexpensive heaters are widely available. Some heating, such as unflued portable gas heaters, brings negative outcomes so there is a case to limit their use. These heaters emit poisons and add 200 millilitres of water vapour to the indoor environment for every kilowatt hour, making dwellings damp.

Having said that, the impact of unflued portable gas heaters depends more on user behaviours than the heaters themselves. I have seen some used effectively by those who ventilate adequately while those who fail to ventilate their dwellings experience negative outcomes.

Are there other areas in the rental home where landlords should be required to provide heating? Again, the answer is no. Portable electric heaters are inexpensive and widely available. Rental accommodation frequently features small rooms, of which one wall would have a door and another a window. Once furniture is added there is not much wall space to install a heater.

1.2 What are the most important considerations in developing an online tool, to help tenants understand and owners comply with providing an adequate heating device under the heating standard?

A more useful online tool would list the range of heaters available, the results of tests in which the length of time it took for heaters to raise the temperature to 18C on a cold winter night when the outside temperature was at 0C, and the cost per kilowatt hour to run the heater.

If the rights and responsibilities of owners and tenants are to be balanced, the phrase “to help tenants understand and owners comply” should be re-written “to help tenants and owners to understand and comply”. I can’t imagine how occupants of any dwelling could be made to comply with a mandatory temperature of 18C on a winter night. Will there be night checks on private dwellings to check compliance. This would be nanny state on steroids.

1.3. What indoor temperature should heating devices be able to achieve? 18C or 20C.

Neither option is necessary. Once it is understood that the so-called WHO “healthy” standard is largely meaningless, there is no need to select a healthy standard of 18C or 20C. Apparently, the temperature selected for McDonalds restaurants is 21C. The temperature in Mitre 10 when I recently bought a thermometer was 18C. Temperature is a matter of personal comfort. Some want to be able to walk around in their underwear on cold winter’s night so they would want a temperature of well over 20C. Others prefer to wear an extra layer of clothing in winter and use minimal heating. It is a matter of personal choice.

1.4. Should owners only be required to provide heating devices where portable electric heaters are insufficient to achieve the required indoor temperature? Option 1 – owners only provide fixed heating devices in cases where portable electric heaters are insufficient to heat the required rooms. Option 2 – owners must provide fixed and portable heating devices to heat the required rooms.

Neither option would be relevant where portable heaters are sufficient to heat the required rooms. Housing NZ has already proved that some fixed heaters have been perceived as inadequate.

1.5. Should we accept some heating devices and not others? Unflued heaters (including unflued gas and kerosene heaters) Open fires All electric heaters (except for heat pumps) with a heating capacity greater than 2.4 kilowatts Using multiple portable electric heaters with a combined heating capacity greater than 2.4 kilowatts in one room.

Unflued gas heaters emit poisons and emit 1 cup of water per kilowatt hour so can be major contributors to indoor damp if used without ventilation. Heat pumps should not have an exemption because they do not necessarily deliver better heat, are no cheaper to run, won’t run when the outdoor temperature falls below 0C, and require a very expensive repair if an insect walks across the mother board and blows it. The only issue with multiple portable electric heaters in a room is if they are run off a single power point. The submission question should be re-written to clarify that point.

Other unacceptable types of heating include turning all elements on the stove on full and opening the oven door because that is a very expensive and inefficient way to heat a home. Gas BBQ burners with an open flame constitute a fire risk.

Should we accept particular heating devices for the heating standard, based on their efficiency, health impacts and affordability to operate?

No. But once the efficiency, health impacts and affordability to operate each heater is displayed then buyers would have a much more informed choice.

All sorts of heaters could be acceptable, including heaters yet to be invented, once the efficiency, health impacts and affordability to operate each heater is displayed. Then buyers could make a much more informed choice.

Insulation

The Healthy homes standards discussion document asserts that many rental homes still do not have adequate insulation to retain heat and therefore are more likely to be cold, damp and mouldy. The document concedes it is based on limited data.

Insulation is used to reduce heat loss in winter and heat gain in summer. In an uninsulated home, about 30-35 percent of heat loss is through the ceiling and roof, and about 12-14 percent is lost through the floor.

Although an insulated dwelling is more pleasant to live in than an uninsulated one, the benefits of insulation are frequently over-stated. Heating is around 30 percent of an energy bill IN WINTER, and insulation reduces annual energy costs only by around five percent. The main consumer of energy in a household is hot water.

There are currently standards that owners of rental property must comply with by July 1, 2019. If ceiling and underfloor insulation was installed in a rental property before July 2016, an upgrade may not be necessary provided the insulation is in reasonable condition and achieved at least the minimum R-value when the insulation was installed, which was, for timber-framed homes, ceiling R 1.9 and underfloor R 0.9.

If there was no existing insulation or it was installed after July 1, 2016, insulation in rentals is required to meet the minimum R-values of the three zones being Northland, the remainder of the North Island excluding the Central Plateau, and the South Island plus the Central Plateau, with ceiling being R 2.9 and underfloor R 1.3.

The price for installing underfloor insulation and topping up ceiling insulation in a 50 square metre dwelling was $2380 in 2018.

The standards discussed in the discussion document could require a higher minimum level of existing insulation than the current regulations and does so without quantifying the additional benefits of a higher grade. The submission questions and my responses are as follows:

2.1. What should be the minimum level of ceiling and underfloor insulation required in rental homes? Option 1 – minimum level for existing insulation akin to the 1978 insulation standard, with any new insulation being installed akin to the 2008 Building Code (current requirements). Option 2 – a higher minimum level of ceiling and underfloor insulation than the current requirements, where the minimum level for existing insulation is akin to the 2001 Building Code and any new insulation is akin to the 2008 Building Code. Option 3 – a higher minimum level of ceiling and underfloor insulation, where the minimum level for both existing AND new insulation is akin to the 2008 Building Code.

Research shows that the 1978 standard for insulation has the greatest energy efficiency gains and underfloor insulation is a waste of money.

Insulation reduces heat loss by about 30-35 percent through the ceiling and roof, and about 12-14 percent through the floor, and can reduce an annual power bill by five percent. But the benefits of insulation have been frequently overstated. A 2011 paper titled “The impact of retrofitted insulation and new heaters on health services utilisation and costs, pharmaceutical costs and mortality”, that claimed that that $1 spent insulating rental properties brings a $2.10 benefit, was used to support the insulation-focussed Residential Tenancies Amendment Bill in 2016. A calculation error in the analysis used to promote insulation was uncovered as submissions got underway. The actual return on $1 spent was just 28c.

The fact is double insulation does double energy consumption savings. Spending on extra insulation is a waste of money. For instance, a graph on insulation presented by NZ Property Investors Federation chief executive Andrew King to the 2018 property investors’ conference showed that R2 ceiling insulation to 1978 standard reduced “relative total heating energy consumption for the same comfort” from 400 percent for an uninsulated ceiling to 110 percent. Yet the additional insulation to the 2008 R2.9 standard only reduced energy consumption by a further 10 percent.

The exceptions set out in the 2016 regulations should continue because it is unreasonable to insist that insulation should be installed when it is not reasonably practicable to install insulation.

2.2. How should ongoing ‘reasonable condition’ of insulation be interpreted? Option 1 – to determine whether any insulation is in a reasonable condition, owners must consider the criteria listed in the discussion document [PDF] (current criteria). Option 2 – insulation must meet the current ‘reasonable condition’ criteria described in the discussion document for option one. However, only a very minimal reduction in insulation thickness (up to and around 10%) is acceptable.

The word “reasonable” means as much as is appropriate or fair. If the 1978 standard achieves the greatest energy efficiency gains, insulation of R3.2 or R2 would have to reduce in thickness well beyond the 10 percent detailed in Option 2. The criteria of no gaps, degradation that meets guidance thresholds, no dampness detailed in Option 1 would be reasonable.

2.3. Do you agree owners should show compliance with the insulation standard by retaining particular records?

A requirement for owners to should show compliance with the insulation standard by retaining particular records is not reasonable. I have been installing insulation over a 28-year period. The legal requirement for retaining documents is seven years. Those documents are long gone. Even though I went above and beyond legal requirements on insulation, in the absence of those invoices I would still be deemed no-compliant

Ventilation

It is not as if there are no regulations for housing. The Housing Improvement Regulations of 1947 required opening windows in bathrooms and ventilation in kitchen. Much of this was incorporated into the Residential Tenancies Act 1986 and remained uncontroversial until rental housing became politicised since 2008. Opening windows and doors is the usual way of ventilating a dwelling. The discussion document is silent on why some housing more than 100 years old had no problems with dampness until the past 10 years.

The discussion document cites a BRANZ report that says bathrooms without extractor fans or heating are twice as likely to have moderate or worse patches of mould compared with bathrooms with extractor fans or heating. It also asserts that 37 percent of rental homes have no extractor fans in the kitchen, and 44 percent have none in the bathroom.

The writers of the discussion document appear unaware that some tenants won’t use extractors because they use electricity and sometimes prefer to shower in the dark, with windows and doors firmly shut.

The document cites an NZIER report that said costs outweigh the benefits of installing ventilation equipment in rental properties. The submission questions are as follows:

To be quite clear, with the exception of dwellings where stormwater is not removed from the section and where there is a leaky roof, the build-up of mould results from how people live in houses and not the houses themselves. This may be tested by leaving the property vacant.

For instance, I have a four-bedroom house that was turned into a mouldy wreck by one family, yet the next family has lived there for years with no problem. The house has ceiling insulation and has a log-burner in the lounge. I have a flat, insulated in the ceiling, that tended to have a build-up of mould on the south wall. Yet one family lived there for three years and the condition they left it in was identical to how it was when they moved in. (The flat had been painted throughout when they moved in.) I have a nine-flat property with extractor fans in kitchen and bathroom.  The flats are mainly identical. I have had problems with mould in some flats at some times by some people. Different tenants in a flat that has had a mould problem currently live there without mould or condensation issues.

Dry heat produced by electric heaters or fires is preferable. The use of unflued portable gas heaters which produce 1 cup of water for every kilowatt hour greatly increase the amount of vapour within dwellings. Such heaters, plus showering, plus cooking, produce condensation that needs to be wiped away every morning and homes ventilated every day by opening windows and doors. Having said that, I have tenants who use portable gas heaters effectively without generating mould simply because they ventilate the property, mainly by leaving the main ranch-slider door partly open during the day when at home.

Large-scale immigration brought hundreds of thousands of people from warm climates who try to recreate equatorial temperatures with portable gas heaters without ventilating properties. There also appears to be an increase in locals who know nothing about the need to ventilate. The submission questions and my responses are as follows:

3.1. Which of the options do you support to provide adequate ventilation in rental homes? Option 1 – landlords continue to meet the requirements of the Building Code, Residential Tenancies Act and the Housing Improvement Regulations (current requirements). Option 2 – extractor fans installed in rooms with a bath or shower. Living rooms, dining rooms, kitchens and bedrooms have windows that can be opened for the entry of air. Option 3 – extractor fans installed in rooms with bath or shower or indoor cooktop. Living rooms, dining rooms, kitchens and bathrooms have windows that can be opened for the entry of air.

Option 1, which is based on the requirements of the Residential Tenancies Act and the Housing Improvement Regulations 1947, only requires opening windows in a bathroom and a toilet. I have installed extractor fans in some bathrooms and kitchens which help to a certain extent. The best ventilation is if the dwelling occupant opens windows and doors every day and wipes up condensation. Mould that results from lack of ventilation generally results from how the occupant lives in the house and is not to do with the house itself.

Shower domes are another way of minimising the spread of water vapour while someone is showering. However, these are not suitable for all bathrooms.

I agree that exemptions should be available for certain rental homes from requiring openable windows. Multi-floor apartment buildings in many cases cannot have opening windows.

Moisture and drainage

The discussion document observes that moisture entering a home from outside often contributes to damp and mould issues inside the home in addition to moisture created by everyday occupant activities like cooking and showering.

Rising damp resulting from lack of ventilation under the floor, leaks through holes in the roof, blocked gutters, downpipes, stormwater systems, and failed waterproofing under concrete floors can all contribute to damp homes.

The discussion document assumes that because rental homes are damp and mouldy if nothing is done they will all continue to live in them and the Government would face escalating hospitalisation costs.

There is an attempt to quantify this in the discussion document by saying up to 40 litres of water can rise up from the ground below a 100 square metre home every day, that 76 percent of rental homes have a subfloor, that 44 percent of rental homes with subfloors have insufficient ventilation, and that 81 percent of rental homes with subfloors do not have a ground moisture barrier. No source for this information was provided. Elsewhere in the document was a concession that data on rental properties on which to base such assertions is limited. The submission questions and my responses are as follows:

4.1. How should owners protect against moisture entering the rental home and inadequate drainage? My preferred option is Option 1, where owners continue to meet the current requirements of the Building Code, Residential Tenancies Act and the Housing Improvement Regulations. Insulation installers are pushing Option 2, which says landlords provide efficient drainage, guttering, downpipes and drains, and ensure that the subfloor has a ground moisture barrier (unless there is already adequate subfloor ventilation). These polythene sheets look good at first but soon get disturbed by animals and by tenants pushing rubbish under houses. Water gets spread far and wide when plumbers drain hot water cylinders to replace them.

I disagree with a proposal that an owner obtains a certificate from a qualified building surveyor to show that their rental home complies with the standard because this would merely create a financial cost to me while giving a financial benefit to a building surveyor while making no improvement to the quality of the dwelling.

Draught stopping

The Healthy homes standards discussion document says New Zealand rental homes are draughty, particularly those built before 1960, without noting that all housing in New Zealand from that era is potentially draughty. Neither does it note that draughts provide ventilation although on a cold winter night it is unwelcome ventilation.

5.1. Which of the options do you support as the appropriate level of draught stopping to create warm and dry rental homes? Option 1 – owners continue to meet the requirements of the Building Code, Residential Tenancies Act and the Housing Improvement Regulations (current requirements). Option 2 – owners to stop any unnecessary gaps or holes that cause noticeable draughts and a colder rental home (see the discussion document for specific requirements [PDF]), and block any decommissioned chimneys and fireplaces.

The proposal to require draught-stopping tape where there are gaps around windows and doors of greater than 3mm is absurd to the nth degree. That would require tape around every timber window and door. The proposal would make double-hung sash windows inoperable. The tape would have to be peeled off and the sticky part removed for repainting and then replace. I have rarely had anyone complain about draughts. I have rarely had anyone install draught-proofing tape. Most people know what to do if there is a draught.

Date to comply with the standards

The survey presents three options: Option 1 – owners must comply with the standards within 90 days of the start or renewal of a tenancy, coming into effect after a certain date (e.g. 1 July 2021). Option 2 – a single date is chosen for when all owners must comply with all standards (e.g. by July 2022). Option 3 – the compliance dates are staggered over 5 years, either by the standard or rental home location.

My preference is Option 4, which is to set standards and have no compliance date.

Records

7.1. What records should an owner retain to show compliance with each healthy home standard?

Prospective tenants have shown no interest in looking at compliance documents. Perhaps the Minister does not realise that heating, insulation, ventilation, damp-proofing, and draught-stopping is not an issue for most tenants. I find some people confused as to why they should have to sign the insulation statement required in tenancy agreements. I have to explain what insulation is, and how it works, and how it is better in the ceiling.

What tenants want is a home and affordable accommodation is in short supply. These additional standards do nothing to increase the supply of affordable accommodation. They just add extra costs on existing accommodation. As a result, right now, rental property owners are selling to first home buyers, further reducing the supply of rental accommodation and increasing rents.

Any issues with the condition of housing may be taken to the Tenancy Tribunal and dealt with forthwith. That is where evidence of compliance may be proved. In the past financial year. Tenancy Services does not collect information on complaints about insulation.

A recent information request showed no complaints by tenants related to heating, ventilation, rising damp, or draughts. I’m suspect that there were such complaints but the number is probably statistically insignificant. There were 35,581 applications to the tribunal over the past financial year with 25,329 of those by owners over rent arrears. This number comprised 72 percent of total applications.

As I already wrote, prospective tenants have shown no interest in looking at compliance documents. Perhaps the Minister does not realise that heating, insulation, ventilation, damp-proofing, and draught-stopping is not an issue for most tenants. Adding details about insulation, heating, ventilation, rising damp and draught-proofing to tenancy agreements is ridiculous.

General questions

8.1. Do you agree with the assumptions and analysis in the document for the indicative costs and benefits, and our analysis of the advantages and disadvantages?

 

No. The cost-benefit indicators fail to make it clear that the costs are on owners and tenants and the benefits accrue to the Government by way of claimed reduced hospitalisation costs. There appears to be an error in the NZIER cost-benefit analysis as shown on tables 4 and 8 to do with heating. It looks like the projected capital cost would be $900-million, not $450-million. We need more time to analyse the assumptions. No extra time appeared forthcoming. We will do that analysis anyway and publish our results.

8.2. Is there anything that is significant that we haven’t considered?

The significant issue that you haven’t considered is that what tenants want is a home and affordable accommodation is in short supply. These additional standards do nothing to increase the supply of affordable accommodation. They just add extra costs on existing accommodation. As a result right now rental property owners are selling to first home buyers, further reducing the supply of rental accommodation and increasing rents.

Links

The Healthy Homes Standards Discussion document may be downloaded here.

You may email your submission to Healthyhomes@mbie.govt.nz

The Ministry of Housing and Urban Development online submission is available here.

Submission author

Mike Butler

Stop the War on Tenancies spokesman

October 22, 2018

Download this document here: MB submission standards