Will the Nats correct Labour’s rental property errors?

Will the National Party under Judith Collins vote against Labour’s flawed proposed amendments to residential rental tenancy law and correct the rules and penalties to do with rental property standards, Tenancies War spokesman Mike Butler asked today.

The Labour-led Government is trying to push through changes to the Residential Tenancies Act which would mean that:

  1. Rent arrears debts will become larger, and will take longer and become more difficult to resolve.
  2. Noisy, disruptive behaviour becomes much more difficult to manage, creating a problem for owners and neighbours.
  3. Owners won’t be able to end a tenancy except by selling it or moving into the property.

“Will Ms Collins make a commitment that the National Party would vote against residential tenancy law changes when the bill returns to Parliament after scrutiny by the Social Services and Community Select Committee,” Mr Butler asked.

“In addition, would a National-led government revisit the so-called healthy homes regulations that have turned the business of renting into a nightmare of costly compliance,” he asked.

“Seventy three of the 87 proposed penalties target owners and the fine for owners for not complying with the healthy homes standards is $7200,” Mr Butler said.

“Standards are fine but the requirement to re-insulate beyond that required in 2016 is all cost and little benefit and the heating assessment tool (on the Tenancy Services website) is flawed,” he said.

“The whopping fines and the unnecessary extra insulation should be dropped, the heating tool should be amended to correct its flaws, and the standards should be recommendations rather than punishable rules,” Mr Butler said.

“The proposed amendments to tenancy law plus the Draconian penalties linked to housing standards are driving many residential rental property owners to sell,” he said.

“Labour policies are reducing the supply of rental property at a time when tens of thousands are looking for a home to rent,” Mr Butler said.

“New Zealand’s 290,000 rental property owners need to know where the National Party stands as we prepare to vote on September 19,” he said.

Stop the War on Tenancies is a group that since October 2018 has been highlighting the failure by the Government to create sound policy and law for residential rental property. Much policy has only increased rents and disadvantaged both tenants and owners.

Hopefully pragmatism will replace Twyford’s agendas

Tenants and owners may hope that some pressure may have gone now that Phil Twyford is no longer Housing Minister, paying the price for the political embarrassment that KiwiBuild became, Tenancies War spokesman Mike Butler said today.

His tinkering with rental property standards and tenancy law helped hike rents and drove a number to sell, creating a new housing crisis, Mr Butler said.

Insulation standards based on optimum costs and benefits had already been set by the previous government and Mr Twyford’s requirement for additional insulation would incur extra costs for little extra benefit, he said.

Requiring a fixed heater makes little sense when there is a wide range of affordable heaters that tenants already use to suit their needs, he said.

Installing extractor fans, which are costly, difficult to install, or have an opening window in the way, is in many cases a waste of money. Properties may be ventilated by opening windows.

The $200 million Mr Twyford allocated to the charity Housing First to house 1000 people over four years at a cost of $961 per person per week, relies on leasing properties from the private sector that have been difficult to find, Mr Butler said.

Mr Twyford’s somewhat desperate “build-to-rent” proposal would require substantial Government financial support and guarantees to get off the ground, just like the failed KiwiBuild programme, and would mean high-density, large apartment blocks that most likely would end up as ghettos, he said.

Whether the new Housing Minister, Megan Woods, is pragmatic or agenda-based remains to be seen, Mr Butler said.

The decider will be whether she proceeds with tinkering with the Residential Tenancies Act that would end the contractual rights of owners to end tenancies, and remove the ability to sell with vacant possession, as Housing New Zealand requires when buying properties from private owners, he said.

Stop the War on Tenancies is a group that since last October has been highlighting the errors made by successive governments while creating rental property policy.

See CHB 86-year-old moves out https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12238724

See Housing shortage first hurdle, https://i.stuff.co.nz/business/property/105735200/housing-shortage-first-hurdle-as-housing-first-moves-to-marlborough

The crisis the Housing Minister created

A report yesterday of a woman, 86, moving because of a 73 percent rent hike illustrates the crisis created by Housing Minister Phil Twyford, Tenancies War spokesman Mike Butler said today.

This story of a property being sold with the new owner hiking rent from $150 a week to $260 provides evidence of the consequences of Mr Twyford’s agenda that he refused to accept – that owners would sell and rents would rise.

The new owner said that the property needed work to be brought into line with the “healthy homes” standards, which was something he “supported”.

The new owner phrased his comment as if he had a choice, Mr Butler said.

In fact, rental property owners have no choice. They either comply with the standards that were imposed by regulation and include penalties of up to $200,000 for non-compliance, or sell, he said.

The out-going tenant did not say whether or not her flat was cold and damp, as the Minister alleged all rental properties were. Her only objection was the rent hike, Mr Butler said.

The property looks like a 1970s construction which may already comply with the 1978 insulation standard which achieves the greatest heat-loss prevention, he said.

The main justification for Mr Twyford’s standards was to prevent the hospitalisation each year of 6000 children for housing-sensitive illnesses.

As a one-bedroom flat, the flat under discussion would be unsuitable for children; this illustrates the short-sightedness of setting requirements for 588,700 properties for the supposed benefit of 6000, Mr Butler said.

Mr Twyford has created a new housing crisis and now both owners and tenants are paying the price, Mr Butler said.

Stop the War on Tenancies is a group that since last October has been highlighting the evidence that successive governments have ignored while creating rental property policy.

See CHB 86-year-old moves out https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12238724

Build-to-rent another expense for taxpayers

If Housing Minister Phil Twyford could do a few basic calculations, he would know that the “build-to-rent” proposal he is looking at would require substantial Government financial support and guarantees to get off the ground, Tenancies War spokesman Mike Butler said today.

Mr Twyford on Wednesday proposed encouraging more build-to-rent developments, involving Crown land, to be run as private rentals, and to serve as high-quality longer-term rental stock.

He has acknowledged the need for more rental property but apparently does not want the Mum-and-Dad taxpayers who own most of New Zealand’s 588,700 rental properties to do it, Mr Butler said.

Smaller rental property owners are adding more stock by way of infill housing but the high cost of land makes larger developments unviable, he said.

For instance, total annual upper-quartile rent on a 600-square-metre development of six two-bedroom flats in Hastings would be $109,200, according to market rent data lodged with Tenancy Services.

The cost to build at a national average of $2000 per square metre would be $1.2-million. The cost of land may be $700,000 for 1000 square metres.

Interest payments on a $1.2-million loan at 5 percent are $60,000 a year, which leaves $35,397 to pay for land, as well as fees and permits, administration costs, ground work, a BRANZ levy, and development contributions, as well as annual running costs of $8654 for rates and $5149 for insurance, plus repairs, plus costs of changing any tenancy.

This is all before any payments towards reducing the substantial debt without any margin for an increase in interest rates.

In other words, Mr Twyford’s proposal is not viable without substantial top-ups with taxpayer money, Mr Butler said.

Expensive rental property standards, tinkering with tenancy law, ring-fencing of rental property losses, and the end of letting fees have reduced rental property supply and hiked rents, he said.

Mr Twyford’s government has damaged a rental property system that operates largely without cost to the government and with a benefit to the government of tax revenue, Mr Butler said.

Irrationally, Mr Twyford appears to want to replace that low-cost fully functioning model with a high-cost new model that relies on financial support for the government, Mr Butler said.

Stop the War on Tenancies is a group that since last October has been highlighting the evidence that successive governments have ignored while creating rental property policy.

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