New tenants rights sink landlords

 

IAIN McGREGOR/STUFF
Fixing the rental property could cost its owner upwards of $100,000.

A Newspaper reports that landlords in the Bay of Plenty, where rental property is in chronically short supply, are selling their properties because of ever-increasing tenants rights. This follows on from an article last week where over 900 tenants in Hawkes Bay, including a number of families, enquired after a one bedroom property. quote:

Some landlords are selling up their rental portfolios as the Government looks to introduce tougher regulations that will beef up tenants’ rights.

The Government has a raft of proposals including heating homes, taking away a landlord’s right to say no to pets and axing letting fees but industry experts say it was a knee-jerk reaction and ”catered to a segment of tenants who have had bad experiences”.

Gary Prentice from Rentals BOP said the agency had lost more than 20 properties in the past 12 months as clients sold their rental properties. end quote.

I think the fact that a landlord has no right to say that they refuse pets would be the final straw for me. Yes, I know a lot of pet owners are responsible, but the damage an uncontrolled pet can do is huge. I don’t see why landlords shouldn’t still have some rights over their own properties, and it is, of course, the landlord who picks up the tab for the damage. quote:

He said implementing changes when there was a shortage of rentals was ”crazy”. end quote.

This is not going to stop them though. Nothing is going to stop their ideological march through all of our houses, deciding what we are allowed to do, or think, and to hell with the real world. quote:

”It’s the same deal with most of the landlords, they are saying it’s getting into the too hard basket, and it’s not worth owning rental properties any more, so let the government do it.”

Ultimately, the tenants would foot any costs, Prentice said.

His experience follows that of an Auckland landlord facing a $42,000 bill to repair a damaged rental property – who has questioned whether it’s worth being a property investor under new tenant-friendly Government laws. end quote.

It isn’t. If you are facing a $42,000 repair bill because of a tenant, there is something badly wrong with the system. This type of thing will become more and more prevalent as tenants flex their muscles, knowing the landlord can do nothing about it. quote:

Tauranga Rentals owner Dan Lusby said he had advised landlords that his company could not manage properties if they failed to meet new insulation rules which would kick in on July 1.

Housing conditions needed to improve, he said, but landlords were in for a further shock as heat pumps could be required in main living areas, panel heaters in every bedroom and extractor fans in the bathroom and kitchen, he said. end quote.

All of these proposals help to keep the property warm and dry, but it costs a lot to install these things. Landlords in Auckland, Wellington and ironically probably Tauranga will get their money back on improvements over time, but landlords in small towns will never recover the cost of renovations as rents are still much lower. quote:

Tauranga Property Investors Association president Juli Anne Tolley said she was concerned about a new clause in which landlords had to give a reason when giving a tenant a 90-day notice to vacate a property.

”If you have a tenant situation that is threatening or uncomfortable for neighbours, what do you do?” end quote.

Again, a basic landlord’s right is being taken away. If you own the property, you should have the right to vacant possession when required but now that right is being watered down as well. quote:

Meanwhile in the Coromandel Peninsula, Whangamatā Ray White property manager Trish Morisson said landlords needed to be aware the law was coming down heavily on the side of the tenants and if people do the wrong thing, they can be forced to pay all their rent back or be fined. end quote.

You see, this really gets me. If a landlord does something wrong, he can be penalised heavily. They can be fined for not having insulation installed by July 1st next year, with the fine of up to $4000 going to the tenant. However, a tenant can do $42,000 of damage to a property and nothing happens. quote:

Danny Boeglin, a former Tairua resident who owns 14 flats, units and rental houses was selling them all when the leases end, after 25 years in the business.

“We’ve always looked after people but what the government is doing now is taking the financial freedom away over what we want to do with our money. It’s scary.

“If I drove a $200,000 Lamborghini, I would be nervous letting someone take it, but we are expected to hand our keys over to a tenant, and say ‘I hope it ends on a good note’.” end quote.

I am saving the last word for Lindsay Richards, a landlord from Tauranga who says: quote:

Lindsay Richards has rental properties in Tauranga, Te Puke and Rotorua and he knew ”of a number of landlords who have sold up”.

He said the talk from the government was potentially scary and he had decided not to buy or sell.

”I am going to hang in there and hope some common sense comes out at the end of the day.” end quote.

Don’t hold your breath, Lindsay. Common sense went out of the window in October last year.

 


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Accountant. Boring. Loves tax. Needs to get out more. Loves the environment, but hates the Greens. Has been called a dinosaur. Wears it with pride.

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