David Whitburn

The Residential Tenancies Act 1986 was been amended with its third and final reading passing in Parliament yesterday (20 July 2010).  It will shortly receive the Royal Assent from the Governor General Sir Anand Satyanand to make this law.  I think that this is good legislation for residential landlords in that it brings in a new concepts of “unlawful acts”.  These unlawful acts also carry fines, and include:

• failure to leave the premises (when the tenancy is over)
• using the premises for an unlawful purpose (eg. P-lab, gang house, brothel, significant business etc)
• harassment of other tenants or neighbours
• exceeding the maximum number of persons
• abandonment of premises

Previous draft legislation included having tenant advocates (a bit of a nightmare in Australia where tenants had skilled legally trained representatives making a landlords life extremely tough), having to disclose if a property had previously been a P-lab (deemed unnecessary since a Cleansing Order and rigorous investigation was required to ensure that the house was suitable for habitation), and proposing to limit tenants liability for damage – including willful and reckless damage to 4 weeks rent.  This is great as these would have been a significant risk and skew the balance of power to tenants in the Landlord – Tenant relationship.

Full Announcement from Phil Heatley – Minister of Housing:

Changes to the Residential Tenancies Act passed by Parliament today will better meet the needs of landlords and tenants in today’s rental market, Housing Minister Phil Heatley says.

The changes to the Act include clearing up confusing processes around terminating and renewing tenancies, and introducing new financial penalties for tenants harassing neighbours of up to $2,000, or for landlords providing sub-standard housing of up to $3,000.

“These changes respond to significant change in the residential renting market since the first Act’s inception in 1986,” Mr Heatley says.

The Act has also been extended to cover boarding houses. This means that tenants who have never had any protection or certainty of week to week accommodation will now have access to the full range of tenancy services.

“Boarding house landlords will now generally be required to give tenants 28 days notice that a tenancy is being terminated. The Tenancy Tribunal will also be able to order boarding house landlords to carry out necessary repairs or maintenance,” Mr Heatley says.

“Over recent years, the private rental market has been increasingly important in housing those who choose, or need, to rent their homes for lifestyle or affordability reasons.

“It is therefore imperative the legislation governing the sector supports adequate provision of stable, good quality rental housing,” he says.

Key changes to the Act include:

• Clearer and fairer processes for terminating and renewing tenancies, including clarifying what happens when a fixed-term tenancy expires and the process for terminating a tenancy due to non-payment of rent and other breaches;
• Measures to encourage landlords and tenants to comply with their obligations under the Act;
• Enhancements to dispute resolution, including increasing the monetary jurisdiction of the Tenancy Tribunal from $12,000 to $50,000, so that most tenancy disputes can be resolved quickly, fairly and cost effectively;
• Improvements to the enforceability of Tenancy Tribunal orders.

The new laws will come into force later this year once supporting regulations have been approved and published.

For more information, visit the Department of Building and Housing website at www.dbh.govt.nz/rta-review or phone 0800 TENANCY (0800 836 262).

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