After almost two years since the controversial tenancy law reform has been announced, the new law has passed and certainly re-wrote the rules for NZ landlords.
The major reforms contained in the Bill would:
Remove 90-day no-cause terminations
Landlords will not be able to end a periodic tenancy without reason making it more difficult and time-consuming for landlords to remove problematic tenants. The list of approved reasons for terminating tenancies under the RTA will include:
Tenants are 21-days behind on rent (application to the Tenancy Tribunal)
Repeated rent arrears. Tenants have been over 5 days behind on rent at least 3 times in a 90-day period (application to the Tenancy Tribunal)
Repeated anti-social behaviour. Tenants displayed anti-social behaviour at least 3 times in a 90-day period (application to the Tenancy Tribunal)
Hardship relief (application to the Tenancy Tribunal)
The property owner or a family member is moving into the property (63-day notice)
The landlord's employee needs to use the premises (63-day notice)
The property has been put for sale (90-day notice, which has been extended from 42 days)
The property was sold, and the new owner wants to move in (90-day notice)
The landlord is planning to conduct extensive alternations, repairs or redevelopment of the property making it impracticable for tenants to continue living on the premises (90-day notice)
The property is going to be demolished (90-day notice)
The property is to be used for commercial purposes or was acquired to facilitate the use of nearby land for commercial purposes (90-day notice)
Require that fixed-term tenancies automatically converting to periodic on expiry unless both parties agree that the tenancy will end
If the landlord doesn't want to continue with the tenancy, then they must use one of the grounds specified above to end the tenancy. If the tenant doesn't want the tenancy to continue, they can give notice between 28 days and 90 days before the end of the fixed term period.
Ban rent bidding
The landlords will not be able to invite or encourage tenants to bid on the rental (pay more than the advertised rent amount). Advertising a property without a rental price will be prohibited.
Limit rent increases to once a year
The minimum period between rent increases will now be twelve months as opposed to every six months.
Allow tenants to make minor alterations to a rental property
Landlords will be required in most instances to permit the installation of ultra-fast broadband and allow other minor alterations to houses such as baby-proofing, hanging pictures, and earthquake proofing.
Allow tenants to request assigning a tenancy to someone else
All requests to assign a tenancy (including fixed-term tenancy) must be considered. Landlords cannot decline unreasonably. If a residential tenancy agreement prohibits assignment, it will be of no effect.
These are big changes that certainly will affect both tenants and landlords.
The bulk of the reforms will come into effect in six months on 11th February 2021 to give tenants and landlords time to prepare for the new rules. But the 12-monthly limit on rent increases has come into effect as of 12th August 2020 in a bid to help tenants who are struggling financially as a result of Covid-19.
The information contained in this article is exclusively for promotional purposes. It does not in any way constitute legal advice and should not be relied upon as the basis for any legal action or contractual dealings. The information is not and does not attempt to be, a comprehensive account of the relevant law in New Zealand. If you require legal advice, you should seek independent legal counsel. myRent.co.nz does not accept any liability that may arise from the use of this information.