Changes to RTA
This means there will be a number of new changes in Legislation Residential Tenancies Amendment Act 2020 (RTA). Some of this has already come into effect and more of the new changes are set to take place on February 11th 2021 which will affect both tenants and landlords.
Government has made these changes to adapt the Tenancy Law Act to the market needs. It has remained unchanged since 1986 and has been long overdue. Since the RTA came into force, home ownership rates have declined and the proportion of households living in the rental market has increased. Statistics New Zealand indicate that 1 in every 3 Kiwi household now rent. These new laws reflect the current day renting situation in New Zealand. The legislative changes aim is to increase the security of tenure for rental customers, as well as provide homes that they treat as their own. The aim is also to create more stable prices in an increasingly competitive rental market.
Our view on this is to focus on guiding our Landlords through this process with education and ensuring your properties meet compliance with the new requirements. Below are the new changes in Legislation,
From 11 February 2021:
• Security of rental tenure: Landlords will not be able to end a periodic tenancy without cause by providing 90 days’ notice. New termination grounds will be available to landlords under a periodic tenancy and the required notice periods have changed.
• Changes for fixed-term tenancies: All fixed-term tenancy agreements will convert to periodic tenancies at the end of the fixed-term unless the parties agree otherwise, the tenant gives a 28-day notice, or the landlord gives notice in accordance with the termination grounds for periodic tenancies.
• Minor changes: Tenants can ask to make changes to the property and landlords must not decline if the change is minor. Landlords must respond to a tenant’s request to make a change within 21 days.
• Rent bidding prohibited: Rental properties cannot be advertised without a rental price listed, and landlords cannot invite or encourage tenants to bid on the rental (pay more than the advertised rent amount).
• Fibre broadband: Tenants can request to install fibre broadband, and landlords must agree if it can be installed at no cost to them, unless specific exemptions apply.
• Privacy and access to justice: A suppression order can remove names and identifying details from published Tenancy Tribunal decisions if a party who has applied for a suppression order is wholly or substantially successful, or if this is in the interests of the parties and the public interest.
• Assignment of tenancies: All requests to assign a tenancy must be considered. Landlords cannot decline unreasonably. If a residential tenancy agreement prohibits assignment, it is of no effect.
• Landlord records: Not providing a tenancy agreement in writing will be an unlawful act and landlords will need to retain and provide new types of information.
• Enforcement measures strengthened: The Regulator (MBIE) will have new measures to take action against parties who are not meeting their obligations.
• Tenancy Tribunal jurisdiction changes: The Tenancy Tribunal can hear cases and make awards up to $100,000 (which is up from $50,000).
Also, the provisions, which were introduced in a last-minute Supplementary Order Paper during the final debate over the legislation, must come into effect by 12 months after the day of Royal Assent (11 August 2021). However, they may come in earlier if the Government agrees.
Those provisions are that:
• A landlord will be able to issue a 14-day notice to terminate the tenancy if the police have charged the tenant with assault of the landlord, a member of the landlord’s family, or the landlord’s agent.
• A victim of family violence will be able to withdraw from a tenancy without financial penalty.
DO remember, the security of rental tenure is a positive for both sides; tenants get a feeling of security, and landlords have good tenants in place hopefully for the long-term.
Remember we’re here to help, should you have any questions around the new legislation.