King calls for talks with Ministers over ‘bombshell’ DBH plans

Friday 16 March 2012

UPDATE: New Zealand Property Investors Federation (NZPIF) president Andrew King plans urgent talks with Government Ministers to get answers about the proposed merger of the Department of Building and Housing (DBH).

By The Landlord

"I am very shocked. It came out of left field. I have not got a clue what building and housing has to do with business and innovation or labour," King said.

Cabinet had agreed in principle to establish the new Ministry, which will absorb the functions of the Ministry of Economic Development, the Department of Labour, the Ministry of Science and Innovation, and the Department of Building and Housing effective by July 1.

He is trying to get appointments to see Steven Joyce, who will head the new ‘super ministry' and Housing Minister Phil Heatley and building Minister Maurice Williamson.

"We will definitely be trying to go and see the Ministers. We need to know what will happen with services, especially tenancy services. We want to talk to Ministers to find out what is going on.

"We should have been consulted. I do not think it is acceptable. They have not gone out to the stakeholders and asked us what would happen if we changed this or that or asked us what needed changing. There has been none of this. It is a bombshell."

Even if the proposed merger wasn't going ahead King had planned to talk to Ministers. Since the last round of cost cutting in the Department services, that were excellent, had diminished, he said.

The main problem was the waiting times for tenancy tribunal hearings that had ballooned out to seven weeks and in some centres like Auckland, Wellington or Christchurch that could be even longer, King said.

Previously landlords might have waited up to three weeks for a hearing. With the average rent being $330 a week, and more in the main centres, landlords were losing an extra $1350 before they got to a hearing.

"We are going to say to them (the Ministers) we are really concerned that this is going to further deteriorate a service that is already failing. How can we stop it from going down and get it back to where it was?"

At a bare minimum King said investors needed services to be returned to how they were several years ago, before the review, when the service was excellent.

"This announcement (the proposed merger) makes us more concerned that that will not happen," he said.

Unlike Auckland Property Investors Association (APIA) president David Whitburn who states on his blog that he likes the big picture of the merger because it will keep Government expenditure under control and is "excited by the change, and with these timeframes ballooning over the past year to unacceptable levels, change had to occur."

King is not convinced.  He was not excited by the merger and did not think it would improve service.

"I don't think service will improve, especially given the last time they went through a review to improve customer services it ended up with customer service going down. I have no expectation it is going to improve the service."

He was concerned that Government seemed to have made up its mind about the merger and was not going to go back on it.

Comments from our readers

On 16 March 2012 at 11:41 pm Terry & Ali Goodall said:
Go Andrew! Thanks for taking this on. We are also very dubious about the direction this "reform" is taking, and do NOT share David's optimistic enthusiasm. What are they thinking of? Oh yes, of course - trying to trim $$$ - it will backfire, and end up with ever more costly implications and consequences.
On 17 March 2012 at 8:36 am Barry said:
I am also concerned at the existing deterioration in tenancy services timelines. Restructuring what is a simple adjudication will not help. Just another increase in risk for being a landlord from the government that thinks it understands business.
Commenting is closed

House Prices

No stopping Capital price rises

There’s no sign of a slow-down in Wellington’s property prices with Trade Me Property’s latest data showing that asking prices continue to rise solidly.

Commercial

Demand challenges for commercial sector

Vacancy rates in the commercial property sector are set to increase as changing economic conditions dampen demand.

Mortgages

Mortgage rates may be at cycle low: ASB

Take note, investors: It is "quite possible" fixed rate mortgages have hit their lowest point in this cycle, according to economists at ASB.

Site by PHP Developer