Opinion

Guest blog: Time to sort water issues once and for all

There have been countless reports this year of Auckland’s rental property shortage.

Tuesday, August 14th 2012

Obviously this doesn’t have just one simple cause.

Rising costs, low returns for the capital invested and an environment that is perceived as hostile to private landlords combine to make landlording a less attractive business to be in.

One of the ongoing hassles with residential rental administration is dealing with water.

While electricity and telephone services are the tenant’s concern, the water supply has become a bit of a mongrel, the joint concern of both.

Back in the days when things were simple, the council rates bill for a property would include a fixed sum for the year for the supply of the water and other water-related charges

Over time, this system was held to be environmentally unfriendly, as it held no penalty for those householders who used or wasted exorbitant amounts of water.  Councils began to install water meters so that water use could be monitored. Water monitored could be water charged, and landlords began receiving invoices for the water charges incurred by their tenants.

To compound this developing problem, there was no standard charging system adopted by all councils.

All these changes left the Residential Tenancies Act, the bible of the residential landlord, somewhat outdated.

The Tenancy Tribunal’s current ruling is that water supplied can be charged to the tenant, but only if a meter is installed that measures water supplied solely to that tenant. Wastewater charges are also the tenant’s responsibility. But where the wastewater is based on a fixed daily sum and where there is a daily service charge then these costs are held to be the landlord’s responsibility.

Compound that with Watercare insisting that the water supply costs are, in the final analysis, the responsibility of the landlord and we have a real mess.

The landlord receives the account, normally pays the full amount of both variable and fixed costs to Watercare, and sends a copy of the account to the tenant itemizing the variable charges that the tenant owes.

When the due date arrives, often the Tenant has not paid their share. This leaves the landlord only the option of issuing a 14-day notice under the RTA, and eventually having to lodge a claim to try to get a refund of the money due and already paid out.

All this takes time. I have just spent three hours sorting out water accounts and sending letters to the tenants

With the onset of monthly billing by Watercare this is only going to get worse.

The usual answer given by those not personally facing this problem is to say ‘‘work out the water costs and just include it in the rent’’. This is a facile answer on several grounds.

Firstly the original intention for the installation of water meters was to create an incentive by those who actually use the water to conserve water.

If the tenant as end user is not paying for any water they waste, then this incentive fails. Secondly, any sudden increase in water usage can indicate problems with the water reticulation system in the property. Leaky taps, worn hot-water cylinder valves, overflowing toilet cisterns. If the tenant has no financial penalty when they see these problems develop, they have no incentive to notify the landlord and arrange repair.

The RTA needs to be amended to make it clear that all water-related are solely the responsibility of the tenant. Secondly, Government action is needed to compel water supply authorities to accept residential tenants as their customers.

Action in this matter will reduce the administrative load on landlords, provide a real incentive for tenants to conserve water, and go some way to restraining further increases in rental levels. - Peter Lewis is an Auckland landlord.

Comments

On Tuesday, August 14th 2012 1:20 pm James said:

The politics behind the whole water debarcle and the over inflated costs is disgusting. With Auckland Council owning 100% shares in Watercare - yet Watercare being a separate entity, removes any direct liability from the council for every poor decision that gets made. With absurd infrastructure growth charges, continual increases in water charges and now inevitable fee increases due to administrative overhead caused by moving to monthly billing system, they 1. wonder why we have a housing shortage and 2. wonder why rents are so high. I'm off to pull out the water meter from my rental properties, pay the fixed unmetered cost of $582 per year and tell the tenants they can fill up the sink, have baths every night and leave the garden spinkler on 24x7...

On Tuesday, August 14th 2012 2:24 pm Joanne said:

Water Care and other water companies need to come into modern times, stop being so stubborn and let tenants set up accounts just like they do with power, gas and phone. Do we hear those utility companies complaining about billing tenants directly? no! works just fine and dandy!

On Tuesday, August 14th 2012 2:54 pm Sean said:

This is a major issue for landlords and as is stated accounts for water should be set up directly with the tenant. Watercare have got the best of both worlds on this and must enjoy a very low bad debtors list. Now having to administer these oncharges to tenants on a monthly basis and chase up late payment is a major admin headache. I've set mine up now on electronic billing so I can easily flick the bill onto the tenant electronically saves scanning or photocopying and posting. All of mine are metered so they get the full charge. Time watercare set up with the user.

On Tuesday, August 14th 2012 6:17 pm Matthew said:

Agree 100%. The current situation is ridiculous and more needs to be done to force water providers to deal with the users of their services, rather than the owner of the property at which the said services are supplied.

On Tuesday, August 14th 2012 7:20 pm Klauster said:

I grew up in a rental where my parents paid rent for the property and monthly charges for services supplied by the local council, for the consumption of energy, water and services like TV, phone line etc. In NZ are all housing related expenses charged to the property owner. No wonders that the costs and consequently the rents are going through the roof. Does it really make sense to separate the consumer from the related costs or invoice? It is too easy to condemn the landlord to be the debt collector for unpaid water bills etc. And to split tap water and waste water make little sense either - who drinks water, p... water or not? In my understanding waste water is a result of water usage – why treating it differently?

On Wednesday, August 15th 2012 10:44 am Janet currie-robson said:

As a property manager this is an on going head ache with owners screaming and tenants not paying,as the TT laws state that the OWNER is responsible for a potable water supply for tenants, and yes try going to tribunal, takes 8 weeks if lucky to get a hearing, then have the order, then have the tenants still not pay or better still disappear [try getting a forwarding address and being told THAT UNDER THE PRIVACY ACT!!!!!!!!]WE ARE ALWAYS BEHIND THE 8 BALL THEN COP IT FROM THE OWNERS??? it is about time that the Govt departments be given the right to disclose as most of my tenants are beneficiaries. As Klauster said if the tenant doesn't pay direct to the water company then they suffer when its cut off. Janet

On Wednesday, August 15th 2012 5:11 pm Jeff berge said:

It is a shambles and typical of a council run utility. I have always paid only the portion that I am currently liable for and send the invoice on to the tenant. If they choose not to pay their portion then late penalties are added to their portion of the account. When they leave I get a water reading done and any outstanding monies comes out of the bond. I have had Watercare debt collection ring me and I tell them not my problem, I have paid my portion contact the tenant. I am certainly not their debt collector.

On Thursday, August 16th 2012 2:48 pm James said:

OMG... I have just done a relocatable property in Rodney area. I was quoted $7,000 in infrastructure growth charges. I have now finished the property and asked Watercare to get the water on, and now been quoted $14,800. There is no way in hell I am paying this fee. Keep an eye out on fair go... this is absolute daylight robbery.

On Saturday, August 18th 2012 1:35 am John hall said:

My thought on water is in time gone by when land was first rated the proceeds was for the infrastructure of the city. Water is a need,rates keep going up and so do the water charges and the thought is that we get boned twice by the butchers knife

On Saturday, August 25th 2012 3:19 pm Helen Wenley said:

If the tenant pays for their power and telephone usage, then water must be treated the same way. As a landlord, I am not responsible for tenants use of water. This whole thing is crazy! So what can we do? Surely if enough people got together and formed a pressure group....

On Monday, September 03rd 2012 4:25 pm John said:

The water bill consider this as a land lord, a leak can be costly, a burst pipe more so a monthly account. I consider it a blessing as it could save you money if its not an estimated one and check your water meters frequently yourselves if possible at home and on the rentals.

On Wednesday, March 06th 2013 1:08 pm Glenn said:

The waste water levy was initially part of the land rates. I think that it is fair that tenants pay for water usage, and that landlords pay the waste water levy. I am a landlord of many years standing and both parties believe that it's unfair. In many cases tenants are considered low socio economic, why penalise them with more charges. Why should a tenant pay waste water levies? This is just an unnecessary charge, that burdens the tenant even more, yet landlords also believe is unfair.

On Monday, April 29th 2013 4:33 pm Gary said:

I wonder how Housing New Zealand and Auckland Council get the money from their tenants to pay the water charges OR do they (HNZ and AC) just pay the accounts and their tenants get free water. I've sent a letter to Minister of Housing which must have got lost in the mail. Maybe one to Len Brown asking him how it's done. It's hard enough with three without having thousands.

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