Landlords on notice - MBIE

Monday 10 April 2017

Landlords beware: the Ministry of Business Innovation and Employment’s new investigations team has warned that it is cracking down on poor landlord and property management company behaviour.

By Miriam Bell

The MBIE’s Tenancy Compliance and Investigations team announced this morning that it is putting landlords and property management companies on notice to meet their tenancy obligations under the Residential Tenancies Act.

The announcement came after a recent audit of five property management companies which revealed varying levels of compliance when it came to smoke alarms and insulation.

Some of the companies had to take action to ensure they met their obligations under the RTA – although all are now fully compliant.

Team manager Steve Watson said that, under the RTA, smoke alarms are now required in all rental properties and all new tenancy agreements must include an insulation statement which details the location, type and condition of insulation in the property.

“Property management companies are acting on behalf of landlords and, as such, have a responsibility to ensure the properties they manage meet all legal requirements.

“This action should serve as a reminder that we take breaches of residential tenancy law seriously, and are working to crack down on poor landlord behaviour across New Zealand.”

The team, which was formed in July 2016, monitors and enforces compliance with the RTA and has the power to prosecute landlords who seriously or persistently breach basic housing standards.

However, the NZ Property Investor Federation believes that most landlords are not bad and take their obligations seriously.

For example, NZPIF data shows that 83% of their members’ properties are fully insulated to the RTA’s standards, two years ahead of the 2019 deadline.

NZPIF executive officer Andrew King said it is good to raise the professionalism of the industry and that is what they are trying to do too – although by helping and encouraging people.

About 90% of Tenancy Tribunal cases are landlords bringing cases against tenants for such issues as unpaid rent, he said.

“It would be good to see all the money that is going into the tenancy compliance and investigations team matched with something that addressed landlords’ loss of money from unpaid rents as these cases clog up the Tribunal.”

But the NZPIF has always supported the smoke alarm and insulation standards as it makes a good business case and, as such, they encourage their members to meet them, King added.

“The key message is that it is getting harder for people to manage property. If people want to learn how to do it properly, they should join their local property investors association.

“That’s the best and cheapest way to learn what landlords need to do and how to do it correctly. It saves time and money and decreases risk.”

Read more:

Tenancy Services takes on enforcer role 

Rental insulation requirements are now law 

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