Landlord Information

Landlord Obligations and Responsibilities

There can be a lot to remember being a landlord, with a number of responsibilities falling to you. Getting a good property management team involved can simplify things for you, including finding tenants, handling maintenance and deal with any issues that may arise.

From 11 February 2021, multiple changes to tenancy legislation took effect. The changes covered: 

• Security of rental tenure – Landlords will not be able to end a periodic tenancy without cause by providing 90 days’ notice. New termination grounds are available to landlords under a periodic tenancy and the required notice periods will change.
• Changes for fixed-term tenancies – Fixed-term tenancies signed on or after 11 February 2021 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.
• Making 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.
• Prohibitions on rental bidding – 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. This does not apply to a fixed-term tenancy granted before 11 February 2021.
• Landlord records – Not providing a tenancy agreement in writing is an unlawful act and landlords will need to retain and provide new types of information.
• Enforcement measures being strengthened – The Regulator (the Ministry of Business, Innovation and Employment) has new measures to take action against parties who are not meeting their obligations.
• Changes to Tenancy Tribunal jurisdiction – The Tenancy Tribunal can hear cases and make awards up to $100,000. This is a change from $50,000.

For the most up to date information, visit tenancy.co.nz.

A landlord must:

• If asked, give the tenant a statement saying what period the rent paid relates to.
• Give the tenant 60 days written notice of a rent increase (due to legislation changes, these are limited to once every 12 months).
• Give the tenant 48 hours notice of an inspection.
• Give the tenant 24 hours notice of entry to make repairs.
• Inform the tenant of any intention to sell the property.
• Make sure the locks and fastenings are working and are adequate.
• Make any necessary repairs within a reasonable time period.
• Reimburse the tenant for any urgent repair work that the tenant had to have done (as long as the tenant attempted to notify the landlord before having the work done).
• Make sure the property is clean and in a fit and habitable condition at the beginning of and during the tenancy.
• Adhere to the Healthy Homes Standards - see tenancy.co.nz/healthy-homes for more information.
• Pay all outgoings; rates, insurance, land tax etc.
• Take reasonable steps to ensure that tenants aren't disturbed by the landlords other tenants.

A landlord must not:

• Ask for more than two weeks rent in advance at the beginning of the tenancy.
• At any stage during the tenancy, ask for more rent in advance to be paid.
• Inspect the property more than once in four weeks, except as allowed for to check on work done by the tenant.
• Harass the tenant.
• Interfere with, or allow others to interfere with a tenant's reasonable peace, privacy and comfort.
• Interfere with the gas, water, electricity supply or telephone.
• Unreasonably withhold permission (particularly if in breach of the Human Rights Act) for a tenant to sublet or assign the tenancy to someone else if not prohibited by the Tenancy Agreement.
• Change the locks without the tenant's consent.
• Enter the property except as permitted by law or with the tenant's consent.
• Damage or allow others to damage the property, whether deliberately or carelessly.

Bonds

A tenancy bond is a payment of up to four weeks rent made to the landlord by tenants when they move into a property. The bond is held to cover any losses the landlord incurs if the tenant breaches any of the conditions in the Tenancy Agreement or general obligations of a tenant.

The landlord will collect the bond from the tenant, but must lodge it with MBIE within 23 working days, with a signed Bond Lodgement form (by both the landlord and tenant).

The bond is held by Tenancy Services until a Bond Refund form is filed (signed by both the landlord and tenant) by either the tenant or landlord. To ensure this part of the process progresses smoothly, it is important for the tenant and landlord to lodge any Change of Tenants or Change of Landlords during the period of the agreement.

If there is any damage to the property at the conclusion of the agreement, and the landlord and tenant agree as to the value of this then the bond is divided between the parties accordingly. However, if the parties are unable to agree on the value, then one of the parties can apply to the Tenancy Tribunal for mediation.

Insurance

We consider it imperative that landlords and tenants understand whose responsibility it is to have insurance to make sure that both parties are protected against loss. Below is a general guideline for landlords and tenants.

The most important factor to remember when selecting insurance is to inform your insurance company that the property is a rental property.

Tenants

The tenant should ensure they have personal contents insurance for their belongings to ensure they are protected against loss.

Landlord

The landlord must have insurance for the property, that is the physical buildings, section etc, against fire, storm, flood, Methamphetamine, damage from burglary etc if they want it protected against loss. For these types of policies, it is imperative that you advise the insurance company that the property is tenanted to ensure coverage. These policies often cover chattels, e.g. carpets and curtains, which is preferable however, this should be clearly defined and clarified with your chosen insurer.

It is also often recommended that landlords take some form of Property and Income Protection insurance. This is additional insurance taken out by a landlord to cover for:

• Loss of rents due to abandonment
• Loss of rents due to eviction
• Malicious damage/theft by tenants
• Rent recovering whilst malicious damage is being repaired

Repairs and Maintenance

Both the tenant and landlord have responsibilities and obligations when it comes to repairs and maintenance which both parties should be aware of. After all, it is in both parties interests to have the property repaired promptly to prevent further damage and discomfort of living.

• Act as soon as you know something needs to be repaired or maintained.
• Talk to each other – discuss what should be done and when.
• If necessary, take steps to limit damage or loss before maintenance or repairs are done.
• Allow a reasonable amount of time for routine maintenance work to be completed.
• Complete work as soon as reasonably possible if the problem is urgent and likely to cause injury to people or damage to property.
• Get quotes and ensure costs are reasonable, especially if the other party will end up paying.
• Keep inconvenience for others to a minimum.
• Clean up when the repairs or maintenance are finished.
• Discuss a possible rent reduction until the repairs are completed.

The tenant is not responsible for repairs or damage arising from burglaries, natural events (such as storms, floods and earthquakes) or fair wear and tear. 

Tenants need to tell the landlord if they know of any damage or need for repairs. If the tenant does not notify the landlord as soon as possible the landlord may be able to claim some of the costs of repairing the damage from the tenant if it gets worse.

Intentional Damage

If a tenant (or their invited guests) intentionally damages the landlord’s property, the tenant must tell the landlord. The landlord can ask the tenant to repair the damage, or to pay the cost of replacement or repair.

Careless Damage

On 27 August 2019, new legislation took effect which affects tenants liability for damage. If tenants or their guests carelessly damage a rental property, they are liable for the cost of the damage up to four weeks’ rent or the landlord’s insurance excess (if applicable), whichever is lower.

Landlords can’t ask for or accept more than that limit.

Insurance companies can’t chase tenants on the landlord’s behalf for the cost of repairs for careless damage.

If the landlord and tenant can’t agree who should pay, either can apply to the Tenancy Tribunal.

If these obligations are fulfilled it is advantageous to both parties, with the tenant having a safe, comfortable place to live and the landlord having an investment that will continue to give good returns.

Mediation

Mediation is usually the second step of dispute resolution - the first being talking to your tenant/s. If the first step is unsuccessful then either the landlord or tenant can apply to the tenancy tribunal for mediation.

Mediation is where an impartial person helps the two parties come to a solution for their problem.

The mediator will allow each person to explain to the other how they see the problem, help them discuss the possible ways to solve the problem and encourage them to choose the best solution for both of them.

A mediator is not able to make a decision for the parties, they can only help and encourage the parties to come to their own agreement.

The decision is put into a Mediated order which is binding on both parties.

Occasionally, the parties in mediation can not agree upon a decision. If this is the case, then the dispute will go to a Tenancy Tribunal hearing.

Tenancy Tribunal

The tenancy tribunal is a special court set up to deal with unresolved problems between landlords and tenants which they have been unable to settle themselves.

A Tenancy Tribunal case normally only comes after mediation between the parties has been attempted and the parties have been unsuccessful at coming to a conclusion.

A tenancy adjudicator oversees the case and makes the decision, which is legally binding on both parties.

The adjudicator listens to both parties, any witnesses and evidence that either party feels is important and makes a decision based on this information and any provisions in the Residential Tenancies Act.

For more information visit the Tenancy Services website at www.tenancy.govt.nz.

Covid 19 Information

Click here for the latest information on Covid 19 www.tenancy.govt.nz.