Rented for 2020 — but then what?

From late spring, they sprout on many windows and doors in North Dunedin.

Some are colourful and beautifully finished but most are plain and hastily made. But no matter their form, they serve the same function: they tell flat hunters to keep on hunting.

‘‘Rented for 2020’’ signs are ubiquitous in the student quarter at this time of year and while they are bad news for the temporarily homeless, they are great news for city landlords.

The market is buoyed by students seeking certainty months in advance of the new academic year. Months away from next year, demand in popular areas outstrips supply. It is a seasonal rush that starts as the city emerges from winter, but there are ominous signs a season that provides certainty for renters and landlords alike is about to change.

Plans to retool the Residential Tenancies Act are considered a looming threat to many city investors who have rental properties in suburbs where fixed-term, annual contracts are the norm. The changes would allow fixed-term tenancies to automatically become periodic tenancies at the end of a fixed-term agreement. This will happen unless both parties agree otherwise, the tenant is not meeting their obligations, or specified grounds for the tenancy to end apply.

Currently, agreements without a fixed end date can be terminated without cause as long as the landlord gives 90 days’ notice. These ‘‘no cause evictions’’ will end, with the Act providing for a range of justified reasons to end a periodic tenancy.

The Government has been clear as to why the law must change. Runaway house prices have outpaced wages to such an extent there has been a steady shift from home ownership, meaning a significant proportion of a new generation will rent rather than own.

Such renters are exposed to risk. They risk losing their home when rents increase or when they are rented to someone else. They risk an unsettled future, itinerant when they should be forging community bonds and securing consistent schooling for their children.

This is part of the pro-change narrative and there is little doubt it rings true for people exposed to the whims of the demand-led rental market. Queenstown, Central Otago, South Canterbury or Dunedin — no matter where in the South one is, equitable and affordable access is not available to everyone.

Landlords will — and should — say this is how markets work. They take the financial risk to provide a service whose value is set by what the market is prepared to pay. At the same time, they want the certainty of well-planned tenancies and control over how their investment is used by others.

To some, the counterpoint is equally valid. For some landlords, risks are offset by untaxed capital gains while the market is skewed by a national housing shortage worsened by government mismanagement.

Many people have no choice but to accept high rent and shifting tenancies because of economic circumstances. It means some life-long renters will always be strongly disadvantaged.

The proposals would tackle this by limiting rent increases to once every 12 months and would ban rental bidding, in which renters make best-price offers for high-demand properties.

But tenancy rollover remains most problematic where circumstances dictate annual tenancies are the norm. The Dunedin market mirrors the academic year: vast numbers of rental arrangements risk uncomfortable periods of limbo as the rental year rolls into the next.

Renters will be in a much stronger position to say when they expect their occupancy of someone else’s property to end. Landlords will not want to lose good tenants, but they will also want the certainty of knowing their property will pay its way.

The Otago Property Investors Association warns many will sell rather than lose their ability to manage their risk. Others will step in, but they may be challenged by a new batch of signs declaring ‘‘Rented for 2021, until whenever’’.


My wife and I scrimped and saved our entire life and purchased an investment property near the University. WE own the property and WONT have the "Nanny State" telling US what we can do with the property. WHY? WE took the RISK in purchasing the property not the "Nanny State". Renting property in Dunedin is a disaster. "Tenants" move into the property and destroy it. All the things we've attempted to do to make it a home have been destroyed. We've decided it is more profitable to let the property sit empty and sell in the next few years than to rent it out and repair the damage done by tenants. We've lost thousands in repairs, lawyers fees, collections and the tenancy tribunal. We've vettedd our tenants through the appropriate systems and done background checks. Unfortunately, many young adults just prefer to live like feral animals. I feel sorry about the situation but my sympathy lies with other landlords not the tenants. The law has swung too far in favor of tenants, they need protections but so do the landlords. I hope other landlords who have had enought do as we have and just leave their properties vacant. If i wanted to deal with animals I would have become a vet!

That is your Dunedin experience. Elsewhere, these are the problems faced by tenants:

Random, frequent rent rises

No security of tenure. Landlord can evict with the 'need it for family' excuse.
Information on and assessment of tenants on Landlord database.
Limited understanding of work from home.

So I guess he should move his house somewhere else then? I thought we lived in a free market? The laws of supply and demand will dictate the price. I totally agree, feral renters are wrecking it for everybody! Zero sympathy, in fact my wife and I are going to keep ours vacant too.

FrankieC - Feral renters are unfortunately a reality but it was YOUR choice to buy a rental, it was YOUR choice to buy near the university, it was YOUR choice of tenants, it was YOUR risk, nothing to do with nanny state.

And while we're on the subject of nanny state, under National I can't choose to drive and text, I can't choose to buy sudafed, I can't smack my kids (yes, they voted for it too), they're against my choice to smoke cannabis and against drug testing. National are socially conservative and are more nanny state than labour. It's labour relaxing the abortion laws, cannibas laws, and who introduced marriage equality and even ACT introduced the End of Life Choice Bill.

National say they are a party of personal choice and responsibility, but they don't vote that way.

I'm off to buy a Mongrel Mob t-shirt while I still can.






Our journalists are your neighbours

We are the South's eyes and ears in crucial council meetings, at court hearings, on the sidelines of sporting events and on the frontline of breaking news.

As our region faces uncharted waters in the wake of a global pandemic, Otago Daily Times continues to bring you local stories that matter.

We employ local journalists and photographers to tell your stories, as other outlets cut local coverage in favour of stories told out of Auckland, Wellington and Christchurch.

You can help us continue to bring you local news you can trust by becoming a supporter.

Become a Supporter