Unrealistic expectations for landlords

As spring approaches, thoughts of warmer and sunny days enter the minds of people who have been cold in their homes over winter.

Insulation, or lack of it, in some draughty homes may have caused higher power bills. If people cannot afford to switch on a heater, then they will have rugged up as much as possible.

The Government last year passed a new law requiring rentals to be warm, dry and well ventilated.

The law will require landlords to guarantee any new tenancy from July 1, 2019 must be either properly insulated or contain a heating source able to make the home warm and dry. All tenancies must meet the new standards by July 1, 2024.

The exact requirements will be outlined by the Government well before the July 1, 2019 deadline. Grants of up to $2000 will be available for eligible landlords to upgrade their stock.

There has been much wringing of hands from representatives of landlords. The largest complaint was of bringing their properties up to standard in such a short timeframe. Rents will rise, they say. Those on the left bemoaned the greedy landlords who defended their actions by saying it is costing them money to bring their properties up to an acceptable standard.

Move on a few months to Saturday and the interview with Green Party co-leader Marama Davidson, who has an idea for an enforceable warrant of fitness for rental homes.

Ms Davidson told Newshub Nation it was good and well having minimum standards, which she added the Greens welcome and support. But what is needed for that to work is having in place an enforcement regime to ensure people can rent houses without having to have the burden of making complaints for damp, mouldy, cold homes or homes in a state of disrepair.

People even looking for a home should be assured in New Zealand the home to rent will be up to a certain standard.In Dunedin, some previous student flats have been put on to the market and are being bought by first-home owners as landlords exit the market without having to seriously upgrade some of their stock.

This may lead to a shortage in some lower-grade accommodation for which the Dunedin student scene has become famous. More than likely, the property rich University of Otago will continue to buy up land and buildings to build its own accommodation to house students. If it does not, and the rental accommodation market in the city tightens, students will need to look to other university cities.

In Auckland, property owners are leaving their rentals empty and banking on capital gain being more than what they can earn from upgrading their property and renting.

For all of her good intentions, Ms Davidson does not understand how the rental property market works. Although housing allowances are available for those on low and fixed incomes, if the allowances are increased, so are rents. The market will decide what people can and will pay.

Most landlords in New Zealand are ordinary Kiwis wanting to have some extra income or are looking at their rental property as a superannuation scheme. There is plenty of data available to show New Zealanders, in the past, have invested in property for retirement rather than managed funds or the sharemarket.

It is important to strike a balance between landlords and tenants rather than force landlords into a position where they cannot or will not comply with the extra burden Ms Davidson wants to enforce.

As much as the Greens may want this policy, it is unlikely to see the light of day as New Zealand First will see the perils of  forcing landlords out of the market, possibly hurting the retirement plans of many.

The Government’s priority, and that of the Greens, should be on providing enough state homes for people in need and leave the private sector alone.