It’s that time of year when a lot of people who rent find themselves looking for a new home. Maybe it’s because the university year is beginning, but it seems like a lot of tenancy agreements expire in February and March. So renting is in the news again.
RadioNZ reported how rising Wellington rents are squeezing people’s budgets. The Dominion Post reported on a database that landlords are using to vet tenants, which the Renters United group say is discriminatory. People are being forced to stay at backpackers while the Property Investors Federation, who represent landlords, says people
who can’t find a home to rent should just wait for the market to cool (where are they supposed to live in the meantime?!). And you may have heard the desperate story of an Auckland landlord who charges tenants an extra $115 a week just to use the kitchen.
One reason renting seems to get in the news at the same time every year is that it’s usual practice for landlords to demand one-year tenancy agreements. In many other countries, long-term renting is common. Landlords and tenants recognise the benefits of stable, secure tenancies. Tenants gets to put down roots in their neighbourhoods and they treat the property with all the care they’d treat a home they owned.
Our rental laws in New Zealand are seriously out of date. Economist Shamubeel Eaqub calls them “a relic of the past.” They’re written for a time when renting was just something most people did while they were very young, saving for a deposit on an affordable house. But in 2017, more people are renting for longer and that includes families. It’s time to fix the rules, because renting shouldn’t mean you have to accept lower standards.
We should be encouraging longer term tenancies in New Zealand. One way to do that would be to give tenants an automatic right of renewal when their lease expires. Some people might want to move or want the flexibility, but others want a stable and secure place to call home.
Another problem is rent rises. I’m suspicious that some landlords insist on one-year leases so they can easily put the rent up every year when the lease is renewed. I’d like to see much more transparency around rent rises. Landlords should be required to state when they will review rent and how they’ll calculate any rent increases, before anyone signs a lease. That would mean tenants know what’s coming, just like people with fixed rate mortgages know when their mortgage rate will be up for review.
Let’s look at some facts: average hourly wages rose 1.3 percent last year according to Statistics NZ. Rents rose more t
han 7 percent nationwide to a record high, according to Trade Me. And that’s just the average – in Marlborough, rents rose a whopping 23 percent. There is no way that people’s incomes are keeping up with the cost of renting a home.
Finally, the National government missed an opportunity last year when it made small tweaks to the rules around the quality of rental
properties. What we need is a proper Warrant of Fitness for rental homes to ensure that every rental is warm, safe, and dry. What National did instead is require smoke alarms and 1970s-standard insulation. It was a cop-out and a perfect example of a government that does what’s easy, not what’s right.
40,000 children get admitted to hospital each year in our country because their homes are cold and damp and making them sick (and quite a few adults too!). It’s a disgrace and it’s not that hard to fix it with a decent government-supported home insulation programme. Unfortunately, National cut the funding for that too.
It’s summer (at least in parts of the country), so hopefully if you rent your home it’s not too cold right now, but when winter rolls around remember who decided that your home didn’t need to be warm and dry: National.
Most tenants and most landlords want the system to work well. There’s no reason to let a few bad apples stop us from modernising rental rules in a sensible way.
Last year, I put forward a Bill to fix some of the big problems with renting rules. National, United Future, and Act voted against it in Parliament, so it failed by one vote.
If we want fairer rules for people who rent, we’re going to have to change the government.