HELPING THE HOMELESS IN ROTORUA INTO PERMANENT HOMES

Tiny Deane, who is well-known in the city, and his and his wife Lynley started helping homeless people in 2017, launching the Visions of a Helping Hand Charitable Trust with the aim of getting people into permanent homes. When Covid-19 hit however, the shelters had to close because it was hard to apply physical distancing and other hygiene rules. In March, using government funding, he rented two motels on Fenton Street in Rotorua and one in Taupō to continue helping those without a home. He said the 120 people staying at the motels were from different walks of life, and with women and children as well as rough sleepers it was hard work. Deane said the ultimate goal was give people permanent homes and they had moved more than 40 families from the Rotorua motels to rental properties.

https://www.rnz.co.nz/news/national/424958/rotorua-man-rents-motels-to-house-homeless-during-pandemic - 1 Sept

3 MONTHS UNTIL HEALTHY HOMES COMPLIANCE STATEMENT DEADLINE

The Real Estate Institute of New Zealand (REINZ) is today reminding property managers and landlords that the Healthy Homes Compliance Statement deadline is just three months away for any new or renewed tenancies, coming into effect on 1 December 2020. This is a five-month extension period from the initial deadline set by the Associate Minister of Housing, due to delays caused by COVID-19. Bindi Norwell, Chief Executive at REINZ says: "The advice we are giving to landlords and property managers, as we did earlier in the year, is to not leave Healthy Homes Standards inspections until the last minute." Under the new requirements, from 1 December 2020 all landlords must include a statement of their current level of compliance with the Healthy Homes Standards in any new or renewed tenancies. Inspections by qualified tradespeople (or people with sufficient, relevant experience) are typically necessary given the type of information required for Compliance Statements https://www.scoop.co.nz/stories/BU2009/S00025/three-months-until-healthy-homes-compliance-statement-deadline.htm – 1 Sept

HOME OWNERS SPEND A THIRD OF THEIR SALARY ON MORTGAGE AND RENTERS 20%

Homeowners are spending just over a third of their salaries to pay off their home loans. Housing affordability has slightly improved, CoreLogic said. The cost has dropped slightly due to lower home loan interest rates.The figure is lower than the 34% paid by Australian households to service their mortgages. According to the research firm, New Zealand households were spending 49% of their income on their mortgages in 2007, before the global financial crisis. The long term average is about 34%. CoreLogic found that it takes an average of more than 8.5 years to save the deposit for a house. For renters, the market isn't noticeably less affordable than in the past, the report said. Average rents currently absorb 20% of household income, in line with the historical average. https://www.goodreturns.co.nz/article/976517439/households-spending-32-of-income-on-mortgage.html - 2 September

https://www.landlords.co.nz/article/976517439/households-spending-32-of-income-on-mortgage - 2 September

NEW ROTORUA HOME PERFORMANCE ADVISORY SERVICE ANNUAL REPORT

Undertaken by Sustainability Options, the Rotorua Home Performance Advisory Service Annual Report stated it assessed 154 homes in the year to July 2020. The organisation also provided cumulative data on the 490 homes it had assessed since 2017. The majority of homes - 67 per cent - were in reasonable condition," the report said. "Ten per cent were in excellent condition." Two per cent were not acceptable, requiring "significant work" and 15 per cent "barely acceptable", requiring a range of recommendations to be implemented. RentAssured co-owner and Rotorua Property Investors Association president Debbie Van Den Broek said the properties she saw nowadays were warm, dry and up to standard. "Low-price shoddy rentals have disappeared. That's why rents have gone up in Rotorua." She said the condition of rental homes in Rotorua was "definitely on the up" because legislation had forced "bad landlords to up their game". She said homes found to be in bad condition had "slipped through" and could be owner-occupied. https://www.nzherald.co.nz/local-democracy/news/article.cfm?c_id=1504814&objectid=12361660 – 3 September

COMPENSATION TO TENANT FOR FAILURE TO SUPPLY WATER

A Northland tenant has been awarded compensation after having to source water for her home from a stream. The Residential Tenancies Act requires that when a property is not on a reticulated water supply, the landlord provides adequate means for the collection and storage of water. The tribunal adjudicator Nicholas Blake said the water problems were difficult to determine as the pump failed at the end of the year and there was also a severe drought in Northland. Blake said it was concerning that there was no filtration on the water supply to the house, as water was being sourced from the stream. Rowlinson was awarded $200 for the inconvenience caused by the water problems. https://www.stuff.co.nz/business/122636042/northland-tenant-compensated-after-living-without-filtered-tap-water - 3 Sept

MAKE THE MOST OF THE LOW-VALUE ASSET WRITE-OFF THRESHOLD INCREASE TO $5,000

Residential landlords, take note: the clock is ticking on the Covid-19 related increase to the low value asset write-off threshold, writes property accountant Anthony Appleton-Tattersall.* The low-value asset write-off threshold was increased from $500 to a very generous $5,000. But only until 16 March 2021, so the opportunity to utilise it is halfway gone already. And with the threshold raised to $5,000 a lot of opportunity opens - particularly with the healthy homes deadlines looming. New minimum standards for heating, and kitchen/bathroom ventilation mean big costs which would been depreciated over many years but can now be claimed in full – as long as they're under $5,000 including installation costs, and not purchased in a group with other assets where the total spend is over $5,000. https://www.goodreturns.co.nz/article/976517438/comment-don-t-miss-your-5-000-deductions.html - 3 Sept

AUCKLAND PROPERTIES SELL CLOSEST TO CVS

REINZ has analysed the sales price to valuation ratio of residential properties by region over recent months and the results make for interesting reading. In Gisborne properties are selling on average for 71% more than their current CVs, which is the highest in the country. It is followed by Southland, where prices are around 43% higher than their current CV and Hawke's Bay and Marlborough where properties are selling for around 27% more than their current CVs. However, the situation in Auckland stands in contrast to that in Gisborne. Despite recent headlines of an uplift in sales of Auckland's multi-million-dollar mansions, at a regional level Auckland's residential properties are currently selling at the closest to their CV. https://www.goodreturns.co.nz/article/976517445/where-are-properties-selling-most-above-cvs.html - 4 Sept

BEING TOO SLOW TO FIX A PROBLEM MEANT PAYOUT TO TENANTS

Wellington tenants who spent months unable to use their toilet without afterwards battling leaks and pipe blockages have won a $1420 payout. Weighing the evidence, adjudicator Lash awarded the tenants $650 compensation - a $50 rent reduction for each of the 13 weeks their toilet was out of action - and $750 exemplary damages for failure to provide a home free from damp and odour. She said Iron Bridge Property Management had acted promptly last July in replacing the rental's toilet, however, they took too long to follow up and fully rectify the problem between August and November. https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12362248 – 4 Sept

IDEAS FROM RENTERS UNITED

A renters group is calling for it to be illegal for landlords to raise the rent beyond inflation, even if they've had to make changes to meet new minimum standards. It comes as landlords get ready to raise rents once the ban on hikes lifts later this month. Renters United has penned an open letter outlining its solution to the crisis. In the short-term, the group wants rent increases limited to no more than inflation - so a median weekly rent of $470 instead of going up $25 - as it would based on recent trends - could only be increased about $5. Renters United also wants rents for new tenancies to have to be set "within a reasonable range of the median rent of comparable houses in the area". In the long-term, Renters United wants tens of thousands of new "state, council and community" homes built, and tens of thousands of new homes for purchase, with limits on the ability to on-sell "so that these schemes are not windfalls for the first purchaser". Renters United also wants "economic incentives and sanctions that together will force the replacement of the worst of the private rental stock". https://www.newshub.co.nz/home/politics/2020/09/tenants-brace-for-economic-pain-as-ban-on-rent-hikes-comes-to-an-end.html - 4 September

PROBLEMS WITH EMERGENCY HOUSING UNVEILED

Last week Newsroom revealed the existence of a now-shuttered MSD initiative to secure emergency housing by paying motel room rates for three and four-bedroom houses. Some landlords earned up to $3000 per week at these rates causing them to take properties off the rental market so their properties could be funnelled into the much more lucrative emergency housing one. Emergency Housing Special Needs Grants (EHSNGs) were issued for seven nights at a time. Initially centred on motel and hotel accommodation, the grants were expanded out to include private rental homes in 2018. MSD put a stop to it in the middle of this year creating "chaos" in South Auckland as families scrambled to find new accommodation. Social Development Minister Carmel Sepuloni said MSD had seen demand for accommodation rise 223 percent since 2018 (when rental houses were used for emergency accommodation). She also refused to class the $2000-$3000 a week payments as "rent payments". They were "costs met by MSD to accommodate clients in properties". . https://www.newsroom.co.nz/pro/garage-rooms-went-for-motel-rates - 4 Sept

HIGH DENSITY HOUSING IN HAMILTON

Residents will have to accept Hamilton's rapidly changing streetscape, including more apartments and townhouses, if the city is serious about creating affordable housing, developers say. Hamilton's housing is the third most unaffordable in the country – behind Auckland and Tauranga – according to a housing stocktake report released in 2019. In July, the Government released new guidelines aimed at dramatically increasing housing developments in the country's fastest growing cities, including Hamilton. The National Policy Statement on Urban Development will slash height restrictions in some suburbs and force councils to accept developments with no car parks. https://www.stuff.co.nz/life-style/homed/residential/122632516/residents-developers-and-city-leaders-grappling-with-high-density-housing-in-hamilton-one-of-nzs-least-affordable-cities - 6 Sept

HOUSING CRISIS IN MARLBOROUGH

Salter said she knew Marlborough had a "housing crisis" before moving home from Australia in July last year, but she "didn't think it was as bad as what people said". She is one of 200 people on Marlborough's social housing register. In 2015, there were 13 people on the wait list. Spokeswoman Vanessa Taylor said the country's "cramped rental market" was likely to continue, given the country's long-term housing shortage, a growing population surpassing 5 million this year, and more Kiwis returning home due to the coronavirus pandemic. Marlborough's median rent was $350 a week in 2016, but reached $420 in February this year. https://www.stuff.co.nz/life-style/homed/real-estate/122594619/good-credit-good-references-and-still-one-of-200-waiting-for-social-housing - 7 Sept

A WAY OF KEEPING RENTS AT AFFORDABLE LEVELS

One simple but important lesson of economics is that the side of the market that has a harder time responding to changes in prices bears the brunt of price changes, for better or worse. The "inelastic" side of the market draws the rent. Landlords still compete against each other for tenants, but when there are few houses available and owners are forbidden from tearing down existing ancient, draughty, mouldy wooden tents to put up dry and warm townhouses and apartments, tenants are in a pretty terrible spot. When it is easy to build new houses, townhouses, or apartments, it is hard for rents to go up by that much. If rents go up, someone can profit by building new housing and renting it out. It is only when restrictions on building prevent that from happening that rents can really get out of line. https://www.stuff.co.nz/business/opinion-analysis/300100607/heres-what-would-really-control-new-zealand-rents - 7 Sept

NZ HERALD JOURNALIST MISINTERPRETS COMMENTS MADE BY ANDREW KING

Landlords should wait to see if National wins October's election before spending money refitting their rentals up to new heating standards, a lobby group for property owners says. The standards require - from July 1, 2021 - that all rentals be fitted with insulation, heating and ventilation within 90 days of an existing tenant renewing their lease or a new tenant moving in. Some rental owners had been preparing for next year's deadline by making the upgrades now. But Andrew King, from the NZ Property Investors Federation, said National's election promise could give landlords reason to pause and sniff the wind. Rather than be forced to install modern heat pumps, a National election win would allow landlords to instead give tenants a choice, he claimed. Enjoy the benefits of a modern heat pump - which can cost up to $3000 - and be willing to pay for it in the form of higher rent, or forego it and pay cheaper rent. "It probably is a good idea to hold off," he said. King said he would personally install a heat pump straight away if his tenant wanted it and was willing to pay a higher rent because the tenant was the customer and needed pleasing. But landlords didn't like to be told they had to do it because in some cases the tenant might not want new heat pumps, he said. Labour's Associate Housing Minister Kris Faafoi took aim at King's comments.https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12361468 – 7 Sept

HERE IS THE TEXT OF A LETTER SENT BY ANDREW KING TO KRIS FAAFOI THIS MORNING

I have just read the above NZ Herald article saying the NZPIF is advising landlords not to meet requirements of new Healthy Homes legislation till after the election. This is not correct and I'm really upset. As you know, the NZPIF were supportive of National's Minimum Standards legislation and really only have a problem with two aspects of the Healthy Homes legislation. Heat pumps in every rental and topping up insulation to current standards.

The NZPIF has been encouraging landlords to insulate and install heat pumps for many years. We have established discount schemes to make it easier and cheaper for members to do this. However members have frequently said that tenants don't want heat pumps and even when landlords have installed them, tenants haven't used them. Based on this information we came up with the Winter Heating Grant idea that Labour has introduced, albeit in a modified way. This grant encourages tenants to actually use their heaters. Good for them, good for the property and good for taxpayers as it helps keep people, kids especially, out of hospital.

We have been encouraging members to use the higher $5,000 depreciation cut off level, available till next March, to install heat pumps. So we are not advising members to wait.

The NZPIF has always seen the landlord/tenant relationship as a service provider/customer one. Always provide a warm, dry and well maintained home with features that tenants likely to rent the property would want. I said landlords could ask their current tenants if they want a heat pump. If the tenant didn't want a heat pump then perhaps consider waiting until they legally had to install one. This comment was meant to be in a tenant focused manner looking at the desire of the tenant. It was not meant as "do the least you possibly can get away with" as the NZ Herald article portrays it.

Jan Hains

NZPIF Communication Officer

04 972 5178

0274 526 964