The current government started with impossible thoughts of the government building 100,000 new houses. When it was clear this would not happen, it, together with the Greens, decided that more rules and regulations would fix the lack of good quality affordable rental houses available.
The government may have thought that beefing up the minimum standards for all rented housing would help the growing number of people renting long-term. Less reasonably, it somehow hoped that more rules would not increase the cost of renting.
It was advised by landlords that some of the rules would be unworkable and they would in general increase the costs of rental housing. Undeterred, the government, with the enthusiastic support of the Green Party, boxed on ahead.
The rules came out.
The desire for the prevention of possibly damp and mouldy homes led to rules about having a means of heating which allows rooms to be maintained at 18°C. This must be achieved in ways which mean that adding on another heat pump may not work; you need to replace the one you have.
An extractor system must be present in kitchens and bathrooms must have an extraction system which will need to have a minimum diameter (including ducting) of 150mm or an exhaust capacity of at least 50 litres per second. Insulation must be present at certain levels if it can be installed.
Together with these rules came a rule that you cannot end a tenancy as a landlord once it starts, even if the tenancy has an end date. There is also the ability for a tenant to complain about a breach of the rules and receive money from the landlord.
These standards, go beyond those that the majority of New Zealand provide in their own homes. Together with landlords not being able to end a tenancy and making landlords pay tenants for breaches, the rules had the effect that was anticipated by landlords.
In Queenstown or any other tourist and seasonal areas, houses could have been available for the ski season or the summer season, which allows temporary workers to do seasonal work for six months at a time.
Now if the house you might have rented out over the tourist season is wanted at other times of year, this is not an available option. If it doesn’t have a range hood or other compliant extraction system it will be non compliant.
If it breaches any of the rules, you may have to pay a tenant for the breach and also not be able to have your house back for so long as the tenant wants to stay.
To add the final nail in the coffin of tourist town renting, tribunal rulings are now being made saying no smoking and no pets clauses in tenancy agreements are unenforceable.
Somehow the tenancy tribunal has been allowed to override the provisions in tenancy agreements if the behaviour of tenants is actually not illegal, even if it is in breach of the tenancy.
Other rulings disagree. No-one has any idea what the law here actually is.
There is also a new rule not allowing the cost of the mortgage a landlord may have being deductible against rent. Any other person wanting to run a business can deduct the cost of borrowing: think farmers buying tractors, dentists buying their equipment.
This was bound to have the effect of increasing the costs to renters and decreasing stock available.
So while the government wanted better housing for renters, more people sleep in cars and businesses can’t get workers because there is nowhere to live.
We could have thought the government was well motivated in wanting better standards for those who are renting. But it is less benign in the event.
The government and community housing providers own social housing. These homes are intended to be provided for our most vulnerable people including those who cannot afford or access private rental housing.
There are 200,000 New Zealanders at present who live in Kāinga Ora houses, half of them children.
However the government chose to exempt itself from the rules for years after private landlords has to comply. From July 1, 2021, all new private rentals had to comply with the new standards. All boarding houses had to comply, with the exception of Kāinga Ora and community housing providers, who do not need to meet the standards until July 2024.
In other words the most vulnerable New Zealanders do not have the benefit of their homes being "healthy" yet and will not be able to expect this from government social housing.
The government has also made an exception to the tenancies continuing for so long as the tenant wants to stay rules for universities which have student housing, but not private rentals in student areas.
The government also appears happy to provide rent for people to live in unacceptable housing.
The government has achieved more pressure on housing availability while not leading by example with its own housing. Seasonal tourist areas have more pressure on their housing. University flatting arrangements are now a shambles.
Press releases about good affordable housing are not the same as a practical plan.
Making it harder for landlords without improvements for tenants is unlikely to improve the supply of good affordable rental homes.
- Hilary Calvert is a former Dunedin city councillor, ORC councillor and former Act New Zealand MP.
