Rental housing law under review

Building Issues Minister Margaret Wilson today announced the first review of the Residential Tenancies Act 1986.

"The residential tenancy market has changed significantly in the last 18 years," Margaret Wilson said. "A greater proportion of New Zealanders are renting their homes than ever before and more people opt to stay in rental housing long-term.

"For example, more older people and families with children now live in rented homes.

"The flipside of the equation is that more people are investing in residential rental housing, with an increase in first-time landlords and independent property managers.

"Given the changing dynamics of the rental market, a review of this legislation is well and truly due. The government wants to make sure the Residential Tenancies Act strikes the right balance between the tenants' need for affordable and stable rental housing, and the commercial needs of landlords to manage their properties efficiently."

The newly-formed Department of Building and Housing has today issued a discussion document, Getting the Balance Right, and invites all those with an interest in the residential housing market to offer suggestions on how the act might be improved.

The department will gather people's views through written submissions, public meetings and focus groups. Submissions close on 18 February 2005 and public meetings will be held in Auckland, Wellington and Christchurch. These will be publicised on the department's website, www.dbh.govt.nz. Getting the Balance Right is also available on this website.

"I invite landlords, tenants, property managers and property investors to take the opportunity to submit their views on this legislation, so that we can make sure it works well for all New Zealanders," Margaret Wilson said.

Background information

What is the Residential Tenancies Act 1986? The act is the central piece of legislation that governs the rental housing market and the relationship between landlords and tenants. It covers rental housing in both the private and social sector, for instance rental housing owned by Housing New Zealand Corporation and local authorities. The legislation was designed to ensure an appropriate ongoing balance between the needs and obligations of landlords and tenants. This is the first major review of the Act.

How has the rental housing market changed since the Residential Tenancies Act was passed in 1986? More New Zealanders now rent their homes and proportionately fewer live in houses they own. Within the rental market, more individuals and families depend on housing provided by private landlords, rather than state or council landlords. This means that private rental housing is having a bigger impact on New Zealand’s housing, social and economic outcomes than it did in 1986.

What kind of people rent now compared with 1986? The family and individual circumstances of people renting now are more diverse than they were in 1986. Proportionately fewer young people are flatting away from home and a greater number of older people and more families with children are renting. Many of these people need or choose to rent for longer periods than they have in the past. Both tenants and landlords are more culturally diverse and for an increasing proportion, English is a second language. Some tenants have special needs for support beyond those normally provided for in standard landlord/tenant arrangements and some are particularly vulnerable or at risk.

How does this review relate to the Residential Tenancies Amendment Bill? This review is separate from the current Residential Tenancies Amendment Bill that is going through Parliament. The Bill amends some specific provisions within the current legislation. For example, it will extend the provisions of the Act to include boarding houses. The review of the Residential Tenancies Act involves a far more comprehensive examination of the legislation.

How does this review relate to the NZ Housing Strategy? This review is taking place within the context of the NZ Housing Strategy, led by Housing New Zealand Corporation. The NZ Housing Strategy discussion document, Building the Future: Towards a New Zealand Housing Strategy, raised questions about aspects of housing in New Zealand, including specific questions on the private rental sector. Any submissions, comments and suggestions on rental housing and the Residential Tenancies Act received during that consultation will be considered during this review.

What is the Department of Building and Housing? The Department of Building and Housing came into being on 1 November when the Ministry of Housing was renamed and additional building functions added. The department incorporates the functions of Tenancy Services and is responsible for administering the Residential Tenancies Act and the Building Act as well as a range of other building and housing related regulation. From
30 November it will also incorporate the functions of the Building Industry Authority and a range of other functions will be added over a 14-month period.

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