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Minimum standards good for tenants

Minimum standards good for tenants

The NZ Property Investors' Federation generally supports the Residential Tenancies Amendment Bill, which introduces minimum standards for residential rental properties.

"Although the new regulations will initially be applied to rental property owners, it is obvious that Government appreciates it is tenants who will ultimately pay for the rental property improvements" says NZPIF Executive Officer, Andrew King.

The Bill will require all rental properties to be insulated by 2019, a timeframe that insulation installers are expected to be able to achieve.

The Bill recognises that some properties will be difficult and therefore more expensive to insulate, so it includes some exceptions to the new regulations. "This is quite a pragmatic move" says King, "as it means that some properties that can't be insulated will still be available to tenants and won't be lost to the rental pool. This is great as there is actually a shortage of rentals in parts of New Zealand, and we wouldn't want to lose any."

In a clever move, the Bill requires all landlords to specify the insulation in their rental properties. This creates a competitive environment and is likely to encourage owners to go beyond the minimum standard if they can.

If a rental property is already insulated, it will need to be at a level that meets the 1978 regulatory standards. If there is no existing insulation then owners will need to meet the current standard levels.

"There has been some questioning about this aspect of the Bill" says King. "However the cost of topping up existing insulation to current standards just isn't worth it. The cost is almost the same as completely insulating a property but there would only be a very minor improvement in efficiency."

An Installer at a recent Select Committee hearing confirmed that the cost of topping up an average rental property to current standards would be between $2,500 and $3,000.

The chart below shows the minimal increase in insulation efficacy from 1978 levels of R1.9 to current levels of R2.9.

Looking at doubling the level of insulation (rather than the 50% increase from 1978 levels to today), the author of the study said “does it really make sense to double your insulation costs to go from an R2.0 to an R4.0 and only gain an additional 2.5% efficiency? I don't think so. I really don't think you would see a noticeable change in your utility costs and certainly not enough to offset the cost."

The Diminishing Benefit of Extra Home Insulation, by James Fricker, B Mech Eng, CPEng, M.AIRAH, M.IEAus.

April 2002.


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