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Less than 6 months to insulate rentals or face a $4000 fine

11 January 2019
For immediate release

REINZ warns landlords they have less than 6 months to insulate rental properties or face a $4,000 fine

As people slowly make their way back to the office, the Real Estate Institute of New Zealand (REINZ) is warning landlords that they now have less than six months to insulate their rental properties or they could face a fine of up to $4,000 from the Ministry of Business, Innovation and Employment (MBIE).

Any landlords who still don’t comply after paying the penalty, may face further action according to MBIE.

Bindi Norwell, Chief Executive at REINZ says: “From 1 July 2019 ceiling and underfloor insulation will be compulsory in all rental homes across New Zealand. That deadline is now less than six months away, and MBIE has warned that it will be proactively checking up on landlords to ensure their rental properties meet the requirements under the Residential Tenancies Act (RTA) by the deadline.

“Landlords need to assess their current insulation, check whether insulation can be installed and the install or top up their insulation as required,” continues Norwell.

“The insulation requirements were announced under changes made to the RTA back in 2016, and last year MBIE was already warning landlords that it would be increasing its enforcement capabilities and that it ‘made no apologies for their approach’ so landlords need to act now if they want to avoid a fine of up to $4,000,” warns Norwell.

“One of the main issues is that there are still a significant number of rental properties around the country that need insulation and the Insulation Association of New Zealand has already stated that it is gravely concerned about the number of rental properties still to be insulated,” points out Norwell.

“One other point that many landlords haven’t picked up on is that they then must ensure that all new tenancy agreements must include a separately signed insulation statement covering what insulation the home has, where it is, and what type,” she continues.

While REINZ has been making a strong effort to communicate with its members who are property managers, as there is no regulation and no governing body for property managers there is a high chance that a number of property managers around the country will not have ensured that their landlords meeting the requirements by 1 July. If the industry was regulated, this could reduce the chance of the legislation not being adhered to by rogue property managers.

REINZ has welcomed the insulation requirements as this will help to improve New Zealand’s housing stock and also improve the health and wellbeing of our rental population.

“With home ownership at its lowest level in 60 years, more and more Kiwis are renting, so it’s essential we protect the health of those renting to ensure we prevent respiratory and skin infections that can be prevented by inadequate housing,” concludes Norwell.

ENDS

Notes to editors

• As a rough guide, MBIE has suggested that the average cost for a professional installer to install both ceiling and floor insulation is about $3,400 +GST for a 96m2 property. This would increase if the property is larger

• Insulation can be installed in most homes in a day. Waiting times for assessment, and for scheduling the work, will vary depending on where you are in the country, and the current demand

• Landlords can visit the Insulation Association of New Zealand, the Energy Efficiency Conservation Authority or MBIE’s Tenancy Services website for helpful information in relation to the insulation requirements

• REINZ has been working with its property management members for some months now to help them ensure their clients (landlords) meet the 1 July deadline

• According to MBRI an estimated 67% of private rental properties currently met the standard (March 18 – the latest data available), an increase of just 7% since July 2016. Estimates suggest there are between 126,000 and 220,000 rental homes which still need to be properly fitted for insulation.


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