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The NZPIF Finds Ditching Of Property Managers Regulation Disappointing

The recent announcement by the Government to abandon the Residential Property Managers Bill, introduced by Labour last year, has been met with disappointment, according to New Zealand Property Investors Federation President, Sue Harrison.

Numerous organisations, including NZPIF, invested significant time in submitting feedback on the bill, viewing it as beneficial for the industry. Many members of nationwide Property Investor Associations professionally manage properties, making it reasonable to expect financial regulation regarding the substantial rental payments flowing through Managers' bank accounts. The Federation supported the proposed licensing and regulation regime, emphasising the importance of enforceable obligations due to Property Managers handling other people’s money.

Peter Lewis, Vice-President of NZPIF, criticised the inclusion of self-managing property owners in funding the legislation costs as "unnecessary and unfair." NZPIF opposed the inclusion of self-managing landlords, often Mum & Dad Investors, arguing that it would further disincentive investing with additional bureaucracy.

However, the regulations were seen as potentially increasing uptake for using Property Managers, offering safeguards and building trust within the industry. Unlike property managers, private rental property owners do not necessitate such safeguards since the rent they collect is their own funds, posing no risk to third parties.

Acknowledging the necessity for knowledge in managing residential tenancies, the Federation developed an online education programme called RentSkills, which has been highly successful. The course is available to all of our members at no additional charge as part of their membership.

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While the regulations could have contributed to upskilling professional property managers, Harrison cautioned that, as with any licensing regime, there was no guarantee that trained and approved individuals would consistently demonstrate honesty and competence.

Regarding the reasons cited for scrapping the bill, Harrison emphasised that the ongoing costs would have been funded by charges imposed on the regulated parties, not tenants.

The Martin Jenkins Costs and Benefits analysis study estimated the incremental costs at around $160 million, with a small net benefit from the proposed intervention. Harrison predicted that the costs would ultimately be absorbed by owners, as property managers would need to adjust their pricing models to cover the legislation costs.

About NZPIF:

The New Zealand Property Investors Federation (NZPIF) is the premier professional body for property investors in New Zealand. With a commitment to advocacy, support, and education, the NZPIF strives to elevate industry standards, foster ethical practices, and provide invaluable resources to all property investors.

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