If you’re a landlord, you’re in business.
Your rental property might be the result of a clever investment plan or something you just fell into. Either way, if you collect rent on a rental home, you’re running a business and there are rules you’ll need to comply with.
What you need to know
Like any small business, if you rent a home, you have customers — your tenants — and contracts and laws you need to understand.
You have to be across the property, the people, the paperwork and the processes. And as with any business, things keep changing, eg:
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smoke alarms are now compulsory in your rental home and you must fit the right type in the right places
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all your new tenancy agreements must now include an insulation statement disclosing if there is insulation, where, what type and its condition — you must make all reasonable efforts to provide this information so tenants know what to expect
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you will need ceiling and underfloor insulation, where reasonably practicable, by July 2019, though some exclusions could apply.
If you don’t comply you could face penalties of up to $4,000.
Healthy homes — Tenancy Services website.
If your tenant has a Community Services Card, you may get a government insulation grant.
Landlords and other homeowners may also be eligible for help from their local council. Some councils will add insulation costs to rates and let you pay it back over several years.
Find out more at EECA’s energywise website.
What happens if you get it wrong?
Most landlords and tenants want to do the right thing.
The Tenancy Compliance and Investigations Team investigates serious breaches of basic housing standards, which can lead to enforcement action.
However, the government doesn’t need a tenant’s complaint to do something — it can act on behalf of a tenant in the Tenancy Tribunal and District Court, even without the tenant’s permission.
Tenancy Services
Tenancy Services, a part of the Ministry of Business, Innovation and Employment, holds bond money in trust and has resources and services to help landlords and tenants understand their rights and responsibilities.
If you’re having trouble, Tenancy Services will help resolve the dispute by talking to you about the problem, arranging mediation or referring you to the Tenancy Tribunal.
Tenancy Services can help you with:
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understanding different tenancy types
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making tenancy agreements
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paying rent, bond and bills
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understanding your rights and responsibilities
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doing maintenance and inspections
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keeping records
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giving notice and ending a tenancy.
The Tenancy Services website has agreements, forms and templates to make the paperwork easier. You can pay and lodge bonds online, and lodge complaints and Tenancy Tribunal applications.
Market rent calculator — Tenancy Services
Forms and templates — Tenancy Services
Disputes — Tenancy Services
Landlord News and Market Rent e-newsletters — Tenancy Services
26 Comments
I find it fascinating how many people own property and then cut as many corners as possible. It's very interesting but gets many people in trouble. A dull expensive obsession for some. In Auckland there's an obsession with creating high priced slums instead of increasing density with apartments.
How many know the rules or even follow them, and is I don't understand English an excuse
the worse thing is immigrants trust their own countrymen to treat them right and the opposite happens, there needs to be more awareness made for them so they know there rights.
as MBIE its a business and should be operating like one
All those 1970s high school dropouts who are now entering retirement with property businesses. Point being, to have been successful as a property investor up until the past few years, given past and current tax structures, has never required much grey matter, mearly being in the right place (decade) at the right time (age), coupled with perhaps an appetite for risk (ignorance is bliss however) was enough to suffice for a cohort which now seemingly needs education from the likes of MIBE. Good luck with that....!
Yvil, I'm not envious. I own property, commercial, rural and residential, coupled with managed funds, stocks and options and p2p lending investments. I acquired what I have by investing initially in property from 2010 onwards and watching equity swell to then diversify in to other investment products. So luck basically. I'd have no chance at all in repeating that strategy if I were starting out in 2017. Right place, right time. I acknowledge I'm privileged and not entitled, and certainly don't need reminding what rights my tenants have, they are well looked after, so they should be, and perhaps I feel that way as a number of my friends are not so fortunate and still find themselves renting. I also owned property investments whilst I was a renter, for many years.
If NZ immigration falls which over all I think it will with the current global upset form Trump. Rents will also fall.
We may see an upsurge of immigrants from the US but probably not that high as they don't like to travel beyond the bounds of their expansive homeland. I think we'll start to see a decline in the numbers of Brits and Chinese coming to NZ. Brit numbers will fall due to not being able to afford to move as the NZD is too high against the Pound. And the Chinese simply can't move their money due to capital controls, that will naturally inhibit them from wanting to move. But at least India is still strong so probably not much will change with their immigration numbers.
What a bunch of negative jealous people you lot are.
Soon as an article comes up, let's kick all landlords for providing a service to people who need or want to rent.
Property done correctly is a very worthwhile investment, there is none better in my mind.
If you don't want to own property then do whatever you are happy with but no need to bemoan others that are prepared to work at their property portfolio, to get ahead in life.
No it's not always beer and skittles but at least you have more control than other investment vehicles!
Which is why rules and regs have to be made so that investing in housing and FORCING so many to rent by having priced them out, have to be changed so that this parasitic business becomes far less popular and home ownership becomes far more attainable, as it used to be, or at the very least, tenancies can be such that people can call somewhere home even if someone else owns the shell.
I think it’s important to comment on whether the market is in a good state or not to invest in. Currently the market is in decline (Certainly for Auckland), with maxed out rents and major global political upheavals effecting peoples lives and therefore the markets we need to question how to improve things.
Oh bring me a bucket, what a load of self congratulatory BS... I'm a landlord too (became one semi accidentally) but don't kid myself Im doing gods work.
Oh and compared to other investments and businesses I've run in the last 10 years ( most of whichever actually employed people and paid weekly wages into homes) it's been money for old rope!
The proverbial chain smoking chimp wearing a fez in the peddle car could've made money too. My genius was being born at the right time and being able to actually buy my first ( decent) home in AKL 20 years ago at an income to loan ratio of around 2.5:1...easy compared to now and It's everyone thinking they're a property investor that is a huge part of the problem.
I don't buy the last comment. In what way do you have more control. You are at the mercy of the market as much as any other business.
Ive said this before, but as a business the returns from rental properties as an SME are rubbish. It just doesn't add up without capital gain. If the bank treated your business like any other business (9% interest on od ) the whole shooting match would be in the crapper.
As mvgsmf says, it's not God's work. I remember that Your Landlord tried to pass off landlording as God's work. It's a service that happens to take place in a market in which many tenants simply have no choice, for various reasons (including that teleworking is not widely accepted yet, so they can't just move to a cheaper town). In fact, you could argue that the rental market has some aspects about it that are similar to cartel behaviour.
Landlording has been profitable and attractive because of a combination of factors, such as low interest, high immigration, favourable tax treatment, negative gearing, some wiggle room in tenants' discretionary income to increase rents, low new build rate, and capital gains on the side. The market moves in cycles and the easy money will not always remain so. Good landlords are always needed, I'm not arguing that. But a downturn will sort out the professionals from those just in it for the money. Just look at the rental market in Perth now that the mining boom is ended; that shows how things can change.
Both our rental market and the housing market in general would be a much better state if our Government actually took measures to help protect its residents and citizens. We seem to be in a ludicrous situation in Auckland where most kiwi investors have been pushed out by overseas investors, leaving a shortage of homes since a lot of these properties are left empty.
I went for a walk around Farm Cove yesterday and was shocked at the number of clearly empty homes (Judging by the waist high lawns, detonating property conditions and over grown brown field sites where building had been knocked down). Well at least the French and the Canadian's have decided to take steps on taxing their empty homes.
Tempting but not sure how Squatters rights work in NZ? They actually clamped down on squatters rights in the UK though if you occupy and 'improve and therefore restore' a property by adding water and electricity, you can own it out right after twelve years (In the UK). This happened to a few properties in London when they were left abandoned by wealthy overseas investors.
Tragic what can happen: https://www.theguardian.com/society/2014/jan/31/inside-london-billionai…
https://www.theguardian.com/business/2013/may/06/foreign-buyers-luxury-…
MBIE have a cheek saying landlords need to run their investments like a business. It is about time MBIE started running their operation in a business like manner. Last year they demanded the Property Investor Associations fund their seminars. So the paid up members had to fund non members to attend their seminars. We had to pay their costs up front then get a refund for some of the costs. They then asked for a GST invoice when we were not GST registered. It appeared to me their accountants are not familiar with the IRD tax rules. Now they are asking if they can publish information in our newsletters without offering to pay! Not a very business like way to run a government department.
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