Landlords lament updated Bill
Landlords say their concerns about the Residential Tenancies Amendment Bill have been ignored. Melanie Carroll reports.
An update to the Residential Tenancies Act will reduce rental supply and worsen the housing crisis, says the Property Investors Federation.
However, the Tenants Protection Association said the bill just helped even up the balance between landlords and tenants.
The Residential Tenancies Amendment Bill has been through the select committee stage, and is headed for its second reading in Parliament, but landlords say their feedback has not been acted on.
Sharon Cullwick, executive officer of the Property Investors Federation, said one of the main concerns was the end of 90-day no-cause evictions.
‘‘We’ve worked out they’re protecting about 2 per cent of tenants that cause the antisocial behaviour, rather than the majority of people,’’ she said.
Under the bill, a bid to remove a tenant would go through the Tenancy Tribunal.
‘‘And you have to get three separate incidents, so it’s a lot of work just to even do that. Plus, by the time you get to the Tenancy Tribunal, it might be another four to six weeks, then it’s another 90 days on top of that, so the poor neighbours have got a long time living with someone who’s causing a real nuisance.’’
The difficulty meant that tenants considered potentially risky, for example younger people with no rental history, would find it harder to get a place to rent, she said.
Landlords would be able to end a periodic tenancy on various specific grounds, including existing grounds in the Act and additional grounds proposed by the bill, the Social Services and Community Committee said in its report released earlier in July.
‘‘This is designed to ensure that the tenants would know why their tenancy was ending and that a justified reason existed. It would also give tenants the benefits of security of tenure.’’
Landlords could give 90-days’ notice for a variety of reasons, including to allow the owner, a family member or employee to move in, or for renovations.
Penny Arthur, manager of the Tenants Protection Association, said the bill did swing the balance more towards tenants, but it had not been a level playing field to begin with.
With so few landlords already using the no-cause 90-day notices for antisocial behaviour, there was no need to get rid of it, Arthur said.
‘‘It’s going to protect a lot of people from frivolous claims against them. [Landlords’] concern is that people will be mildly antisocial – well, most people at some point are mildly antisocial. They’ve had a barbecue outside, that might have bugged their neighbours, is that enough for you to leave your tenancy?’’
The majority of tenants she talked to were in fixed-term tenancies, and it was only the landlords using periodic tenancies who needed to worry, she said.
Evan Whetton, senior solicitor at Morrison Kent, said there had been a big shift in favour of tenants under the proposed legislation, which the select committee had further strengthened.
‘‘Termination by 90 days’ notice without having to provide reasons has provided an important safeguard for small landlords to bring a consistently problematic tenancy to an end,’’ he said.
It would be hard for many landlords to give three notices within a 90-day period about a tenant’s antisocial behaviour.
‘‘This is a significant obligation which may be difficult for landlords due to strict timeframes, a lack of resources, or fear of potential repercussions either on themselves, their property or on neighbours,’’ Whetton said.
Cullwick said another concern was the rollover of fixed-term tenancies to a periodic tenancy unless a 90-day notice was given before the tenancy ended.
‘‘It means you need to be more onto your paperwork – normally if you’ve got tenants leaving on a certain day you’d expect them to move out on that day, you don’t expect to have to do more paperwork halfway through the process just to make sure they are going to move out on that day.’’
Whetton said the changes reduced the landlord’s ability to carry out forward planning. The time, expense, and risk of taking a matter to the Tenancy Tribunal would not be matched by the value of the bond available.
The number of unlawful acts and fines for landlords also increased. The current maximum fine for unlawful behaviour of $4000 would rise to a maximum of $50,000 that could be imposed on landlords.
Tenant penalties had not changed substantially, Whetton said.
The value of work that the Tenancy Tribunal could require a landlord to carry out to upgrade a property doubled to $100,000.
One improvement was the tightening up of associated people for landlords.
Under the bill, landlords with six or more properties faced larger fines and infringement fees than those with five or fewer tenanted properties.
Initially, a landlord who owned one property would have their number of properties bumped up by ‘‘associated’’ people – including a parent, child or in-laws – who also owned rental properties, with all of their properties treated as a common holding.
That had been reduced to a spouse or partner under the select committee recommendations.
Cullwick said 20 per cent of the association’s members said they would quit the rental market once the bill came into effect because they would have no control over their own assets and it would become too hard.
‘‘Everyone says that that’s great because it means that firsthome buyers buy those houses, but every house that gets sold to a first-home buyer leaves one spare person or people that were in that rental property that need to find a house, so you’re actually making the housing crisis worse.
‘‘I’ve been a landlord and a tenant so I understand them trying to make things better for tenants, but I just think don’t do it when we’ve got a housing crisis on.
‘‘Personally, I think it was working fine the way it was.’’
What was needed was more education for tenants, she said, about their rights and responsibilities.
‘‘This is designed to ensure that the tenants would know why their tenancy was ending and that a justified reason existed’’.
Social Services and Community Committee