Know Your Rental Rights With The New NZ Tenancy Law

It's a big month for landlords and tenants in New Zealand as the latest tenancy law changes took effect last February 11, 2021. Whether you're a current tenant or thinking of planning to move in to a new place, it's easy to overlook the ins and outs of the New Zealand Residential Tenancy Act (RTA) when doing your research.

Getting into the rental market in New Zealand can be difficult. There's been a shortage of rental properties, and the competition to get picked by landlords is high. There's also been a post-Covid surge that made house prices a lot more expensive. In fact, the rate of home ownership dipped to 64.5%, the lowest level since 1951.

As a result, more people have postponed their dream of owning a house and have started to consider renting instead. If you're one of the renters, make sure you're aware of the latest news on the RTA  and learn your rights as a tenant before moving in.

What are the new NZ tenancy laws?

The advocacy for tenancy changes was strengthened at the height of the Auckland property market's 2015-2016 boom. This brought lots of stories of tenants getting kicked out of their place on short notice so that landlords could sell their homes at even better prices.

Tenants have expressed their frustrations on being reassured of a long-term stay, only to be given a notice months after. This drove the Labour-NZ First coalition government to improve the renting experience for all tenants and led their attention to tenancy law.

The law aims to give security to responsible renters and make them feel at home instead of just having a temporary place to live in — overall improving the lives and well-being of renters in New Zealand.

Fortunately, the reforms were worked on through Parliament last year, passing into law in August. One of the first changes was limiting rent increases to once a year as part of Phase 1, but most of the reforms didn't come into force until February this year.

Here's a quick summary of the tenancy changes included in Phase 2:

• Tenancy agreement terms

This change ensures a more secure rental tenure as landlords can no longer end a periodic tenancy without cause. A landlord can provide 63 days notice if they or a member of their family has to move into the property, and 90 days notice if they are putting the place on the market, doing major renovations, etc.

• Updates on fixed-term tenancies

Fixed-term tenancies will now be converted to periodic tenancies at the end of the fixed term. A tenant's required notice period to give to the landlord has also changed from 21 days to 28.

• Making alterations

If you like decorating your place to make it more homey and personalized, you can now make minor changes to your place by sending a request to your landlord, which they cannot decline. Minor changes include hanging pictures or artworks and baby-proofing. Landlords must respond to the tenant's request within 21 days.

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Note that tenants will be responsible for the costs involved with the requested changes.

• Rental bidding

You can no longer advertise rental properties without a rental price listed. Rental bidding is also now prohibited, and tenants should not pay more than the advertised amount.

• Name suppression

Now, both landlords and tenants can apply to remove names and other personal details from Tenancy Tribunal records if they are successful in their application for a suppression order.

• Assignment of tenancies and records

Requests to assign a tenancy to someone else must be considered, and landlords cannot decline without a sensible reason. Note that this doesn't apply to tenancies granted before February 11, 2021, if the residential tenancy agreement doesn't allow assignment.

Landlords must provide a signed tenancy agreement in writing with all the necessary information. Otherwise, it will be considered an unlawful act and an infringement offense.

• New measures from the Regulator

The Ministry of Business, Innovation, and Employment have new measures to encourage compliance and take action against those who will not meet their obligations.

• Tenancy Tribunal

Both tenants and landlords can apply for the removal of their personal details from the Tenancy Tribunal records. The Tenancy Tribunal can hear cases and award compensation of up to $100,000.

• Fibre broadband installation

The latest changes finally allow tenants to install Fibre broadband plans at their rental properties, and landlords must agree as long as it comes at no cost to them unless specific exemptions apply.

Read more information about the reform of the Residential Tenancies Act 1986

For Phase 3, the law changes will focus on tenants who experience family violence and a landlord's right to terminate a tenancy if a tenant has assaulted the landlord, owner, or a member of their family. These will take effect by August 11, 2021 or earlier, depending on the Government's decision.

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