New compensation rules anger investors

Photo / File

A property investors' association has come out swinging against new rules making it harder to seek compensation when tenants damage dwellings.

From this week, landlords must prove their tenant wilfully or criminally damaged their property before they can seek any payment to cover damage, a situation that has left the Auckland Property Investors Association less than impressed.

Landlords in the city of sails say it will be them wading through student party detritis and opening the chequebook to fix the damage, under the new rules.

Punching roles in walls, setting fire to curtains or spilling wine on carpets might no longer have to be covered by tenants, they warn.

The change came after a court case between landlords Andreas Holler and Katherine Rouse, who own a house insured by AMI, and tenants Kenji Osaki and Tieko Osaki.

A forgotten pot of oil on the stove set fire to the house and the Osakis argued that as residential tenants, they should have the same immunity from liability as commercial tenants would.

A statement from the Auckland association describes the new situation as alarming.

"To give tenants exclusive possession - and therefore full control of how the properties are being used - but not financially disincentivise them when they fail to be responsible is tantamount to arming a child with a livewire and a lighter and shrugging your shoulders when the bomb goes off," the statement says.

"It is just not right."