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Home / Business

Property Investors Federation claims to have plan to fix rental property crisis

RNZ
1 May, 2022 07:27 PM3 mins to read

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The Property Investors Federation has launched a five point plan which it says will fix the rental property crisis. Photo / 123rf

The Property Investors Federation has launched a five point plan which it says will fix the rental property crisis. Photo / 123rf

By RNZ

The Property Investors Federation has launched a five point plan which it says will fix the rental property crisis.

The plan includes harsher penalties for bad tenants and returning the bright-line test to two years.

Other key points include returning the right for landlords to issue no fault 90-day notices, and making mortgage interest tax-deductible.

Vice-president Peter Lewis said no landlord woke up in the morning and evicted their tenants for the sake of it.

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"Obviously, if you get rid of a tenant, then you are losing money on that property...The problem is that if you go and say to them you have to leave because of this particular thing that you're doing, human nature makes you say 'oh we won't do that any more, we'll reform, we'll do better'," Lewis said.

"But most people revert and we have seen this publicised recently with a lot of the Housing New Zealand tenants."

A public list of tenants who owed money after their tenancy ends, damaged the property or disturbed neighbours was also proposed in the plan.

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Lewis believed the cost of borrowing was putting off potential investors, too, meaning fewer rentals.

"A lot of that price increase is being caused by these taxation changes that are badly affecting a lot of residential landlords.

"And thus the first reaction of course is to put the rent up as far and as fast as possible."

The proposed changes were intended to help both landlords and tenants, Lewis said.

"I'm a landlord and I have been a landlord for 31 years. My ideal is to have happy tenants who I get on well with, co-operate with and it's a mutually beneficial arrangement.

"I provide quality accommodation for them, I'm responsive to their requests and their needs and in return, they pay me a reasonable market rent, just like any other business."

Lewis also believed New Zealand should trial a long-term tenancy option, like that currently available in Germany.

In this model, the landlord only supplies the bare minimum - the walls, floor, ceiling and infrastructure for water and electricity.

The tenant supplies everything else, from an oven and a fridge to light fittings and covers the maintenance of these things themselves, so they are not part of the rent.

"People have said to me when I have suggested it 'Oh no one would accept that' well, fine, perhaps they won't. But if it's available...we can see whether or not that's true," Lewis said.

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