House inspections could increase cost of renting

The cost of renting could rise if warrant of fitness tests on rental properties are implemented, says a Hamilton rental property expert.

The call comes after more than 90 per cent of New Zealand rental homes inspected in a pilot warrant of fitness test failed to pass.

The trial assessed 144 properties across Auckland, Tauranga, Wellington, Christchurch and Dunedin, found 94 per cent failed on at least one of the 31 criteria on the checklist.

Carried out by home assessment experts, the inspections looked at weather-tightness, insulation and ventilation, lighting, heating, condition of appliances and general building safety.

The top five areas the homes failed on were water temperature, lack of smoke alarms in bedrooms, lack of code-compliant handrails and balustrades, lack of a fixed form of heating, and security.

However, about 36 per cent of the homes inspected would require only a few minor fixes, estimated to cost between $50-$150, to pass the WOF.

Lodge City Rentals director David Kneebone said the concept of a warrant of fitness had merit. And while he can understand the calls for it to be implemented, he's not convinced they are necessary.

"By and large I feel the market is addressing the basic requirements - heating and insulation. Insulated homes are the first to rent as tenants are well aware of the benefits," said Mr Kneebone. "This has encouraged landlords to invest in these areas to attract and hold on to good tenants.

"I believe the trial WOF that has been undertaken has a checklist of over 30 items which seems a little over the top. My concern is that we could be creating a whole new level of bureaucracy. The 'inspection industry' has a lot to gain and once established, all sorts of new - and expensive - tests will emerge. I can see a time coming when every house will have to be tested for meth (methamphetamine) even when the very best of tenants have been in residence."

Mr Kneebone said he could see the cost of the checks rising, up to $1000. "Ultimately these costs will force rents up."

While Vicki McGuire, director of Vicki McGuire Property Management, believes the 31-point checklist is "over the top", she doesn't think the cost of the tests would affect tenants. "That's something the owners would have to wear outright."

She said if a warrant of fitness test was implemented, it should cover essentials such as insulation and heating.

"Whether a property is insulated - that's really important. I wouldn't want my children to live in a home that wasn't insulated. And I won't rent a property if there's no heating. Anything to do with health and safety - electrical and plumbing - should be on the list. But as for things like grounds or fencing, that should be at the discretion of the owner. If I didn't think a property was at a standard to rent out, I wouldn't rent it out. The concept is a good idea to an extent but it depends on how far it goes."

The assessment tool was developed by the NZ Green Building Council and the University of Otago, Wellington, with feedback and input from the five councils, and ACC.

"The trial was really important so that we could gain an understanding about what is going to work for landlords, assessors and tenants. For a housing WOF to work it has to add value for the landlords and we needed to actually trial the draft WOF checklist and methodology," said steering groups spokeswoman Dr Julie Bennett from the University of Otago Wellington.

The steering group analyse the results closely and investigate ways it can refine the proposed system before presenting it information to participating councils.