Hawke's Bay property management firms react to proposed rental rules

Oxygen property management offices in Hastings. Photo / Supplied.

Hawke's Bay property managers are cautioning the Government to ensure a fair balance is struck between protecting renters' rights and those of property owners, after proposals to change regulations.

Either way, rents are unlikely to go down.

Housing and Urban Development Minister Phil Twyford this week urged landlords, tenants and other interested people to have their say on the proposals covered in a discussion document on reforming the Residential Tenancies Act.

The 66-page discussion document covers proposals on ending no-cause tenancy terminations while ensuring landlords can still get rid of rogue tenants, increasing the amount of notice a landlord must generally give tenants to terminate a tenancy from 42 days to 90 days.

Feedback was also wanted as to whether changes to fixed-term agreements were justified to improve security of tenure, and limiting rent increases to once a year

Tremains Rentals general manager Ruth Shannon however, pointed out that yearly rent increases would affect tenants "more than landlords" because they would be hit harder with bigger increases at every annual review.

"This could be a significant rise in a fast changing market. The more rules they put in place, the harder they will make it to own a rental property and rents will rise as a result of limited supply."

Oxygen chief executive Christian Casbolt said some recommendations appeared to be a good idea, but others needed to ensure a fair balance.

"The intention of some of the policies proposed are good but we have some concerns about practicality.

"The stuff around tenure for example - I understand the rationale behind it but equally you have to balance that with the rights of property owners as well."

Similarly, with proposals to allow pets in rental properties, he pointed out some home owners had been left paying for significant damage from tenants' pets, which were not covered by insurance.

"It's probably early days, my overview is just finding a balance that works for tenants and landlords. I'm certainly of the view that in the main the majority of landlords and tenants have the same ambitions."

Casbolt said the majority of its clients were small investors, owning, on average, just one or two properties.

That meant increased costs from regulation were a concern to them.

"Rents are subject to supply and demand. We're very mindful of the ability of tenants to pay rents, so that will always put a ceiling on how high rents can go.

"The mechanism is already there to protect tenants by using the Tenancy Tribunal." Official data from the Ministry of Business, Innovation and Employment shows the mean average rent in Hawke's Bay was $378 a week at the start of last month - just $29 a week more than July, last year.