Rents are being tipped to rise as a result of new minimum rental standard rules, which will require more insulation and a heater in every rented home.
But the Government said the new rules represent some of the most important steps it can take to improve public health.
Yesterday, Housing Minister Phil Twyford unveiled the changes at a rental property in Wellington.
From mid-2021, all rental homes will be required by law to have a heater that can heat a main living area to 18C.
Kitchens and bathrooms will be required to have extraction fans or rangehoods and the minimum level of ceiling and underfloor insulation would need to be at least 120mm thick, or meet the 2008 Building code.
Twyford said the new rules were some of the "most important public health changes the Government could make".
"The Ministry of Health says 6000 children are admitted each year for 'housing-sensitive hospitalisations'."
He said the new requirements would help address this problem.
The Green Party were supportive of the rules.
A commitment to ending "energy poverty" by ensuring every Kiwi has a warm, dry, secure home was part of the Labour/Greens supply and confidence agreement.
"I am thrilled that as part of our Confidence and Supply Agreement, the Green Party have worked with Labour to achieve a major increase in standards required for a healthy home," co-leader Marama Davidson said.
The new rules will officially come into force in 2021 and from July of that year, private landlords must ensure that their rental properties comply with the rules within 90 days of any new tenancy.
By July 2024, all rental homes in the country – including boarder homes and Housing New Zealand properties – would need to comply with the rules.
Although supportive of making homes healthier, New Zealand Property Investors' Federation (NZPI) executive officer Andrew King said the new rules would see rents hiked.
He said the new insulation rules would be the main driver of this.
King said the cost of bringing a home up to the minimum standards would be roughly $1500-$2000 per home.
The insulation material itself does not cost a lot, he said, but the cost of the labour will be high.
National's housing spokeswoman Judith Collins agreed.
She said rents have increased in many parts of the country over the past year and the Government's new rules would see rents climb even further.
"There will be some landlords who are going to say 'it's just not worth it for me to retrofit this property'."
Instead of renting the property, Collins said many would-be landlords would just sell it on the open market.
Tywford said it was possible that some of the costs would be passed on to tenants, but he said that cost would not be significant.
"But the cost of doing nothing is far too great for us as a nation."
-Private landlords will have until 2021 to make the required changes
-By 2024, all rental homes in NZ – including Housing NZ homes – will need to comply
-Rental homes will need to have a heater in the main living space
-Kitchens and bathrooms will be required to have extraction fans or rangehoods
-Many landlords will have to add more insulation to their houses to comply with the new standards