Auckland consistently ranks highly in lists of the world's best cities but is never number one. So what would it take to turn Auckland into a first-class city? This week the Herald begins a 10-day series examining some of the biggest hurdles Auckland faces, from housing and transport to entertainment and education. We look at what we are doing, what we need to do, and why Auckland's success matters to the rest of the country. In the first part of the series we look at housing
As President of the Auckland Property Investors' Association I regularly talk to property investors about a variety of property related issues.
•World-Class Auckland: How to make houses cheaper
One matter that has been raised lately with increasing frequency by tenancy commentators is security of tenure. The general tone of the commentary is how tenants need and/or want longer term tenancies.
Before I respond to these commentaries it would be useful to understand there are currently two types of tenancies provided for under the Residential Tenancies Act:
1. A fixed term
2. A periodic tenancy
Both of these tenancies are noted in the standard Residential Tenancy Agreement used by many landlords.
A fixed term tenancy is self-explanatory, an agreement is reached between the landlord and tenant for a tenancy to be 'fixed' for a set period of time. A periodic tenancy has more flexibility. It enables the tenant to give their landlord 21 days' notice if they choose to move out, whereas the landlord must give at least 90 days' notice to end the tenancy (specific exceptions allow for a shorter notice period of 42 days).
From my personal experience in renting properties and talking to many of our members, the vast majority of long-term landlords want long-term tenancies. Fixed long-term tenancies that is.
I believe the reason longer term tenancies are uncommon in New Zealand (because they are already provided for) is when it comes to signing on the dotted line, in my experience, most tenants will favour the flexibility of a periodic tenancy over a fixed term. In fact I have a tenant who has been in one of our properties for over nine years but still prefers the tenancy is periodic as opposed to a fixed term.
So where does this leave us? For tenants who are after the security of longer term tenancies, be pro-active, seek out long-term landlords and make the commitment to each other by entering into a longer fixed term tenancy.
Andrew Bruce is president of the Auckland Property Investors' Association.