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Housing New Zealand has forked out more than $14 million in the past three years for maintenance on its Rotorua state houses - including $88,440 on one property.
It's a bill one expert finds ''extraordinary'' and would send most landlords broke.
Housing and Urban Development Minister Phil Twyford said the Government needed to make sure houses were warm and dry "so kids don't get sick from respiratory illnesses".
A Housing New Zealand spokesman said the largest spend in Rotorua of $88,440 involved methamphetamine decontamination, an exterior paint and energy efficiency work.
Other improvements were the provision of insulation, heating, curtains, fencing, security and ventilation.
Planning to build more warm, dry and secure state houses that met tenants' current and future needs in regional cities and towns, including Rotorua, was well under way, he said.
At the end of September, 16 of its 647 Rotorua properties were vacant.
''We'll be in a position to provide details about these extra homes with communities and interested parties early next year.''
But former Rotorua Property Investors' Association president Debbie Van Den Broek said
a maintenance bill for $88,000 that was not covered by insurance could easily cause bankruptcy.
Social housing (taxpayer funded) was needed for those people that the private landlord could not afford to rent to.
''We just don't have the bottomless pit of money that is required in order to maintain a roof over the heads of some people. Unfortunately many of these have children but really don't care about keeping a nice home for their children. It's often drugs, alcohol and parties that take first priority."
Last month the Government passed the Healthy Homes Guarantee Act that would enable it to set standards for rental housing quality.
Van Den Broek said good landlords provided warm dry homes but regulations were needed for the slumlords.
''I don't think insulation and heating will make houses any warmer for those that can not afford to heat their home and unless tenants open windows for ventilation the mould problem will actually be worse.''
The availability of cheap but unhealthy homes would disappear forcing people to pay more than they may be able to afford, she said.
Rotorua property investor Lindsay Richards said at the end of the day landlords were operating a business.
''The customer covers the cost because we are providing a service and doing it for investment purposes."
He supported insulation standards but said "99 per cent of landlords looked after their properties but the finger is pointed at the bad ones".
Insurance companies also required inspections to make sure the properties were not deteriorating, he said.
Twyford said the impact on rents from the Healthy Homes Guarantee Act would be minimal.
"That's because it involves a relatively small amount to spend, $3000-$5000 for heat pumps and insulation, which is a small cost for a valuable asset with a 15-year life span. Rental properties will bring in several hundred thousand dollars for their owners over this period."
Rents were set largely by supply and demand, he said.
"The coalition Government will be adding to the housing stock by building state houses and affordable homes."
Rotorua maintenance bill
2014-2015 year: $3,225,366
2015-2016 year: $5,070,836
2016-2017 year: $5,620,574
Source Housing New Zealand
Rotorua state houses
At September 30, 2017
25 one-bedroom
266 two-bedrooms
297 three-bedrooms
52 four-bedrooms
7 five-plus bedrooms.
Source Housing New Zealand