Labour strengthens renters' rights with limits on rent rises, 90 day notices video

David White/Stuff

Jacinda Ardern outlines Labour's plans for ramping up renters' rights at the Auckland home of the Lipsham family.

Labour is promising to strengthen the rights of renters by limiting rent rises to once a year and increasing landlords' notice periods to 90 days.

It is also planning to abolish "no-cause" tenancy terminations and require a formula for increases to be set in tenancy agreements, so that tenants know what to expect.

Letting fees would be banned.

​Labour leader Jacinda Ardern - who announced the plan at a home in Henderson, Auckland, on Sunday - said the moves would make renting a more stable and healthy experience for families,

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"Labour is committed to restoring the Kiwi dream of owning your own place. We also recognise that long-term renting has become a reality for more families, but the current law creates instability and insecurity for many."

Amanda Lipsham (left) said moving was disruptive for the schooling of their children, and was costly.

Amanda Lipsham (left) said moving was disruptive for the schooling of their children, and was costly.

Three out of four people under 40 years old rent.

It was not uncommon for renters to be forced to move once a year with little notice, and families were living with stress and anxiety as they tried to find another home in a tough rental market. 

Creating a 90 day notice period would give renters the time they need to move their lives, Ardern said.

Under current law, a landlord can give 42 days' notice if the property has been sold and the buyer doesn't want tenants, the owner or a family member wants to live in it, or it is normally an employee residence and is needed again for that purpose.

Arden said cold, damp homes were also a huge problem. 

"It's vital we improve the quality of rentals so our children no longer get sick or die from living in cold, damp and mouldy houses.

"We're going to fix this. We want our rental system to be fair, and take away stress for both tenants, and landlords." 

She said landlords should also feel secure knowing that their property is in good hands.

"If a tenancy agreement is breached, landlords should be able to access the tenancy tribunal and have action taken straight away."

Labour leader Jacinda Ardern talks to young performers at the Smokefree Rockquest on Saturday. After a heavy emphasis on ...

Labour leader Jacinda Ardern talks to young performers at the Smokefree Rockquest on Saturday. After a heavy emphasis on younger voters and education, Labour is turning its focus to housing.

Labour would make sure the tribunal was resourced to act quickly. 

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The plan would also look at ways to allow longer term fixed tenancies.

In those cases, it would create the option of a higher bond in exchange for the ability "to make a house a home" by making minor alternations, like painting a wall or hanging a picture, as long as the tenant returned the property to its original state when they left.

She reiterated Labour planned to pass its Healthy Homes Bill, whichwould offer landlords grants of $2000 for insulation and heating to ensure rentals were warm, dry, and healthy to live in.

"These measures will help stop our kids getting sick and dying of preventable diseases that have no place in a country like New Zealand."

She said the package was based on international precedents.

Labour shifts the balance towards renters with its proposed new rules.

Labour shifts the balance towards renters with its proposed new rules.

Amanda and Ed Lipsham, who shared a morning tea with Ardern and allowed their Henderson home to be used for the announcement, said they had been long term renters, and had moved three times in the last four years.

While they had not found it too difficult to find homes to rent, it was disruptive for the schooling of their children Jahvaan, 11 and Nevaeh, 9. It also cost $3000-$4000 to move each time, Amanda said.

Getting rid of letting fees in particular would help

"Definitely moving the kids around is the hardest part. Nevaeh ... has attended four primary schools now and she's still got another year to go."

Nevaeh said it was "complicated" to move schools.

Ed said owning their own home was a long term dream.

"At the moment it's pretty hard to get ahead."

He said it was frustrating.

"i feel like I'm letting my family down."

The plan follows two Labour moves aimed at property investors and increasing housing affordability.

It has pledged to increase from two years to five years the so-called "brightline" test that triggers capital gains tax on investment properties, and is planning to get rid of negative gearing, which allows property investors to offset their other income against losses on rental properties for tax purposes.

Ardern has also said Labour will review the tax system and look at a possible capital gains tax.

National has attacked her plan, saying it does not give voters certainty about what tax changes are ahead.

Labour is also promising to lift housing supply by building 10,000 affordable houses a year for 10 years, to on-sell to first home buyers.

​Sunday's announcement also marks a shift of focus in Labour's campaign.

For the past week it has centred on young voters and education, promoting its policy to boost student allowances and phase in from 2018 three years fee free tertiary study.

Prime Minister Bill English said he had not seen a strong case for longer notice periods.

"This is a trade-off between tenants who may be behaving in ways that are quite unacceptable to neighbours or to a landlord. That's not uncommon."

On the other hand, there was a reasonable expectation of fair treatment.

"We would say the current law is about right."

Property Institute of New Zealand Chief Executive Ashley Church said that while moves to support the security and comfort of tenants were laudable, Labour's policies would scare existing landlords out of the rental market and make the current housing crisis even worse, particularly in Auckland.

"If you're an existing landlord - the deck is already stacked against you," he said.

The market had flattened, the Reserve Bank's loan to value restrictions meant investors' equity position was worse, and bank credit rationing made it harder to borrow for renovations.

Key points of Labour's renting plan:

* extend landlords' minimum notice periods from 42 days to 90 days.

* abolish "no-cause" terminations.

* limit rent increases to once a year, up from six monthly now.

* set the formula for rent increases in tenancy agreements.

* ban letting fees.

* allow minor alterations, such as painting or hanging pictures, if a higher bond is paid and property returned to original state.

* Comments on this article have been closed.

 - Stuff


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