Landlord e-newsletter No. 5: March 2008

Landlord seminars in full swing

The Department of Building and Housing is running education seminars to help new landlords get to grips with running their rental property effectively. These are interactive seminars with experienced mediators, landlords and banking representatives. The seminars are designed for landlords who have little or no experience in the New Zealand rental market.

These seminars are an opportunity to hear advice from experienced landlords, mediators and commercial stakeholders like the New Zealand Property Investors' Association, and ANZ or Westpac. They are also a chance to ask questions in a friendly environment.

Come along to find out what the Residential Tenancies Act means for landlords and the best practices for managing tenancies.

The seminars are free of charge, but places are limited and you must register to attend. Call 0800 TENANCY (0800 83 62 62) or email seminars@dbh.govt.nz to register.

Dates and venues are being uploaded daily. For a list of upcoming seminars, check out  www.dbh.govt.nz/landlords-events-contacts

Landlord packs for new landlords

The Department of Building and Housing has collated a range of forms and information booklets into a landlord pack.  The packs are distributed during the Department’s landlord seminars and through various stakeholders, such as local property investor associations.

The contents of the landlord pack are available at http://www.dbh.govt.nz/landlord-pack

If you’d like a hard copy of the landlord pack, email your postal address to landlordpack@dbh.govt.nz or call 0800 TENANCY (0800 836 262).

Swift mediation continues to save you time

Swift mediation service allows landlords and tenants to take part in mediation over the phone from their home or office.  Any agreements made with the Swift mediator are legally binding and can be enforced through the District Court.  More than 1500 mediated orders have been issued since July 2007.

When a Tenancy Tribunal Application is received it is reviewed by staff to determine if it is appropriate for the Swift service.

To be eligible to be considered for Swift, correct phone numbers for both parties must be on the application. An application may be directed for Swift mediation if it is a simple, single issue dispute and there is no counter-claim indicated or existing. A key consideration is whether the application can be resolved quickly.

If the other party to the application has not been told that you have filed an application (there is a question about this on the application form) then the matter is unlikely to be suitable for a Swift mediation.

You can read more information about Swift mediations at www.dbh.govt.nz/swift-telephone

New resource helping landlords choose property managers

“More and more landlords are asking us what their rights are in relation to their property managers,” says Jessie Henderson, Acting Client Services Manager.

The arrangement between a landlord and a property manager is not covered by the Residential Tenancies Act 1986.  It is a separate contract and so the terms of agreement must be negotiated and entered into carefully from the start. General principles of contract law apply in most cases where a remedial action is needed.

“We’ve created a general checklist of points to consider when choosing a property manager,” says Jessie. “Some property managers are affiliated to national, regulated bodies, and others are not. There are good property managers in both these camps,” she adds.

“We’ve also created a list of important terms to check in the agreement you are planning to negotiate with your property manager,” Jessie says.

You can see a copy of this new resource at www.dbh.govt.nz/selecting-a-property-manager

Showing a property to prospective tenants or purchasers

Section 48 of the Residential Tenancies Act 1986 provides for the landlord to enter the property to show it to prospective tenants or purchasers.

If the landlord wants to show prospective tenants or purchasers the property, they must get consent from the current tenant. The landlord should speak to the tenant and come to an agreement about arrangements that suit them both. 

The landlord needs to be mindful of the tenant’s right to reasonable peace, privacy and comfort.  The tenant cannot unreasonably withhold consent, but can place reasonable conditions upon the entry.
If a landlord has difficulty agreeing to viewing times with the tenant, they can apply to the Tenancy Tribunal for an order setting dates and times for the right of entry.

Maintenance versus inspection

Some landlords agree to do specific maintenance jobs as part of the tenancy agreement, such as mowing the lawn. However, when a landlord does this maintenance work, they are not allowed to take the opportunity to conduct an informal inspection at the same time. 

Sometimes in the course of doing the maintenance work a landlord cannot help but notice something that would normally require them to take action with the tenant if it was found during an inspection. It is critical for a landlord in this situation to refrain from raising the matter during the maintenance attendance. The best procedure would be to negotiate a right of entry with the tenant on the basis of wanting to do an inspection, or give 48 hours’ notice to inspect the property. The landlord can then attend again at that different time and look at the matter.

There is a general right of entry for a landlord in the case of an emergency. For example, if a landlord was conducting maintenance outside the property and happened to notice a fire through a window near the kitchen, then it would be reasonable for the landlord to enter the premises.

The importance of landlord surveys

The Department of Building and Housing surveys landlords and tenants each year and reports on property investment sector trends. The results of these surveys help the Department improve resources and services. You can read some of the Department’s reports on broader issues at www.dbh.govt.nz/rta-long-form-themes-and-issues

ANZ is conducting their annual landlord survey in conjunction with the New Zealand Property Investors’ Association. There are some specific questions about where landlords source information, including how landlords use the Department’s website and resources. To complete the survey visit http://survey.cbrak.co.nz/nzpif

Inland Revenue resource: residential property and tax

Inland Revenue has a new resource “Buying and selling residential property: what you need to know about your tax obligations.” This booklet is particularly useful for those who have recently become, or are about to become, residential property investors. The guide will help individuals understand whether they should be paying tax when selling a property and explains their responsibilities. The brochure is available from the IRD website