Background
The Residential Tenancies Act (RTA)
The RTA regulates the rental housing market by defining the rights and obligations of landlords and tenants. It applies to both private (for profit) and social sector landlords (such as Housing New Zealand Corporation, local authorities and charitable trusts). It provides a legal basis for the relationships between landlords and tenants. Critical to the RTA is a balancing of the social needs of tenants for housing with the business needs of landlords to manage their rental properties effectively.
Among the RTA's main features are that it:
- requires tenancy agreements to be in writing, and sets out what needs to be covered in a tenancy agreement;
- provides for bonds and rents including maximum amounts for bonds and restrictions on the number of rent increases;
- sets out the rights and obligations of landlords and tenants including a tenant’s rights to vacant possession and quiet enjoyment, a landlord’s responsibilities for maintenance and a landlord’s rights to enter the rental property;
- provides for the termination of tenancies including the circumstances under which tenancies may be terminated and the steps required to terminate a tenancy;
- provides for the Tenancy Tribunal to resolve matters of dispute; and
- provides for enforcement and offences, including enforcement of possession and other orders made by the Tenancy Tribunal.
It is eighteen years since the RTA came into effect. The housing environment has changed a lot since 1986. More people now live in houses they rent from private landlords. Amongst these people are more families and older people. Because of the increase in people living in private rental properties, the operation of the private rental sector is now more important to the housing and social outcomes of New Zealanders than it was in 1986.
In directing this Review, Government noted the importance of rental accommodation in the New Zealand housing mix. It is not Government’s intention to lessen the protections provided by the RTA. The aim is to ensure that the RTA continues to provide a sound basis for a sustainable rental housing sector that balances the business needs of landlords against the social needs of tenants and their families for affordable, stable and good quality housing.
Administration of the Residential Tenancies Act
The Department of Building and Housing administers the RTA. It took over this role from the Ministry of Housing on 1 November 2004 .
As part of its role the Department of Building and Housing provides services to landlords and tenants through Tenancy Services. Tenancy Services has 22 dispute resolution offices throughout New Zealand that provide information and advice, dispute resolution and mediation for landlords and tenants. The Tenancy Services Centre also processes all tenancy bonds and provides bond and tenancy advice via two 0800 numbers.
You can learn more about Tenancy Services, the Tenancy Tribunal and the Residential Tenancies Act at www.dbh.govt.nz.
RTA Review terms of reference
It is intended that the Review will lead to a RTA that is characterised by:
- the minimal necessary impact on the operations of the rental market;
- an appropriate balance between the needs and obligations of landlords and tenants;
- high levels of compliance with the RTA and easily enforceable rights and obligations (in-so-far as this is within the scope of the Residential Tenancies Act);
- an appropriate level of flexibility in regulation to accommodate the variety of residential rental transactions and relationships, and the development of future trends; and
- a style that is easy to understand, communicate and implement.
The Review is separate from the current Residential Tenancies Amendment Bill that is going through Parliament. That amendment is relatively minor, and primarily designed to extend the RTA to boarding houses. The Review will provide for a far more comprehensive examination of the RTA.
Connection to the NZ Housing Strategy
The Review is also taking place within the context of the NZ Housing Strategy, led by Housing New Zealand Corporation (HNZC).
The NZ Housing Strategy discussion document Building the Future: Towards a New Zealand Housing Strategy raised questions about housing in New Zealand , including specific questions on the private rental sector. Some of the people who made submissions on the NZ Housing Strategy and met with the Strategy team had comments and suggestions on rental housing and the RTA. These comments and suggestions concerned housing affordability, stable housing and rental housing quality, among other things. They will be considered during the RTA Review. You can learn more about the NZ Housing Strategy at www.hnzc.co.nz/nzhousingstrat/index.htm.
Scope of the RTA Review
The RTA Review is not occurring in isolation from other areas of government. Nor is it likely that all of the issues that arise from the Review will be addressed through changes to the RTA. This is because the RTA is only one of a number of laws and regulations that impact on housing in New Zealand . For example: the RTA does not cover provision of the Accommodation Supplement or the tax treatment of rental properties.
At the same time as the RTA Review, there are other reviews occurring that also have implications for the rental housing market. These include:
- a review of the Unit Titles Act by the Department of Building and Housing;
- a review of financial intermediaries by the Ministry of Economic Development;
- a review of the Real Estate Agents Act 1976 by the Ministry of Justice;
- a review of the New Zealand Building Code by the Department of Building and Housing; and
- a review of the depreciation rules by Inland Revenue.
It is likely that issues will be raised during the RTA Review that cannot be addressed primarily through the RTA. These issues will also be considered by the Review.