Themes and Issues
Not all rental accommodation is covered by the Residential Tenancies Act
The RTA does not apply to all tenancies. While the types of tenancy excluded from the scope of the RTA are similar to residential rental tenancies, they have generally been excluded because :
- significant other services are provided alongside the accommodation and are part of the price paid;
- it would unduly limit freedom of action where there is a significant element of personal interaction or risk;
- it would unduly limit freedom of action where there is a clear over-riding public good, for example armed forces barracks and prisons (though in some of these cases the linkage with the residential rental market is tenuous);
- the accommodation service is of a temporary or transient nature and so is not seen as “residential”.
A few examples of situations that it does not apply to are:
- properties that are let for a fixed-term tenancy of at least five years, where the tenancy agreement states that the RTA shall not apply;
- units in retirement villages;
- student hostels;
- properties where landlords provide meals or services to tenants, the value or cost of which forms more than 20% of the rent;
- holiday homes;
- properties where one of the tenants is the landlord;
- properties where the tenant is a member of the landlord’s family.
Some of the tenancies excluded from the RTA are covered by their own legislation or regulation. Residents and operators of retirement villages are covered by the provisions of the Retirement Villages Act 2003. The interests of foreign fee-paying students (aged under 18 years) are protected by the Code of Practice for the Pastoral Care of International Students. In addition there is currently a Bill before Parliament to amend the coverage of the RTA to include boarding houses.
In cases where tenancies are excluded from the RTA and are not covered by their own legislation, the interests of landlords and tenants are covered by contract and common law rights and obligations, which they can enforce through the courts or the Disputes Tribunal. However, the degree of protection available, and access to justice, may not be as great as for tenancies covered by the Act.
An important question for the Review is whether or not the RTA should cover all tenancies, or whether tenancies with a significant service component should continue to be excluded. A decision to bring all tenancies under the RTA would in turn require consideration of whether the RTA should also cover the additional services associated with the tenancy (such as the provision of meals).
The advantage of applying the RTA to all types of tenancies would be a more consistent approach to regulation. Doing so would also mean that the dispute resolution and other services provided under the RTA would be automatically available to all types of landlords and tenants.
Some people have also asked whether the RTA should apply to relationships and disputes between tenants living within a particular rental household. The RTA does not, for instance, cover disputes between flatmates as to how they divide rent and other costs between themselves, or disputes between boarding house tenants.
Questions
- Should tenancies with a significant service component continue to be excluded from the RTA? Why?
- If tenancies currently excluded from the RTA were to be included, should the RTA also regulate the provision of associated services (such as meals)? Why?
- Should the RTA apply to relationships and disputes between flatmates or boarding house tenants?