OK – so this is not an article about how to break the law – it is just a personal view of how some problem areas for Self-Managing or DIY Landlords can get you into trouble. Yes – Property Managers can also break the law, but normally they know more about property and tenancy law, have had training or have a Franchise/Real Estate Agency watching over them.
So here are my 5 top issues:
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Discrimination
Discrimination is unlawful when the reason for discrimination is one that is prohibited by the Human Rights Act.
For example, it’s illegal for a Landlord to deny a tenancy to a person because they belong to a certain religion, or to change an existing lease after it has been signed because the Landlord discovers the Tenant is unemployed.
When providing accommodation, it is unlawful to discriminate on the basis of:
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gender
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marital status
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religious or ethical belief
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race or colour
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ethnic or national origin – which includes nationality and citizenship
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disability – including physical or psychiatric illness
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age
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political opinion
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employment status – e.g. being unemployed or a beneficiary, or receiving ACC payments
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family status – including having/not having responsibility for children
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sexual orientation
What the Residential Tenancies Act says
This Act makes it unlawful for anyone to discriminate when considering whether to grant a tenancy or deciding to continue, extend or vary an existing tenancy. The Act prohibits discrimination when deciding to terminate or renew a tenancy.
A person cannot tell someone else to discriminate in any of these situations either. For instance, a Landlord would be acting unlawfully if they instructed an Agent not to rent to a single parent.
So you need to be careful in how you design your ads, how you vet applicants and what you say to prospective Tenants.
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No smoke alarms
Working smoke alarms or detectors are compulsory in all rental homes. New smoke alarms must be photoelectric and have a long battery life or be hard-wired.
I am constantly surprised when I visit private Landlords at their properties and see how many don’t have smoke alarms installed.
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Install a 10-year photoelectric smoke alarm in every bedroom
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Check they work every 3 months and at the beginning of the tenancy
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Replace faulty and expired alarms
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No insulation disclosure
Insulation Statements are now compulsory with all new Tenancy Agreements. Insulation will be compulsory in all rental homes from 1 July 2019.
A Landlord who fails to comply with the regulations will be committing an unlawful act and may be liable for a penalty of up to $4,000.
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Increasing rents too much
There are specific rules for how often and by how much the Landlord can increase the rent by. Landlords can increase the rent every 6 months and the size of the increase must be reasonable.
In addition, it would be illegal if the Landlord increases a Tenant’s rent without giving the proper notice, such as 60 days prior to the rent increase.
The rule of thumb is to review every 6 months and increase rents if justified – small and frequent is better than excessive and infrequent.
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Delaying maintenance
In an attempt to make a Tenant’s life uncomfortable or save money, a Landlord may refuse to make repairs to the rental property or delay actioning the repairs. The Landlord may also attempt to cut off necessary services to the Tenant, such as water, which is also illegal.
A Landlord is required to keep the rental property in a habitable condition, so it is illegal to refuse to make repairs that affect a Tenant’s health or safety. And it is best to use qualified electricians, builders and plumbers to do the work.
All appliances must be operating including heat pumps, garbage disposals as well as the major appliances like stoves.
