Central Auckland rent increases vs LL added value

[RvB]

Hi everyone,

I've been a tenant in a large semi-maintained central Auckland villa for 3 years now. Never missed a bill, always on time with rent. Ill-maintained old villa best suited for the young professional type. LL's live overseas, we deal through a PM agency, who are very professional and friendly.

Now, I'm fully aware of the current housing situation in Auckland in regards to both renting and purchasing and that rent increases are most certainly well within the landlords rights, but I am currently facing my 3rd rent increase in 18 months, which is taking this property to over $100pw more than when I first moved in. While I disagreed with the first 2 in writing, this third has sparked me to head towards mediations with the TT.

Without getting into too much detail (who knows who could be reading this) heres my logic in disputing:
- The PM agency are great at fixing minor issues quickly. Any larger issues need to be OKed by the LL before any money is spent, and despite PM best practice recommendations, the LLs will often take massive shortcuts with devalue/destroy the property in order to save a buck. Bottom line - this property is in worse condition than when I first moved in, and through no fault of mine.
- Property itself is (and has never been) in line with the stats for this area. I discovered the property increases have gradually moved the house to match the uppermost quartile of the DBH stats.

I guess what I'm looking for is confirmation that I'm doing the right thing by disputing this and what the likely outcomes would be based on the members of this forum's experiences. From my perspective, the LLs are taking advtantage of the central rent increase while not adding any actual value to the property.

Cheers

[spaceman]

IMHO You haven't got a leg to stand on at the TT regarding the rent increases ..... Sucks to be you. If you think you're paying too much now you only really have one option and that is to find a new place to live

Good luck

Cheers
spaceman

[TheLiberalLeft]

Not a hope in hell. LL is within legal rights with increases and has done nothing wrong otherwise. Wasting the TT's time.

[LevenRiver]

If you've never missed a payment in 3 years, IMO the LL is silly to keep raising the rent like this - unless he is trying to force you out for some reason?

I would just hand in my notice and find another place. I suspect there would be plenty of landlords happy to take someone on, like yourself.

What suburb is the house in?

[PC]

Well you could vote Labour I guess...?
Capital gains tax will fix it apparently.

If you screw the developers and pummell the land lords - then the tenants all get to pay!

[Marej]

From my perspective, the LLs are taking advtantage of the central rent increase while not adding any actual value to the property.

Cheers

You appear to have some logic that for rent increases to be fair, the landlord needs to do have done something to improve the property..........Its just the way the rental market is at the moment.

[flyernzl]

To put it a bit less emotionally, the TT people will simply look at the current market rent for similar properties located within the same area.

Provided that your landlord is setting a new rent that is within reasonable distance of this market rent, they will not give a judgement reducing the rent he is trying to set.
Your time in the property and your record as a good tenant will have no bearing on their decision. They can only rule on whether a rent is within a reasonable range of the current market rent.

You could try looking around for a new home to rent, just to get a feel for the market. You may be (unpleasantly) surprised at the rents now being paid within the Auckland area.

[eri]

it is tough

let's say the old villa is in epsom/newmarket

http://www.trademe.co.nz/property/residential/for-sale/auction-465624945.htm

with a cv of $815,000

http://www.aucklandcouncil.govt.nz/EN/AboutCouncil/Rates/ratespropertysearch/Pages/yourratesfor20112012.aspx?vr=1910/00000031700/A&pa=13%20Maungawhau%20Road%20Newmarket

and you are paying rent of $815pw

as a return to the owner that's only about level with a bank term deposit

should the gov. be subsidizing your accom?

should the owner?

or should housing investment return less than bank deposits?

no easy answers

better to side-step the whole issue and buy your own place imho

[flyernzl]

as a return to the owner that's only about level with a bank term deposit

Its actually less than that.

Even if the owners are doing no maintenance at all, they are still paying overheads of rates (will be at least $4000 per year) insurance and 8% of rental + GST as a property managers fee.

That adds up to at least $9000 a year - $180 a week, even if they have no mortgage.

[Keys]

Well!

.....

Next please.

[Ahar]

RvB....you say it's a managed property

It's probably not the LLs that are putting up the rent.....it's the PM ........ who has probably sussed that you are good to pay

[Hec]

HI RvB,

do yourself bit of Market research. See if you can find better than what you have with out much hassle.
An answer to your concerns will pop up in no time ...

[RvB]

House is in Sandringham, its a 4bdrm+1bath and theyre charging me $680 with this increase. If it was a modern house I'd have no issue paying that, but it is so far from that its not funny. So based on this advice I'll back out of my TT and find a landlord who appreciates my tenancy.

Have been on the buying hunt for about 9 months now, have yet to find the happy balance between something I can afford and something that isn't a renovation nightmare.

Thank you all for the advice, it is very much appreciated.

[eri]

it's tough

the gov. has tried to limit housing investors from driving prices higher by removing depreciation

but even that small move may making it more difficult for public/private partnerships to build more homes

i think looking for something else is the right move

[KatieR]

Landlords are reading the newspapers regarding rents increases. I know three landlords who all put up the rent by around $50-60 a week, and all have had empty properties for about a month. You won't get anywhere regarding rent increases, so look for somewhere else but keep it friendly and say you would stay I they would give you a fixed term tenancy at $X . If you are right regarding their over-valuation, and are a good tenant, you may not have to move once they realise nobody else will pay that for their property.