boarding houses and the dunedin city council

[sparxNZ]

Hi All, been a while since I last posted.
Wifey and I are looking at selling out of the Christchurch market and going for yield in a couple of hands on rent by the room investments in Dunedin.
We're pretty well aware of what's going to be involved in the management side of things but I really need some clarification on what is considered to be a boarding house and what is not by the DCC.

As I understand it from a Tenancies Act perspective a house is not a boarding house unless it contains one or more boarding rooms, and in order for a room to be a boarding room there must be an agreement with a tenant specifically stating that that room is that person's room - along with some communal facilities.
So I can see how RBTR properties avoid the GST and fire services compliance issues that come along with owning a boarding house and judging by the houses we've seen for sale down that way over the last year there are plenty of 6+ bedroom homes operating as RBTR properties without actually becoming boarding houses.

I have however heard that the DCC has some bylaws or district plan clauses which classify RBTR properties as boarding houses, but I've not been able to find them on the DCC website.
Does anyone have any experience in this area? I've managed to find a few old threads on PT forum with related information but nothing specific to Dunedin.

Just want to make sure we don't go ahead and buy a big RBTR house and end up with the DCC forcing us to fire rate every wall and ceiling etc etc.
Any advice greatly appreciated.

Cheers
Matt

[HiDAVE]

Hi Matt

How did you get on with resolving this question mate?
Do the laws differ much between separate counsels?

Cheers
Dave

[sparxNZ]

No mate, seems it's such a grey area nobody really knows. Sounds like a lot of LLs operate 6+ bedroom RBTR properties an non-boarding houses in compliance with the act but in non compliance with DCC bylaws and the DCC does not act on it.tDon't quote me on that though.

[Anita]

Timely topic though.

So, just wondering, even if it's on a rent-by-the-room agreement basis, it MUST adhere as to dbh / the Tenancy rules. Is this not correct.


Say in a hypothetical scenario there is a block of apartments ie 7 x ensuited studio rooms furnished with a kitchenette ( no hob) and also has a communal kitchen lounge etc there, for every ones use, a cleaner comes weekly to clean those up and there are , say 7 Tenancy Contracts on standard Tenancy Agreements. NOTE: some ensuited studio rooms are occupied by 2 friends or a couple. So number of residents in the whole block of apartment, ie 7 x ensuited studio rooms vary may be 9 -14 residents .


A) Is this structure of Tenancies legal and acceptable as to department of building under any category of Tenancy or Boarding Houses or flatmates ?

B) In the above scenario can a landlord impose a Fixed Term Tenancy to tenants in 7 x ensuited studio rooms ? Or can it be ended giving 48 hour notice?


Anything else to be aware of , any suggestions on those lines would be helpful.

[sparxNZ]

Ok go to legislation.govt.nz and go to the residential tenancies act and read section 66b very carefully. In particular the definition of a boarding house AND the definition of a boarding room.

Basically in the situation you described I would say if the individual agreements specify which room is the tenant's room then you're a boarding house. If each agreement only specifies that the tenant has the right to reside at the property then I'd say you're not a boarding house.

For a house to be a boarding house it must have one or more boarding rooms, for a room to be a boarding room there must be an agreement in place with a tenant stating that room is for his or her private use.

Local council bylaws, like the dcc one I heard about but never managed to find could restrict that flexibility though I suppose.

[Wayne]

By this logic it sounds like all 'rent by the room' arrangements are boarding houses?
I think there must be more to this.

[sparxNZ]

By this logic it sounds like all 'rent by the room' arrangements are boarding houses?

If you read the act, you could sum it up like this:

1-5 occupants with communal facilities and individual agreements stating that a specific room is for a particular tenant = NOT a boarding house.

6 or more occupants with communal facilities and individual agreements stating that a specific room is for a particular tenant = YES, a boarding house

6 or more occupants with communal facilities and NO individual agreements stating that a specific room is for a particular tenant, but with a generic agreement giving each individual tenant the right to reside at the property (read: "flatmate" agreement) = NOT a boarding house.

Heaps of LLs and other folks on this forum disagree, and believe that any property with 6 or more occupants is a boarding house and maybe under local or district bylaws in many places that is the case.
I've never seen any of those bylaws so I can only believe what I read in legislation:

66B Interpretation for this Part

In this Part, unless the context otherwise requires,—
boarding house means residential premises—

• (a) containing 1 or more boarding rooms along with facilities for communal use by the tenants of the boarding house; and

• (b) occupied, or intended by the landlord to be occupied, by at least 6 tenants at any one time

boarding house tenancy means a residential tenancy in a boarding house—

• (a) that is intended to, or that does in fact, last for 28 days or more; and

• (b) under which the tenant is granted exclusive rights to occupy particular sleeping quarters in the boarding house, and has the right to the shared use of the facilities of the boarding house

boarding house tenancy agreement means a tenancy agreement (as defined in section 2(1)) relating to a boarding house tenancy

boarding room means a room in a boarding house that is used as sleeping quarters by 1 or more tenants of the boarding house, and that is for use only by a tenant whose tenancy agreement relates to that room

contact person means a natural person or an organisation

facilities means the facilities provided by the landlord of a boarding house for the shared use by tenants of the boarding house, such as—

• (a) toilet and bathroom facilities:

• (b) cooking facilities:

• (c) general living, dining, or recreational areas:

• (d) laundry facilities:

• (e) lifts and stairways:

• (f) rubbish storage and rubbish disposal facilities:

• (g) appliances for heating or cooling premises:

• (h) communication facilities:

• (i) lawns, gardens, and outhouses:

• (j) any land or buildings intended for use for storage space or for the parking of motor vehicles

premises means the boarding house, comprising the boarding rooms and all the facilities of the boarding house; and includes any part of any premises.

[John the builder]

boarders are itinerant and transient by nature, so a long term lease (say 60 days?) may make them flatmates

The number of boarders may also be extra to the main family/household. You need to be sure that you are talking Building act RMA or TT

[sparxNZ]

boarders are itinerant and transient by nature, so a long term lease (say 60 days?) may make them flatmates

I'm only familiar with the RTA on the matter.
On the length of the tenancy s66 says a boarding house tenancy must be greater than 28 days to be a boarding house tenancy.
I'm unsure what kind of tenancy it is if it's under 28 days but I think I remember reading something along the lines of it being commercial accommodation (like a motel or hotel or something) and it becoming awfully complicated - straight into the too hard basket.
Can you point me to the relevant section of the RMA and Building Act? I'd be interested to see if they actually have any bearing on how a council might view such an investment property.

[John the builder]

building act is the definition in Code clause A1 2.0.2 that says a detached dwelling includes a boarding house with fewer than 6 people

and RMA is district plan definitions that apply to your area

The RTA s66

doesn't say that a boarding house is more than 28 days but a 'Boardinghouse tenancy' is created if 28 days is reached or intended

Is this correct?

[sparxNZ]

building act is the definition in Code clause A1 2.0.2 that says a detached dwelling includes a boarding house with fewer than 6 people

and RMA is district plan definitions that apply to your area

The RTA s66

doesn't say that a boarding house is more than 28 days but a 'Boardinghouse tenancy' is created if 28 days is reached or intended

Is this correct?

I cant seem to find that wording in the building act, the only instance of 'boarding house' in the whole document seems to be in schedule 2 pertaining to disability access. Would you be able to post a link?

I think we're on different pages with the duration of the tenancy. If we only use s66 of the RTA then a boarding house tenancy would be created in a boarding house where an agreement intended to last 28 days or more is implemented, that is quite evident. The thing with that is, the house has to meet the definition of a boarding house first which means it's got to have one or more boarding rooms and be occupied by 6 or more people. For a room in the house to be a boarding room there has to be an agreement in place with a tenant specifying that particular room as that person's room. If it's not specified it is not a boarding room, a house without a boarding room can't be a boarding house and a boarding house tenancy can't exist in a house that isn't a boarding house.