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What one thing would you like the public to know about PI?

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  • What one thing would you like the public to know about PI?

    I have been asked to write a follow-up article for Stuff, about what I've learned through being a landlord.
    I'm well aware that there are dozens of wiser and more experienced heads on here, so what issues/facts do we, as a group, think that Joe Blow needs beating over the head with?
    My blog. From personal experience.

  • #2
    Tenants should have a WoF - national register.
    Good tenants get a good ranking and can be trusted.
    Lessor tenants have their track record visible.

    This matches the calls to have rentals comply to a WoF and landlords to be registered.
    The example is often made between WoF for cars and the propose WoF for rentals - safety of the customer.
    But what is not mentioned is that car drivers need a licence before they can drive the car.
    Tenants should also prove they have the skills before renting a property.


    • #3
      rights come with responsibilities

      if you can't responsibly look after someone else's house

      you have no right to use it

      landlords are providing an essential service

      but it's not "life coaching"

      if you expect a rental wof, because rental cars have them

      then be prepared to leave your credit card details and show your tenant licence, 'cause that's what you need to rent a car
      Last edited by eri; 06-10-2017, 06:46 AM.
      have you defeated them?
      your demons


      • #4
        The inability of "the system" to effectively hold people accountable for their actions.
        My one wish is that those of us with a court order for monies owed can take that order to the IRD and have the debt repayments deducted at the debtors source of income. It would then be up to the debtor to apply for an order for examination to get the deductions reduced.

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        • #5
          Without landlords making properties available for rent some 30%+ of people would have nowhere to live.

          It is fanciful to believe that without landlords buying these houses renters would then own these properties. While it is plausible that there would be more home ownership if people were FORCED to purchase a home vs. having the opportunity to rent there is ZERO chance the ownership rate would head to 100%.

          Landlords provide flexibility and options:
          There is a large number of people in society who value the opportunity to take short term occupancy of a property:
          i) Imagine the problem if you had to move from one city to another for a 6 month period for work, to support a family member who is sick or just to see if you wanted to live in the new location. You would have to buy a house (huge associated costs) then at the end of the period sell the house (even higher associated costs) unless you have the time/inclination to sell privately.

          ii) At different life stages you need different things, as a single young person your choice of home might be a studio/1br apartment close to town, you buy that, some short time later you meet a significant other get married and have children. Now you need to sell up and buy a suitable house for a small family.

          Landlords provide a stepping stone to independence:
          Image a situation where your kids finish school and
          i) Want to head off to university, the uni they choose is out of the city they live in but to be able to study there you need to buy a house/unit in order to have somewhere to live while you study - can you see the problem here?

          ii) Want to get a job and move out of home - getting a job might be relatively easy but with no landlords their parents will need to stump up the deposit for them to purchase their own place to live or they will need to live with their parents until they save the deposit for their home.

          Landlords allow reallocation of assets to suit the individual:
          If you're a budding entrepreneur looking to set up a successful business your efforts could be seriously hampered if you were first forced to allocate your capital into the deposit for a home before you had any money to allocate to your business idea. It could be claimed that by allowing these types of people to have rental accommodation they can spend their funds on creating innovative ideas that would otherwise not surface if the individuals were forced to work a job to pay the mortgage on a house/unit that they needed because they wouldn't otherwise have anywhere to live.

          just a few thoughts - far from exhaustive but maybe a starting point to modify the current narrative


          • #6
            That ther are NO 'tax loopholes' in rental property ownership.
            We are taxed exactly like any other business wih the same allowances for expenses, and have the additional burden of being unable to claim depreciation on our prime asset.


            • #7
              Originally posted by flyernzl View Post
              That ther are NO 'tax loopholes' in rental property ownership.
              We are taxed exactly like any other business wih the same allowances for expenses, and have the additional burden of being unable to claim depreciation on our prime asset.
              and unable to claim GST on any works done


              • #8
                The more landlords get smacked around in the media and by increasing compliance requirements the more they will exit the business. Then there are tax changes being put forward - capital gains tax, removing negative gearing / ringfencing - but only for one business. Funny that.

                Stuff's own article at the below link indicates a serious drop in available rentals -down in Wellington 65%, Otago 61%, BOP 52%, Canterbury 48%, Auckland 42%

                And from the same article -

                Richard Horne, director of rental agency*Managemyproperty, said*Wellington's rental market had been squeezed by owners selling their rentals and cashing up, as well as fewer people buying rentals in light of high purchase prices.
                "I would expect to have three-to-four times as many properties available right now as we do," he said.

                Could point out that a shrinking rental property pool is good for the landlords that hang in there. Tenants - not so much.


                • #9
                  The tax thing is the really big one. No need to confuse it with GST implications or Bright Line problems, people will tune out.

                  That, and a little math that a many landlords make little to no money (or a loss) on a month to month basis. We dont just get your $400+ per week to spend on caviar for our yacht guests.
                  AAT Accounting Services - Property Specialist - [email protected]
                  Fixed price fees and quick knowledgeable service for property investors & traders!


                  • #10
                    Originally posted by Anthonyacat View Post
                    The tax thing is the really big one.
                    Agree with Anthony. That is probably the single biggest mis-perception.

                    And it does not seem to matter how qualified the person is giving the opinion, or how many times that opinion is repeated: still the populist myth persists.

                    NZPA reported last week that Revenue Minister Peter Dunne and IRD officials appeared before the finance select committee and were quizzed about why people had the impression that there was some tax advantage in investments in rental housing.

                    Deputy Commissioner Robin Oliver was blunt: "The short answer there is none."

                    Rules about expenses for deducting costs such as interest, upkeep and maintenance, as well as paying tax on income were the same for investments in shares or anything else.

                    Mr Oliver said the rules were tougher for housing investment than other types.

                    "In fact under the housing case, the capital gains boundary is brought back a bit. There are tighter rules to what is a capital gain." Mr Oliver said.
                    Bob's idea also has merit. If, to rent a car, the hirer must have a driver's licence,
                    to rent a house, the tenant must have a tenancy licence.

                    Of course, that would be cried down, so perhaps best put as a question? Or series - depending on situation?

                    If the powers that be think all rentals should have a WoF, why shouldn't all tenants have a licence to occupy a rental dwelling?


                    • #11
                      Back to the original question: "What one thing would you like the public to know about PI? "

                      It isn't a 'get rich quick' scheme.

                      Like anything, being successful at it requires hard work, constant learning and a fair bit of patience.

                      I'm sure the most successful investors will fondly remember their early days of spending 40 hours a week renovating/hunting/managing properties whilst holding down a full time job. It is only with experience, systems and team work that it becomes easier - you get to know what you are good at and outsource the rest.


                      • #12
                        Reading this thread today gave me an idea worth thinking over.
                        The mention of a tenants license did it.
                        Here is the thinking.

                        If say i go to a company to do maintenance work or such I will have to complete and induction before being allowed on site.
                        I do work for Metlife Care for example and I must qualify myself or any of my representatives working there by sitting their online H & S.
                        Its actually not that difficult (well Ididn't think so and notched up 100%) but I am reliably informed that wasn't the normal. Results ran from 15% up.
                        Those that "failed" had to repeat and have to do follow ups. I repeat that it wasn't hard at all.

                        now that example starts me thinking that we as landlords should do something similar.
                        We should hand a prospective tenant a document that runs through the requirements to be a tenant and then have a questionnaire about that. It could be done online.
                        At the moment we all assume a prospective tenant knows their responsibilities and long ago when I looked after my own properties I had a tenancy agreement that set out all those things. Since I have used property managers they don't do this.

                        I know that Tenancy have this stuff but that isn't the same as having someone sit down, read the info and sign up to what they read. I see no reason why this should not be part of a tenancy agreement Provided the info is in line with the RTA. At the same time that document should include what the landlords responsibilities are. Again this is in the RTA.

                        We don't employ people without going through these things and yet we lend out a huge asset without making the effort.

                        Interested in what others think.


                        • #13
                          Originally posted by Viking View Post
                          Interested in what others think.
                          If you can remember / still have a copy, let's see the starting draft, please.


                          • #14
                            Originally posted by sidinz View Post
                            I have been asked to write a follow-up article for Stuff, about what I've learned through being a landlord.
                            I'm well aware that there are dozens of wiser and more experienced heads on here, so what issues/facts do we, as a group, think that Joe Blow needs beating over the head with?
                            I went to a neighbourly lunch the other day and no one knew I had rental properties. The discussion around the table turned to the level of rents and the consensus at the table was that the landlords were being greedy. Also, the other day I put the rent up on a property for the second time in a year - 6 months apart. The tenant, who is quite reasonable, said "Is this going to happen often (the rent going up) because we are getting to the point where we can't afford it". I wrote back "I need to keep the rents up to the market rental, because in the last year rates and insurance have been increased a lot and interest rates are going up. To this she replied "I completely understand with everything going up,etc.". I don't know whether most people would have reacted the same way, but I realised that it does often appear that landlords are being greedy, because people don't realise that the costs of owning the property increase all the time and someone has to pay for that. The view that landlords were greedy seemed to be the first issue that people focused on when they thought of what is happening in the area of rentals so I would suggest this could be a good topic to talk about to dispel that myth.


                            • #15
                              I think this is a good idea. And it's not just about paying your rent on time and mowng the lawns, but opening windows, brushing the paths and garages out, keeping the fans on to dispel the moist air, cleaning down the window sills, using the heat source because it costs more if you get sick, Being friendly to the neighbours, finding out when the rubbish bin is collected, being careful that the fridges and washing machines don't damage the vinyl, not having roasts cooking in the oven without being covered because it will cover the inside of the oven in grease, pulling out the oven occasionally to clean down the side of it and underneath it, carpet stain removable techniques, not drying washing inside and I could go on and on. These things are all part of running a household to get the most out of living there, but not all tenants will know them. I'm not sure if this is the kind of thing you had on your tenancy form, but I am actually going to make up a list of my own to give to my tenants. I haven't even thought of doing this kind of thing before. Great idea!