NELSON PROPERTY INVESTORS ASSOCIATION
AUGUST 2009 NEWSLETTER
PO Box 198 Nelson
Email Glenn for the meal bookings please. Bookings are not compulsory but it does help the caterer with setting up the tables and collecting all of the meal money.
THE MARKET
Nelson tribunal applications are up over 22% on the same time last year and mediation appointments are taking as long as thirteen working days for normal rent in arrears applications.
66% of my properties to let this week are vacant compared with the normal 10 to 20%. However the number of properties being advertised in the Saturday paper has dropped by 30% over the last month back to the traditional normal amount. I have let just on 30% of our vacancies over the last week but the number to let has remained about the same due to incoming notices. More tenants than ever before are giving notice because they have purchased a home. In many cases these are first homes for them.
So what does all this mean? Probably nothing much actually, apart from the fact I am busy and like the rest of you need another holiday!
THIS MONTHS TRUE UNEMBELLISHED STORIES FROM GLENN
From a foreign applicant. We want to rent your quality house but want to rip the carpet up and polish the floors. We know about these things because we have two rentals of our own.
From a tenant who is taking me to the tribunal. I want compensation for the garage door opener not working. We discovered after lots of effort and a long delay that she had fiddled with it and changed the code. She also wants compensation for the front door not being able to open with a key. This occurred after she asked for an extra slide security bolt be put on it and of course she would leave it double locked from the inside all the time.
On the slightly less than funny side of the equation.
From an owner client who visited her quality home for the first time after being away for four years. There was a bit of wear and tear but nothing major.
I am so pleased I did not sell my lovely home. If had sold it four years ago I would have invested the money in a finance company and likely as not lost the lot.
LEGISLATION AMENDMENTS AND REVIEWS
I made my own submissions on behalf of myself re the property manager’s review. It was interesting and good to see that at least two other Nelson property managers made submissions. One was a manager working for a Real Estate firm and one was a commercial property manger. The outcome was that once the new Real Estates Agents Act comes into operation there will be no regulations covering the operations of property managers. Who knows what changes in the industry will occur as a result of these changes. The Government’s view was there were already a number of controls and acts in place to punish those bad managers who stole money from their clients or acted incompetently. In my opinion we may well see more information given out by the likes of DBH or Ministry of Justice on owner’s rights and this may lead to a few more Dispute Tribunal applications against managers. After all the huffing and puffing it is business as usual for all the various competing businesses operating in this unglamorous industry.
The other major bit of legislation to have its first reading and proceed to select committee is our RTA.
I have made a submission on your behalf concerning this act. The aim of the NZPIF was to get a number of different submissions covering various points of interest. Interestingly enough there was no collusion to apportion matters of interest to the various parties. There are several nasty changes buried deep in the pages of changes that will mess up things for us but could not be easily refuted without looking to be a rotten slum lord. The major clause of concern is the bit that suddenly makes residential landlords liable for Health and Safety issues. Commercial landlords are already covered but the ACC act removes this from residential property. It is possible that a whole raft of claims will commence from tenants covering things like people getting sick or stressed from their homes. I understand in other countries this can be an ongoing irritant for landlords and property managers.
Here is my/ your RTA submission.
The Nelson Property Investors Association represents private landlords in Nelson. Our financial members are made up of residential property investors, Independent Property Managers, Real Estate firms operating property management divisions, Real Estate agents and Real Estate sales persons.
We all have a significant financial interest in the industry and need good tenancy laws.
The writer has extensive experience in the tenancy tribunal having made around fifty tribunal applications per year for the last three years. This year is tracking up to be slightly more than that.
The most significant change proposed relates to the introduction of a special class of tenancy related to boarding houses. I suspect most landlords have skim read these clauses because most of us are not involved in that industry.
The RTA amendments are silent on letting by the room. Letting by the room is a rapidly growing phenomenon. I suggest that a significant number of these establishments will straddle the two forms of tenancies of boarding houses versus normal tenancies.
Boarding houses have different standards for dealing with notice periods and handing of bonds. Having two sets of laws for very similar activities will lead to confusion, avoidance, and abuse.
Recommendation 1
The same laws should apply for handling of bonds for the all types of tenancies covered by the RTA.
Abandoned Goods
Section 62 is very difficult for landlords and lacks clarity and certainty.
The DBH publishes schedules of various cases and these indicate a very small number of applications for disposal orders as per section 62 (1) (b).
The laws that apply in some areas of the USA are worth looking at.
There some states have a law that states that tenants have a specified period to collect abandoned goods after which landlords may dispose of them.
Abandoned motor vehicles and parts there of are a significant problem. When the original act was passed it was very rare for motor vehicles to be left behind. This is now a reasonably frequent occurrence.
Having to safely store an abandoned motor vehicle or motor and then apply to the court for its disposal is an unreasonable and impracticable burden on landlords. Defining any unregistered vehicle or parts of as perishables would permit landlords to dispose of them immediately as provided for in section 62 (1) (a)
Recommendation 2
(a) Unregistered motor vehicles and parts of should be defined as perishables
(b) Section 62(1) (b) (ii) should be amended to read “After one month of storage of the goods the landlord shall be permitted to dispose of the goods as he sees fit”
Drugs on properties.
The incidence of illegal drug taking is increasing. The nature of these drugs is starting to damage properties. The manufacture of P and other things is of growing concern to all sections of society. It appears that landlords are being unfairly burdened with financial penalties associated with this without granting them any legal remedy to avoid it.
Section 40 (2) (b) States that tenants shall not use the premises, or permit the premises to be used, for any unlawful purpose.
In practice this clause does not permit landlords to readily achieve a termination of the tenancy. There is a grey area between the criminal court finding tenants guilty of drug crimes and the Tenancy Tribunal dealing with the associated issues.
Recommendation 3
Landlords should be permitted to present evidence of unlawful drug use at a property to the Tenancy Tribunal and Adjudicators upon accepting this evidence shall make an order terminating the tenancy.
Rehearings Section 105 and Appeals Section 117
These two sections are cause for deep dissatisfaction by some landlords.
Rehearings can be granted if a miscarriage of justice has taken place. Such applications are not unusual but rarely granted. The current practice of the same Tenancy Adjudicator hearing the request for a rehearing on a case that they have adjudicated always grates. It brings the law and the court into contempt and is not good for the industry despite the not infrequent insignificance of the case.
Appeals can generally only be heard if the amount in dispute is over $1000. It is noted that this amount has not been altered. Some high profile cases of interest have had awards of $990 granted by the adjudicator thus preventing an appeal. This is an abuse of the law. In other cases the issue at stake does not relate to a monetary amount.
Recommendation 4(a)
All applications for rehearings should be conducted by a different adjudicator to that which presided over the initial case.
Recommendation 4(b)
Section 117 (2) (b and c) should be struck out.
Disclaimer. Anyone stupid enough to act on advice or comments in this newsletter without thinking for themselves deserves to suffer the consequences.
JEFFREY TAYLOR, FOUNDER OF MRLANDLORD.COM INTERVIEWED ON CNBC
You do not need to be bilingual to understand and learn from this video. Click on this link and see what the other half of the world is up to. The similarities to our world are amazing.
http://www.cnbc.com/id/15840232?video=1187306298&play=1