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  1. #1
    Join Date
    Sep 2010
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    236

    Default TA with Rent increase clause - how to use them???

    Hello
    my TA have a clause that we review rents annually on 1st of January of each year.
    what are the rules on putting this clause into action?
    my new tenants moved in on 7th of august, but are behind on rent already - i want them to go, but would prefer them give 21 days notice to my 90 days, can I use the clause and increase the rent???? (i am sure they will rather go) and what is the rule with the implementation -- do I have to give the 60 days, or bang, 1st of january, the rent goes up, after sending them a letter?
    thanks....

  2. #2

    Default

    you cant increase the rent for the first 180 days of a tenancy, something youd know if you went to the Tenancy website http://www.dbh.govt.nz/faqs-tenancy-rent

  3. #3
    Join Date
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    Default

    If they're on a periodic, give them 90 days. You may be able to increase the rent but, why bother? Boot them out.

  4. #4
    Join Date
    Sep 2010
    Posts
    236

    Default

    hello
    I don't want to do 90 day notice as that seems like eternity, they will simply go and give 21 days notice, or just go without giving notice if I increase rent
    sorry but am I not reading the act, section 24 e correctly?
    'in the case of a tenancy which is not subject to annual rent adjustment, the rent shall not be increased within 180 days after the date of the commencement of the tenancy; and'
    ------ the way i see it, is if you don't renew rent annualy, the rent can't be increased within the 180 days but if you have that clause, giving the 60 days notice about the rent increase is fine ---- to be honest i never used it before, just have it in my tenancy agreement as a clause, and thought it could come in handy now....

  5. #5
    Join Date
    Jan 2004
    Location
    Wellington, New Zealand, New Zealand
    Posts
    456

    Default

    Looking at the RTA i see that it still reads 60 days notice is required where you have an annual review date (it doesn't read OR from subclause (i) to (ii) it reads AND

    (f) In the case of a tenancy which is subject to annual rent
    adjustment, no rent increase shall take effectó
    (i) Less than 60 days after the notice required by
    paragraph (a) of this subsection is given; and
    (ii) Other than on the specified date in any year or
    with effect on the next day on which any rent is to be
    paid within 28 days after the specified date in any year;


    Maybe you should consider getting rid of the 1st Jan annual rent review clause and if you have term tenancies have a clause to allow for rent reviews at any time over the tenancy tenure with 60 days notice and no earlier that 180 days since the tenancy start or last increase?

    I can't see a need or advantage for a clause to review rent on a specific annual date. Besides, Jan/feb are hot months for renting at a premium and DBH stats aren't updated until about 5th- 7th of each month and the way I see it, your rent increase date of 1st Jan shortchanges you from taking advantage of this premium rent period. Also, 60 days notice should have been sent late October (allowing 4 days postal notice as well) and using the DBH stats as a rent review tool or even other property ads at this part of the year you could be confined to always reviewing rents at a quieter and slower renting time.

  6. #6
    Join Date
    Jan 2004
    Location
    Wellington, New Zealand, New Zealand
    Posts
    456

    Default

    ps- Keep on your toes dealing with rent arrears regardless of whether you believe they will stay or go if you increase rent or not.

  7. #7
    Join Date
    Sep 2010
    Posts
    236

    Default

    well to be honest I just added the clause in last few contracts as after my last tenant from hell I only signed couple of tenants in august and september and I wanted something that would allow me to use it to get rid of them earlier if the things weren't going ok........upping the rent will make these go, so I will have my problem solved and will still be able to rent my beach house in high season for more $$ --- called the tenancy advise line, they said 60 days notice is fine, then again they have been known to be wrong....

  8. #8
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    Nov 2006
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    In this case, they most probably are. Periodic? Make it February 7th. Just to be safe.


 

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