NELSON PROPERTY INVESTORS ASSOCIATION
MARCH 2016 NEWSLETTER
PO Box 198 Nelson
NelsonPIA at xtra.co.nz
Our second meeting of the year is being held at the Nelson Suburban Club, Tahunanui Drive on Tuesday 22 March. This month we have Graeme Dick speaking on the Quail Rise subdivision that he is facilitating. I find it fascinating how so many complex issues of ownership, engineering, council approvals and marketing have to be brought together in order to make a project work. Graeme has been pushing buttons and pulling levers to make projects like this work for many years. The Quail Rise subdivision is a 153 Lot residential subdivision located on a prominent ridgeline above Marsden Valley Road, Stoke. The first stage of the project includes upgrading Marsden Valley Road and provision of services to the first 33 new residential Lots.
Davis Ogilvie is responsible for the engineering design, contract management, liaising with power / phone / local government agencies, certifying bank payments, as built of services, and cadastral survey through to issue of title.
Davis Ogilvie addressed numerous engineering issues including roading, earthworks, drainage, river crossings and structural alteration of an existing bridge.
Stage 1 completion is expected April 2016.
So by hearing what Graeme has to say you will get an insiders perspective of what is involved and perhaps what opportunities there are for investors. The meeting proper commences at 7.30 pm with the meal at 6pm. We will be eating in the Club Café. If you are coming to the meal please email Glenn by return email. The Suburban Club reserves seats on the basis of my bookings.
POLITICS AND THE MARKET
As regular readers of my newsletter might recall I have been predicting for some time that we are likely to see more political involvement in our industry as time goes by. These predictions are knocking at the door. In Dunedin and Auckland the local body politicians are making rumbling noises about the quality of rentals and we now have legislation being passed making insulation and smoke alarms compulsory for rentals but not owner occupied dwellings. In my opinion the officials have over simplified a complex issue which will turn into an enforcement battleground. Dwellings are not divided neatly into rentals and owner occupiers. Clearly many dwellings are occupied by people whose names are not on the titles. These people are not tenants and do not pay rent although they often pay something. I have been to the tribunal a few times trying to sort out issues of family occupying dwellings and not paying. The RTA excludes coverage of these tenancies and the tribunal will not adjudicate on such disputes. The same thing applies for people living in commercial properties. When there are loop holes in any legislation many people see this as a challenge to see who can leap the highest even if the cost of avoiding the rules might be greater than compliance. The activists are already clambering for more enhancements for rentals. “Cost efficient” heating is one obvious big cost. Just what is a cost efficient heater? I have had tenants using unflued gas heaters right in front of heat pumps. When asked why they say they cannot afford the risk of the kids running heat pump all the time resulting in a large power account. So they buy one bottle of gas each week and if the kids use it all up before the end of the week they soon learn to conserve it when they get cold. The cost of firewood in Nelson and many other small cities is way less than it is in Auckland. Will log fires be banned for the whole country because they are not cost effective in Auckland? Other expensive nice to have things come to mind that we are likely to see in the future. Water tempering valves and hot water cylinder restraints are required for new houses. Will we need to retrofit these? Will there be calls for upgrading fire rating of wall linings, glass doors to be 5mm and shatter proof, balconies, hand rails to current standards. All electrical wiring needs to be to current standards such as earth leakage relays and LED lighting. In the USA lead paint is a massive issue for landlords. Where does one stop?
P IN THE RENTALS
I am not aware of any law changes but the tenancy adjudicator recently spoke at a conference I attended and outlined the courts new rules. As many of you know the use of P is growing rapidly. I have observed it’s use in the full spectrum of rental dwellings in Nelson. I have attempted several times over the years to either end tenancies or claim extra cleaning costs related to the use of drugs or other illegal activities. In every single case my claims have been declined because the Tenancy Tribunal claims they do not have the authority to decide on illegal activities that the RTA refers to. This is for the District Court to decide they say. Because the court records are not readily available to landlords and often judgements come many months after a tenancy has ended it is a lost cause using clauses about illegal activities in the RTA . At the end of a tenancy a tenant is required to leave a property reasonably clean and tidy. I have presented evidence of cannabis use at tribunal and asked for the extra costs related to its cleaning. The adjudicators have all said pretty much the same that they are not skilled to determine what the evidence is of cannabis. Also tenants have claimed they did not use it. So claim not proven, case dismissed. Now with the growth of P testing and the huge cost of cleaning some tenants are claiming that just because you have a positive test after they leave they are not responsible because it might have been there before. So the adjudicators are saying they will not let you use positive P tests as reason for a claim. You need evidence of a negative test before the tenancy commenced. Additionally whilst it is not unlawful for a tenant to leave a property contaminated it is an unlawful act finable with a huge penalty for a landlord to let a property that is contaminated even if they did not know P had been used there in the past.
Oh dear where will all this end. I think I better stay under the blankets today and not even get out of bed.
Advance notice.
My friend Ron Hoy Fong has agreed to come and speak to us at our next meeting. Ron spoke a few years ago and he is fantastic. This meeting is scheduled for 26th April. This will be another not to be missed meeting.
MARCH 2016 NEWSLETTER
PO Box 198 Nelson
NelsonPIA at xtra.co.nz
Our second meeting of the year is being held at the Nelson Suburban Club, Tahunanui Drive on Tuesday 22 March. This month we have Graeme Dick speaking on the Quail Rise subdivision that he is facilitating. I find it fascinating how so many complex issues of ownership, engineering, council approvals and marketing have to be brought together in order to make a project work. Graeme has been pushing buttons and pulling levers to make projects like this work for many years. The Quail Rise subdivision is a 153 Lot residential subdivision located on a prominent ridgeline above Marsden Valley Road, Stoke. The first stage of the project includes upgrading Marsden Valley Road and provision of services to the first 33 new residential Lots.
Davis Ogilvie is responsible for the engineering design, contract management, liaising with power / phone / local government agencies, certifying bank payments, as built of services, and cadastral survey through to issue of title.
Davis Ogilvie addressed numerous engineering issues including roading, earthworks, drainage, river crossings and structural alteration of an existing bridge.
Stage 1 completion is expected April 2016.
So by hearing what Graeme has to say you will get an insiders perspective of what is involved and perhaps what opportunities there are for investors. The meeting proper commences at 7.30 pm with the meal at 6pm. We will be eating in the Club Café. If you are coming to the meal please email Glenn by return email. The Suburban Club reserves seats on the basis of my bookings.
POLITICS AND THE MARKET
As regular readers of my newsletter might recall I have been predicting for some time that we are likely to see more political involvement in our industry as time goes by. These predictions are knocking at the door. In Dunedin and Auckland the local body politicians are making rumbling noises about the quality of rentals and we now have legislation being passed making insulation and smoke alarms compulsory for rentals but not owner occupied dwellings. In my opinion the officials have over simplified a complex issue which will turn into an enforcement battleground. Dwellings are not divided neatly into rentals and owner occupiers. Clearly many dwellings are occupied by people whose names are not on the titles. These people are not tenants and do not pay rent although they often pay something. I have been to the tribunal a few times trying to sort out issues of family occupying dwellings and not paying. The RTA excludes coverage of these tenancies and the tribunal will not adjudicate on such disputes. The same thing applies for people living in commercial properties. When there are loop holes in any legislation many people see this as a challenge to see who can leap the highest even if the cost of avoiding the rules might be greater than compliance. The activists are already clambering for more enhancements for rentals. “Cost efficient” heating is one obvious big cost. Just what is a cost efficient heater? I have had tenants using unflued gas heaters right in front of heat pumps. When asked why they say they cannot afford the risk of the kids running heat pump all the time resulting in a large power account. So they buy one bottle of gas each week and if the kids use it all up before the end of the week they soon learn to conserve it when they get cold. The cost of firewood in Nelson and many other small cities is way less than it is in Auckland. Will log fires be banned for the whole country because they are not cost effective in Auckland? Other expensive nice to have things come to mind that we are likely to see in the future. Water tempering valves and hot water cylinder restraints are required for new houses. Will we need to retrofit these? Will there be calls for upgrading fire rating of wall linings, glass doors to be 5mm and shatter proof, balconies, hand rails to current standards. All electrical wiring needs to be to current standards such as earth leakage relays and LED lighting. In the USA lead paint is a massive issue for landlords. Where does one stop?
P IN THE RENTALS
I am not aware of any law changes but the tenancy adjudicator recently spoke at a conference I attended and outlined the courts new rules. As many of you know the use of P is growing rapidly. I have observed it’s use in the full spectrum of rental dwellings in Nelson. I have attempted several times over the years to either end tenancies or claim extra cleaning costs related to the use of drugs or other illegal activities. In every single case my claims have been declined because the Tenancy Tribunal claims they do not have the authority to decide on illegal activities that the RTA refers to. This is for the District Court to decide they say. Because the court records are not readily available to landlords and often judgements come many months after a tenancy has ended it is a lost cause using clauses about illegal activities in the RTA . At the end of a tenancy a tenant is required to leave a property reasonably clean and tidy. I have presented evidence of cannabis use at tribunal and asked for the extra costs related to its cleaning. The adjudicators have all said pretty much the same that they are not skilled to determine what the evidence is of cannabis. Also tenants have claimed they did not use it. So claim not proven, case dismissed. Now with the growth of P testing and the huge cost of cleaning some tenants are claiming that just because you have a positive test after they leave they are not responsible because it might have been there before. So the adjudicators are saying they will not let you use positive P tests as reason for a claim. You need evidence of a negative test before the tenancy commenced. Additionally whilst it is not unlawful for a tenant to leave a property contaminated it is an unlawful act finable with a huge penalty for a landlord to let a property that is contaminated even if they did not know P had been used there in the past.
Oh dear where will all this end. I think I better stay under the blankets today and not even get out of bed.
Advance notice.
My friend Ron Hoy Fong has agreed to come and speak to us at our next meeting. Ron spoke a few years ago and he is fantastic. This meeting is scheduled for 26th April. This will be another not to be missed meeting.
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