August 18 2015
Obligations of both landlords and tenants
The start of semester two in student centres, like Dunedin, signals the beginning of the search for the perfect flat for the coming year. Likewise, landlords will be seeking tenants who will keep their investments in the black. It’s also a time when funds run tight, flatmates fight over the price of keeping warm in this very cold winter and their landlords hope that the rent continues to trickle into their account on time.
Knowing your rights and obligations is vital before entering into a rental agreement. Can you afford the rent if your flatmate departs? Is the property warm and dry? In Christchurch, will you need to move out for earthquake repairs?
For a landlord, there are other important things to consider. You are entrusting the tenants with your investment. Will the rent reliably cover the mortgage and rates? Can you afford urgent repairs when required?
If the relationship turns sour and parties can’t agree on a resolution, then the Tenancy Tribunal can assist. The Tribunal’s orders can be enforced in the District Court, but the process can be expensive. Before signing an agreement, keep these tips in mind to maintain a healthy landlord-tenant relationship:
- Pay your rent on time. Remember that if one flatmate fails to pay, your landlord is entitled to request the full rent from the rest of your flat.
- Your landlord may request a bond of up to four weeks’ rent. This bond must be lodged with the Department of Building & Housing within 23 days of receipt.
- Keep the property clean and habitable. It’s also a good idea to take photos of the property before moving in, particularly if there’s any damage.
- Ensure that all your flatmates sign the lease. If one of your flatmates leaves or is replaced, this should be recorded on the lease agreement, or in a new agreement, signed by your landlord and the new flatmate.
- You must follow any applicable body corporate or apartment rules. Your landlord also needs to let you know if these change at any time.
- Some tenancies are excluded from the rules outlined in the Residential Tenancies Act 1986. In these cases, include a clause to ensure that the Act will apply. Potential exclusions include when you live with a member of the landlord’s family, use the property for holidays, or for purchasers who have entered into an agreement to buy the property.
- Give your tenant 48 hours’ notice before an inspection.
- Provide the property to your tenant in a clean and habitable state. If your property is damaged by a natural disaster discuss with your tenant and your insurer if it’s safe for them to stay.
- Remove your belongings, and the belongings of any previous tenant, before the new tenancy begins. Note that you can’t discard a former tenant’s belongings, but you can charge them for storage.
- Advise your tenant of any ownership changes in the property and change of bank account details for rent payments.
- You must give 42 days of written notice to a tenant to depart if you or a new owner would like to move in. In all other cases, you must give tenants 90 days’ written notice to end the lease.
- Appoint a New Zealand-based contact before leaving the country for longer than three weeks.
Most importantly, the best way for a tenant-landlord relationship to thrive is by maintaining good communication. If you would like further tips or templates related to residential tenancies, talk with us or click here.
Changes from 1 July 2016
The government has recently proposed changes to the Residential Tenancies Act. These are expected to take effect from 1 July 2016 and include compulsory insulation (with exemptions available for eligible properties), compulsory installation and maintenance of smoke detectors, and fast track mechanisms to re-tenant a property where existing tenants have disappeared.