Included in the raft of housing reforms the new coalition Government is plotting are several switches to rental policies, which one local property investor hopes will patch up a crippled rental market.
These possible changes include the introduction of a pet bond, re-introducing 90-day eviction notices, and a staggered increase of interest deductibility to 100 per cent over the next few years.
The prospects of such changes have made renter representatives nervous, but property investors claim it will ease nationwide increased rent prices and drop in available rentals due to elevated costs for landlords.
Wairarapa has seen steep rises in rental prices over the past few years, according to economic consultancy Infometrics.
Data showed that Masterton’s rental affordability [the proportion of average rent to income] reached an all-time high of 22.5 per cent this year, compared to 19.4 in 2021.
Carterton’s rental affordability also had a steep climb, rising from 18.9 per cent in 2021 to 21.7 per cent this year.
Data on South Wairarapa rental affordability is not available through Infometrics.
Tenant advocacy organisation Renters United has voiced concern that the potential policy changes would aid landlords at the cost of stripping away tenant rights, citing that it would be easier to evict a tenant without reason and that lowering costs for landlords won’t change the current steep rents.
Renters United member Geordie Rogers told the media that there would be no benefits to renters from the proposed changes.
However, Wairarapa Property Investors Association President Tim Horsbrugh disagreed and said tenants would see the trickle-down benefits of proposed changes.
He pointed out that before Labour amended the law in 2020 so that landlords had to give a justifiable reason for eviction within 90 days, eviction with no reason was completed for less than 3 per cent of cases.
He said changing it back would mean a wider range of tenants would be accepted to rentals.
“No landlord wants to spend time, energy, and money on a tenant just to evict them,” Horsbrugh said.
“Everyone wants good tenants. Since the rules have been put in place, tenants with a checkered history – maybe they fell behind in rent or have been in prison – these people are really struggling to get into any private landlord’s property.
“The screening has increased significantly, and they’re not given a chance.”
Horsbrugh also said introducing a pet bond would alleviate the intensive screening process.
“With so many tenancies at the moment, people just have a blanket ‘no’ for pets because of cases in the Tenancy Tribunal where there has been obvious damage by a pet, and no reparations are ordered,” Horsbrugh said.
“It allows more landlords to take a chance on people.”
He believed that proposed changes would lead to more landlords coming back to the market and eventually increase the number of rentals available.