While coronavirus is dominating the headlines, an important piece of legislation that will protect New Zealand's 1.5 million renters is currently going through Parliament and alarmingly, National Party leader Simon Bridges says he would scrap many of the proposed law changes.
Bridges plans to reverse two major reforms in the rental market: first, the newly introduced Healthy Home Standards which include minimum heating, insulation and ventilation standards to address cold, damp and mouldy rentals that affect people’s health. Second, parts of the Residential Tenancies Amendment Bill, which aim to encourage longer, more stable tenancies by allowing renters to make minor property changes, restricting landlords to only raise rents every 12 months and prohibiting no-cause evictions.
In both cases these bits of legislation are the result of extensive consultation, have long lead-in times so landlords can adjust, and are very moderate by international standards. But, according to Bridges, on the ideological bonfire they must go.
His reasoning echoes the talking points of the nation's landlord representatives — that the reforms 'push costs up’ and landlords are forced to put up rents as a result. Simon is just looking out for us poor renters.
At the heart of this argument is a basic fallacy: that rents are dictated by landlord’s costs. If they were, we would pay half the rent on a flat that a landlord owned freehold versus one that they have a mortgage on.
Rents are determined by how much renters are able to pay and — as the market gets tighter and tighter and renters get more desperate — landlords, and property managers in particular, are ready to grab the opportunity to push rents up.
This tight market is not an accident. It's the direct result of 30 years of negligent housing policy by successive governments. As the public housing stock has shrunk and fewer people in the middle classes have been able to get into their own home, more and more people have ended up in the private rental sector.
Demand has soared but no government has built the houses we need to address it. Even when the government can borrow at close to 0% interest and we live in a culture where houses are "safe" investments, their solutions are an order of magnitude too small; thousands, not tens of thousands of houses. And even if the government did get the scale right, it will take years before we would see a levelling off in rents.
Rents will continue to escalate, with or without heat-pumps being installed, but at least if renters get a heat-pump and as a result a warmer, drier house, they’re getting something for their money, as well as potentially preventing some of the 1,600 deaths attributed to cold houses each year.
If political parties want to reverse the reforms they should be honest about why they are doing it and in whose interests — don’t pretend it's somehow in the interests of renters. If, on the other hand, they are serious about wanting to tackle rising rents then there are things they can do right now to make a difference.
Internationally, there is a strong correlation between the average length of tenancy and the frequency and amount of rent increases. The more often renters move, the faster rents rise. This is because landlords tend to adjust rents at the start of a new tenancy and are more reluctant to raise rents on settled tenants. New Zealand has one of the shortest average tenancy durations in the OECD and unsurprisingly, our rents are rising fast.
One simple solution to address this would be to legislate to require landlords to have a legitimate reason for ending a tenancy and to give tenants who meet their obligations the right to continue a tenancy indefinitely.
As luck would have it, the Residential Tenancies Amendment Bill before Parliament would do just that, but the fact that it is already headed for Bridges’ bonfire tells you everything you need to know about how much he really cares about renters.
We need this legislation because one in three New Zealanders is a long-term renter. Longer tenancies aren't just good for renters but for communities too; kids who move less often are more settled and do better at school and adults who move less are more engaged in their community. These connections matter, particularly when disaster strikes, but also to people’s quality of life.
Being forced to move can be traumatic and is always expensive. It is unjust that in many cases tenants have no right to even challenge a decision to end a tenancy. This legislation also goes some way to addressing this power imbalance, though it could still do with strengthening.
Right now, it doesn't do enough to prevent "eviction by rent increase" where a landlord can get around having to have a legitimate reason to end a tenancy by simply pumping up the rent. Landlords' representatives tell us that they won't do this, so they presumably won't mind it being outlawed.
Further, though the landlord is required to give a reason, some of the allowed reasons are open to abuse or exploitation. Those loopholes need to be closed before the Bill becomes law.
Finally, despite earlier indications, there is nothing in the Bill about allowing pets. For many renters, having a pet is a major part of settling into a home and sadly it has become routine for landlords to exclude all pets regardless of the responsibility of the owner.
Simon Bridges — a property investor himself — clearly has no qualms about throwing the 1.5 million New Zealanders who rent on his regulations bonfire. But these rental reforms are vital in improving people’s health and quality of life. One in three of us rent – it’s time renters have the right to a warm, dry house they can genuinely call home.
Have your say on the Residential Tenancies Amendment Bill before 25 March.
Robert Whitaker is an Organiser for Renters United, a grassroots organisation campaigning for a fairer deal for all renters in Aotearoa.