As of this week, rental properties will be subject to new insulation requirements.
Over the next few years, landlords will also need to install fixed heating devices in living rooms and fans in bathrooms and kitchens. Owner-occupied properties are not subject to the same requirements.
The penalties for landlords who do not comply are stiff. You could be subject to a financial sanction if a tenant complains. Not meeting the new insulation standards could cost you $4000, for example.
In a probably not unrelated development, rents are hitting all-time highs.
This will only be of surprise to Ministers.
As reported by Stuff, Trade Me head of property Nigel Jefferies cited two reasons for the increases. First, there’s an overall shortage of rental stock. Secondly, the always escalating cost of compliance is being passed on in the form of steeper rents as landlords look to recover the additional costs they are having to outlay.
Of course, the first of these is the more important factor. If we had more properties available to rent than people wanting to rent them, owners would likely just have to suck up the additional costs. The fact that the new costs are being imposed at a time of shortage, however, means that landlords are confident of their ability to pass those costs on to the tenants who really have no option.
When there is a shortage of rental properties, it is a very bad time to increase compliance costs.