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The Faafoi announcement: 4 things for landlords to do right now

Monday, November 18, 2019

IMG CREDIT: Interest.co.nz

Yesterday afternoon the government outlined the next phase of its housing agenda which involves overhauling the Residential Tenancies Act once again. While we have come to expect significant changes to the RTA under this government, we consider that which was announced to cause such major disruption to the landlord-tenant dynamic as to further tip the balance of power away from landlords who, let's not forget, are the legal owners of these rental properties. 

Therefore, we feel that it is important for organisations like ours to offer a guiding voice for landlords during these stressful times: 

1. Keep calm: Expect to panic 
It is important to know that one press statement doth not a law make. Yesterday’s announcements merely put forth the government’s intentions - a wish list, so to speak. They are not statements of law. The legislative process is not yet trigged. There isn't yet a bill in front of Parliament. Until that happens, there are still a lot of salient details unknown to the public.
 
We’ve been here before. Every time anyone in the Beehive breathes a word against landlords, the internet voices become predictably irrational. Expect a wave of ‘experts’ making doomsday prophecies based on the flawed premise that all tenants are by definition bad and act with malice. They are not and they do not. Expect to be told that the end is nigh and that you should have dumped your portfolio yesterday. Both untrue.
 
Soon enough, new ‘industries’ will emerge offering solutions and guarantees that look to completely circumvent the new risks you now face. Some of these industries are legitimate, others are simply leveraging off your fear.
 
You are going to feel a raft of emotions most of which are not going to be super great. We recommend that you take no drastic actions and make no major decisions about your rentals when you find yourself gripped by fear and uncertainty. Remember this: There is no bill yet. 

2. Stay sharp: By all means, keep panicking

To be clear, we are not here to lull you into a false sense of security. Some of these changes Kris Faafoi talks about are nothing short of catastrophic for landlords. We don’t just want you worried, we want you to worry enough to take action. And we will be with you all the way. Our goal from here is to channel your anxiety into constructive actions and productive outcomes. 

The next few months are going to be confusing and emotional for a lot of us. Focus and act on the facts, not innuendos or hearsay (and there will be plenty of those around). Find your sources of truth and make sure you know what you should know. Things to know right now include: a clear summary outlining the substance of the proposal written by APIA Vice President, Peter Lewis who attended the actual announcement as well as a clear commitment from the NZPIF to continue with its advocacy efforts to push back against the harshness of these changes. 

Sign up to our newsletters (sign up for a free subscriber account if you are not already a member), follow us on Facebook, or join our members-only private Facebook group.  The NZPIF also pushes out regular communications to landlords and Tenancy Services has a newsletter to keep landlords up to date. 


3. Speak up: If you don't, no one else will
Trust us when we say this, now isn't the time to be cynical. Sitting out by staying mum is a sure-fire way of giving away the house (pun intended!). Start getting your head around the absolute imperative to speak up if you want a future in property investing. 
 
In the coming weeks, we will be developing and releasing resources to help you vocalise your views. We will be helping you with engaging with your local MPs, making submissions in response to the eventual bill, writing to media outlets and participate in social media dialogues. The time has come for landlords to speak up in a loud, clear and unified voice. Speak up and be with us. 

4. Carry on: Remember, business as usual 

The Faafoi announcement yesterday was nothing short of disappointing. Still, that doesn't take away from the fact that many of you reading this still have rental properties to run and tenants to look after. Don't let what you fear could come affect your ability to deal with what is already in front of you. Keep up with your inspections, keep crunching those numbers, reviewing your rents, chase up late-payers, talk to your team and improve your business practices.Many of us have worked far too hard for far too long to get to where we are today. It would surely be a big crying shame if we allow ourselves to be derailed and deflated just because Kris Faafoi stood at a podium and said a few words yesterday. 

So, chin up. Keep calm, stay sharp, speak up and carry on. 

If you agree with our message, please forward and share with your network.

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The Tenancy Practice Service and TPS Credit Control work closely with the Auckland Property Investors' Association. Our vision of bringing helpful resources, documents and high quality services to Auckland Property Investors and Property Managers is shared by APIA, so its a partnership that works well. 

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