RSS Feed

Peter Lewis: Social housing and long term tenancies

Wednesday, February 01, 2017


At a recent seminar, Philanthropy New Zealand promoted the idea of private investment into social housing.

However, under the current Residential Tenancy Act legislation, it is unlikely that these efforts will be successful as there will be minimal return available to such investors given current rental legislation.

Contrary to public perception, residential property investment in New Zealand is a high work low margin activity. There are many requirements, obligations, and restriction imposed on residential landlords which ensure that landlording is exclusively a small-scale Ma and Pa activity. While commercial landlords are often large-scale businesses running under professional management, the landlord involvement required by the RTA would make residential investment along similar lines a profit-less activity.

Currently, under the residential Act, a landlord can offer either a periodic tenancy (which can be terminated at short notice by either tenant or landlord) or a fixed term tenancy which is intended to create a finite tenancy of just one or two years. No other types of tenancies are permitted under the Act as it is now written.

We believe that there should be the third option of offering a residential tenancy of some five or ten years duration, thus giving the tenant security of tenure. In return the tenant would be responsible for payment of all the overheads of the property (such as rates and insurance cover) in addition to their rent, and also would fit out the interior of the property with their fixtures and fittings at the commencement of the tenancy.

Thus the landlord would maintain the exterior of the building, and any interior maintenance or repair would then be entirely the tenant's responsibility, relieving the landlord of this burden and giving scope for large-scale professionally run residential rental business that could offer a marketable return on investment to the public market.

This form of tenancy, which is the norm available to tenants in such countries as Germany and Austria, given legislative approval here may increase the supply of social housing and go some way towards easing the housing crisis.

Peter Lewis is the Vice President of the Auckland Property Investors' Association. 


Recent Posts


finance ocr Editor's Choice heater property maintenance tenancy services initio tax property cycle election 2017 government letting fee wealth creation debt enforcement buying rules clnz building market cat How to wins beginner investor maintenance insurance banking investment strategy nzpif housing affordability letting HHGA Question and answer boarding house rental market Sponsored post heating cash-flow unitary plan short-term rental income management p lab principal and interest Holler equity off the plan twg report rent arrears television asbestos ring-fencing landlord rent increase extractor fan subdivision Market report positive cash flow bond form development tenancy issues holiday house HHS mortgage negotiation renovation property partners rent relationship ventilation house prices inspection buyer's agent warren buffett Tribunal case study property management shower dome sublease auckland LIM fixed-term tenancy Must knows damage speculator rental wof housing bubble Property (Relationships) Act trust watercare skill shortage smoke alarm structure auckland council Must know Guest blog airbnb trademe HSWA CCC Investor story first home buying insulation Investment tip scotney williams robert kiyosaki return parry v inglis education minor dwelling Kris Pedersen Mortgages and Insurance water bill meth contamination sale and purchase advice CoreLogic ird Jeff Bezos anz tenant personal growth lvr trespass property value interest only legal data security gluckman report winz Q&A TCIT bond rta reform productivity sale and purchas interest rates investor capital gain financial advisers act buying warm up new zealand market rent bad tenant ask an expert business Landlording cgt DTI tenancy tribunal privacy Standards New Zealand rta worksafe reserve bank


Introducing Our Partners
Principal Sponsor - Kris Pedersen Mortgages & Insurance logo Gold Sponsor - Barfoot & Thompson logo Gold Sponsor - CoreLogic logo Property Apprentice logo Keith Hay Homes logo The Insulation Warehouse logo The Renovation Team logo The New Zealand Property Investors' Federation logo
09 360 2376

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. 

The Auckland Property Investors' Association is a great organisation for those who want access to advice and information from a range of industry experts and partners. 

Mathieu Holt- Managing Director, The Tenancy Practice Service & TPS Credit Control
Through the Association I found the channels and methods to fund the purchase of property I never dreamed about. Grant Brown

All round it has been one of those things Neil and I felt was really worthwhile belonging to. We have learned so much it has just built our confidence in what we are doing.

Janice Bieleski
I read two articles in the monthly magazine that saved me over $5,000. That is my membership fee for the next 26 years and I am sure I will learn a whole lot more! John Duncan
Fantastic organisation. The networking opportunities are brilliant and provide us with information and opportunities that cannot be obtained anywhere else. We learn something new at every meeting and we've been in this game for nearly 20 years. Pauline and Gyanen Kumar

I find the information obtained from various APIA meetings very useful in guiding my own property investment and rental management.  I also enjoy the networking opportunities with like-minded investors.  I am inspired by other investors’ success and find the more experiences and knowledge that I share with others, the more confident I become.  

Thanks to all APIA event organizers and administrators for your brilliant work. 

Stella Shao

I like talking to people and learning from their experience because it gives me the confidence to invest well. I think it is a knowledge thing. I now know I am doing things the right way.

Stephen Weatherall

My APIA membership has become a total success.

Every time I attend a monthly or regional meeting I come away with so many useful and positive tips that have added value to my property investments and management.

Not only that, the website is a great place for practical advice and useful information. It has now evolved into an important resource for my business.

Talk about value for money! The discounts I have been getting at Bunnings when I present my APIA membership card have more than paid for my annual subscription!

Tim Duffett, Plan A Investments Limited