HHS Compliance #1: Heating requirements at a glance

Welcome to our Healthy Homes Standards Compliance Series.

In light of this week’s rollout of the Residential Tenancies (Healthy Homes Standards) Regulations 2019 (“the Regulations”),
we will be releasing weekly resources to help landlord comply with these Healthy Homes Standards (“HHS”). There will be a mix of compliance guides,
best practice protocols, link pooling, FAQs, video explainers and industry offers so please take the time to subscribe to our database if you haven’t
already or become a member if you like to take advantage of all of these resources.

Today we are tackling the HHS heating requirements. In a nutshell, the HHS requires that there be at least one form of fixed heat source that is capable of reaching the required heating capacity of the main living room to be installed in that main living room of the property.
Sounds straightforward enough but there are certain compliance nuances to pay attention to.

1. The standards in detail

Some background reading to consider for those who are not time poor and have an interest in the finer details of the Standards:

Note that the latter two resources above are intended as overviews. They are fairly brief and do not cover the finer details we feel are important for
landlords to pay attention to. Please do not use either as your sole source of information for the purpose of compliance.

If you are looking for a go-to guide that covers the essential information you need to comply with the HHS, download and use our HHS Compliance Guide #1 Heating. Note that this is a members-only resource, the download will follow once you
have logged into your account. Tenancy Services is also set to publish its own compliance guidelines for landlords by July 2019.

2. FAQ

1. So does that mean I have to put a heat pump in my rental?

Not necessarily. There are other forms of qualifying heaters. As long as the six criteria set out in the Regulations are met, you will be able to supply
that as the heat source for the purpose of HHS compliance.

2. How many heaters am I required to supply?

At least one that meets the Regulation’s requirements to heat up the main living room of your rental.

3. What about bedrooms?

You are not required to supply heating for bedrooms, only the main living room of the rental.

4. How do I know if the heater I put into the property is strong enough and capable of heating the room to 18℃?

Interestingly enough, the Regulations itself is silent on the 18℃ requirement that had been talked about all throughout the consultation process. Instead,
the requirement is for your heater or heaters to reach a ‘required heating capacity’ for the main living area (in essence the power required of the
heater to heat the room up to 18℃).

‘Required heating capacity’ is defined by the Regulations (complicated maths involved, details in Schedule 2 for anyone who is interested). HUD has
announced that by 1 July 2019 a Tenancy Services online calculator will become available to help landlords work out the required heating capacity of
any main living room. Our recommendation is for landlords to wait until the calculator becomes available before taking steps to comply (no point
putting something in now if it ends up being too powerful or not powerful enough).

5. Ok, so HHS compliance deadline gets phased in gradually from 2021, what about my obligation to provide heating now? I have heard that landlords are getting done for by Tenancy Tribunal for not supplying heating for their tenants 😱!

You are not wrong, the Tribunal has been coming down hard on landlords for failure to provide heating in various circumstances. Until 2021, we are operating
in a somewhat grey area vis-à-vis heating at rentals. Our expectation is that landlords will act on a case by case basis that is in line with the situation
at hand as well personal risk profile. That said, we strongly recommend all landlords to take a look at this recent piece we have done outlining the current state of affairs to give you an idea of how the Home Improvement Regulations
is being interpreted and applied by the Tribunal.

6. Will APIA be arranging any heat pump deals for its members?

Why yes! We are talking to suppliers right now. If you know any heat pump supplier or if you are one yourself, we would love to hear from you. Please email
us at [email protected] to get the conversation going.

7. I own an apartment unit with strict body corporate rules, what if the BC prohibits me from installing heat pumps inverters?

Couple of things to consider. Firstly, it is unclear at this stage whether you are obligated to install a heat pump. Wait until 1 July 2019 for Tenancy
Services’ online calculator to tell you one way or another. Secondly, if you are required to install a heat pump and your body corporate disallows
it then your obligations are modified to a lower standard. Download our HHS Compliance Guide #1 Heating for more information on the modified standards.

8. Are my compliance expenses tax deductible?

Sorry but that is a tax question we are not qualified to answer. We assume in general that a compliance expense has been incurred then that points to there
being no preexisting heat source at the rental property. The questions of deductibility and depreciability would presumably turn onto the capital improvement
vs maintenance debate. Please consult your tax adviser for better clarity. Email us if you like us to recommend
a qualified and experienced adviser who can help.

9. What are the penalties if I don’t comply?

Up to $4,000.

10. My rental is a fairly new building that meets the current Building Code, do I still need to comply with HHS?

Yes. Do not assume that Building Code = HHS. The HHS is a set of particular standards governing rental properties that are designed primarily with tenant’s
health and safety in mind. The Building Code does not take that approach (especially in the case of heating). While there may be some cross overs,
you are best to double check that you do meet the HHS standards.

11. What if I already have a heater installed in the main living area?

First of all, well done you! In that case, you will have to determine the heating capacity of the existing heat source and have your documents together
to prove that the heat source predates 1 July 2019. Then use Tenancy Services’ online calculator to work out the required heating capacity of the main
living room. As long as the heating capacity of the existing heat source comes within 10% of the required heat source advised by the calculator, you
are deemed as having complied. If that is the case, we recommend that you advise your tenant of this in writing and document the correspondence.

It is important for us that this HHS Compliance Series be relevant and speak to your everyday concerns as a landlord. If you have any HHS and heating related
questions please feel free to reach out to us by emailing [email protected] or txting 021678029. We will get together with our industry contacts and
do our best to source an answer for you. Stay tuned on our platforms, more compliance content coming!