Residential Tenancies Amendment Bill – Reaches Second Reading
On the 7th of July 2020, the Social Services and Community Committee (Select Committee) reported back to Parliament with their recommendations on the Residential Tenancies Amendment Bill. The Bill is currently in its Second Reading meaning that Parliament are going through the recommendations made by the Select Committee. After this process is complete the next stage is the Committee of the Whole House where the provisions of the Bill are examined in further detail. Once the final form of the Bill is agreed, it is reprinted to show any changes made and is ready for its Third Reading where the Bill will either be voted for or against. If the Bill is passed in its Third Reading, it will receive Royal Assent and becomes law. The Bill will come into effect, 6 months after the day it receives Royal Assent (excluding sections pertaining to temporary and emergency housing that will come into effect the day after the date on which the Bill receives Royal Assent).
Earlier this year REINZ made written and oral submissions to the Select Committee on the proposed changes to the Residential Tenancies Act 1986 via the Bill. One of the proposed changes that REINZ advocated against was the proposed removal of the landlord’s right to use no cause terminations to end a periodic tenancy agreement. REINZ submitted that the proposed anti-social behaviour clause did not provide sufficient scope to warrant the removal of no cause terminations and therefore, recommended that these two changes be removed from the Bill.
Unfortunately, terminations of a tenancy by a landlord without grounds remains an unlawful act in the Bill meaning that under the Bill, the landlord’s right to use no cause terminations are removed while the anti-social behaviour clause remains.
REINZ also advocated against the automatic conversion of fixed term tenancy agreements to periodic tenancies (unless contrary notice given) however, this remains unchanged in the Bill.
Below are some of the additional recommendations made by the Select Committee:
Anti-social behaviour clause:
- • The Select Committee have made a recommendation that where a tenant challenges a notice by a landlord for anti-social behaviour, it is the landlord that needs to prove that the tenant’s behaviour was anti-social instead of the tenant disproving the anti-social behaviour. Contents of Tenancy Agreement
- • The Select Committee recommends that landlords who fail to ensure the tenancy agreement contains landlord-related information such as contact details and date of tenancy, are committing an unlawful act which will attract exemplary damages. Assignment and break-lease fees
- • The Select Committee recommends that where a tenant makes a written request for the landlord’s consent to an assignment and the request identifies, and includes contact details for, the proposed assignee, the landlord must respond in writing to the request within a reasonable period of time. Non-compliance by the landlord will mean that they have engaged in an unlawful act. Termination of periodic tenancies (further restrictions)
- • The Select Committee recommends that where a tenancy has been terminated to allow the owner or a family member to move in, they must move into the premises within 90 days.
- • It has also been recommended that where termination has been given to change the premises into a commercial premise, it must be used for a commercial purpose for at least 90 days (to demonstrate genuine intent).
- • Another recommendation is that where termination has been given to allow for renovations, the work must begin, or material steps towards it are to be taken, within 90 days after the termination date. Taking a material step means applying for regulatory consent, seeking engineering or other professional advice, or taking any other significant step (to demonstrate genuine intent).
- REINZ will continue to be updated on the progress of the Bill which we will pass on to you as they become available.
- As always Dan is available for any queries or concerns you may have and is available on 07 571 11025 or dan@taurangarentals.co.nz