Government makes pro-investor property reforms
The Government has announced changes to the Residential Tenancies Act to encourage landlords back to the rental property market.
The changes will include:
- Reintroducing 90-day ‘no cause’ terminations for periodic tenancies, meaning landlords can end a periodic tenancy without requiring a specific reason.
- Returning landlords’ notice periods for ending a periodic tenancy to 42 days, when they want to move themselves or a family member into the property, move an employee into the property or sell the home as a vacant possession.
- Returning tenants’ notice period for ending a periodic tenancy to 21 days.
- Reintroducing landlords’ ability to give notice to end a fixed-term tenancy at the end of the term without requiring a specific reason.
The Government will introduce a bill to parliament in May, with the changes expected to come into effect in early 2025.
Why the Government has targeted housing supply
Housing Minister Chris Bishop said these changes would make conditions easier for mum-and-dad landlords, leading to an increased supply of rental properties and applying downward pressure to rents.
“The previous Government waged a war on landlords. Many landlords told us this caused them to exit the rental market altogether. It caused worse outcomes for tenants: rents up by $170 per week since 2017, the social housing waitlist increasing by about 20,000 families and thousands of families living in emergency housing motels. Our government is making sensible pro-tenant changes to the Residential Tenancies Act to help increase the supply of rental properties,” he said.
“We’ve heard from many landlords that, without the backstop of 90-day ‘no cause’ terminations, they were unwilling to take a chance on a tenant who may, for example, not have perfect references or a steady 9-5 job.”
Minister Bishop said the key to improving housing affordability was to use every possible tool to increase supply.
“These changes, along with restoring deductibility for mortgage interest on residential investment properties, are part of the Government’s plan to encourage landlords back into the rental property market to increase the numbers of rental homes available,” he said.
The coalition’s five-point housing plan
- Incentivise cities and regions to introduce pro-growth policies.
- Make rental conditions easier for both landlords and tenants.
- Increase competition in the construction sector and lower building costs.
- Improve social housing.
- Reform the Resource Management Act 1991.
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