4.3 The End of a Tenancy

Overview

In New Zealand, the average length of a tenancy is approximately 2 and a half years and at some stage, every tenancy will come to an end. There are numerous ways as to how a tenancy can end. This is covered in section 50 of the Residential Tenancies Act (RTA). With the recent implementation of the Residential Tenancies Amendment Act 2020, tenants now have greater security of tenure and landlords must have a valid reason to end a tenancy. Previously, landlords could give 90 days notice to end a tenancy without any reason.

You can end a tenancy under the following conditions.

  • Either party gives notice. However a landlord must have a valid reason to end a tenancy. These are outlined in section 50 of the RTA.
  • A fixed term tenancy comes to a conclusion and both parties agree to end the tenancy.
  • Tenant acquires ownership of the property.
  • The tenant surrenders possession to the landlord and the landlord accepts.
  • By disclaimer, meaning any lawful person having power to disclaim.
  • A tenancy is ended by order of the Tenancy Tribunal.

 

Throughout this module, we will look at the many ways in which a tenancy can be ended and relate them to the relevant sections of the RTA. The guidelines will ensure that you remain compliant as failing to give the correct notice can have dire consequences.

We will look at the following situations.

  • When the tenant gives notice
  • When the landlord gives notice
  • Giving correct notice
  • Tenancies ending by mutual consent
  • Expiry of a fixed term tenancy
  • Fixed term tenancies ending due to hardship
  • Death of a sole tenant
  • Destruction of premises
  • Possession orders granted by Tenancy Tribunal
  • Boarding house tenancies.

 

In this lesson, we will not look at Short fixed term tenancies which are covered under section 7 of the RTA, Service Tenancies which are covered under section 53 of the RTA and tenancies granted by an education institution which are covered under section 53a of the RTA. We will also not be looking at the responsibilities of a tenant at the end of the tenancy as they are covered in the inspections section of the module.

Sections 50 to 66 of the RTA covers Termination of tenancies and recovery of possession.

For periodic tenancies, the most common section of the RTA that holds relevance to ending a tenancy is section 51 (Termination by Notice)

This covers all aspects around one party giving notice to the other party in normal circumstances. When giving notice, the party giving notice should ensure the following.

  • The notice has to be in writing
  • It identifies the property
  • Specifies the actual date the tenancy will end
  • It should be signed by the relevant party
  • If it is a landlord giving notice, they must state the valid reason for ending the tenancy

However, there is no special form that needs to be filled out when giving notice. If you do not cover off any of the above it does not mean that your notice will be held invalid.

 


4.2 All about property maintenance and care

Overview

The general poor condition of New Zealand residential rental housing has been well documented in recent times. As such, we are increasingly seeing a major overhaul around legislation that greatly impacts the condition of our rental stock. Legislation such as Healthy Homes and the Residential Tenancies Amendment Act 2020 will have a major impact on renting in New Zealand going into the future.

In recent times, we have seen the implementation of the following pieces of legislation that impacts the condition of the rental property.

This bill made it compulsory that all residential rental properties would have smoke alarms located in specific locations throughout the tenancy and set out technical and other requirements that the smoke alarms must meet. It also set out the requirements that all residential rental properties had to meet specific requirements for insulation.

The purpose of this bill was to ensure that all residential rental properties achieve minimum standards in regards to the following criteria.

  • Standards for heating and the minimum achievable indoor temperature being 18 degree Celsius in living spaces.
  • Standards for insulation, meaning that all residential rental properties must comply with the Building Code 2008 standards for insulation where it is reasonably practicable to do so.
  • Standards around ventilation. This means that bathrooms and kitchens must have extractor fans and windows must be able to be opened in the living spaces and bedrooms.
  • Moisture ingress and drainage. Moisture barriers are compulsory where it is reasonably practicable to do so. For example, if there is an enclosed subfloor space.
  • Draught stopping standards. Unnecessary gaps or holes in walls, ceilings, windows, floors, and doors that cause noticeable draughts must be blocked. All unused chimneys and fireplaces must be blocked.

The standards have come into effect as of the 1st July 2019 and there will be a transitional phase up to the 1st July 2024 when all rental properties must comply with these standards. The standards can be found via this link. Residential Tenancies (Healthy Homes Standards) Regulations 2019.

The table below shows you the key dates around compliance with the Healthy Homes standards. A breach of these standards is a breach of section 45 Landlords Responsibilities and this could mean exemplary damages of up to $7,200.

Take the Healthy Homes tour of our Project Property

Click on the picture. This will take you to our interactive Healthy Homes inspection

This link will take you directly to Housing and Urban Development standards about the requirements around the Healthy Homes standards.

The recent passing of this bill in July 2019 has resulted in the following changes in legislation. This has been influenced predominantly as a result of the Osaki case that led to tenants no longer being held liable for accidental damages. This has now changed. The bill has changed the following.

  • Tenant liability for accidental damages. The tenant will be liable for accidental damage to a maximum of 4 weeks rent or the amount of the landlord's excess for insurance held on the property, whatever is less. It is an unlawful act to try and claim more than what you are legally entitled to (See section 49D of the RTA)
  • contaminated properties which could be through Asbestos, mould or methamphetamine contamination. It stipulates that landlords cannot rent out a contaminated property and it also stipulates the landlord's rights of entry to test properties for contaminants.
  • Unlawful dwellings. Importantly with regards to the compliance of a property or dwelling, Tribunal will now have the jurisdiction to make rulings on tenancies that are deemed to be unlawful. In essence, the Tribunal will have the power to make decisions such as end the tenancy, refund rent or issue work orders to ensure that the property or dwelling has consented. This is stated under section 78A of the RTA.

All of this means that the Property Manager and landlord have to have a far greater knowledge of compliance and legislation relating to residential rental properties. Although a lot of what we do is people management, there is an increasing amount of legislation and compliance relating to property management.

Much has been debated about the conditions of rental properties in New Zealand and where the responsibility should lie. What is becoming more apparent is that renting out poorly maintained and non-compliant properties comes with risk and no Property Manager or Landlord should be managing or renting out properties that fail to comply.

Throughout this lesson, we will look at the following aspects of property maintenance and care.

  • Legal requirements around maintenance
  • How to select a contractor
  • Arranging maintenance work Categorizing the level of urgency
  • What we spend on maintenance
  • Pre-empting maintenance and troubleshooting
  • Future trends and technology

4.1 All about inspections

Overview

Whether you are a landlord or a Property Manager, the property will need to be inspected on a regular basis. There are different types of inspections that you will undertake during the duration of the tenancy.

For Property Managers, this is a major part of what you do. Approximately one third of your time at work will be spent doing inspections.

In this lesson, we will teach you the following.

  • The different types of inspections that you will undertake and the purpose of them.
  • The legal rights of entry that you as the Property Manager has.
  • Who is authorised to carry out an inspection?
  • Inspection etiquette, what you should and should not do.
  • Reporting and record keeping of the inspection.

Lesson 4.3: The end of a tenancy

In New Zealand, the average length of a tenancy is approximately 2 and a half years and at some stage,   every tenancy will come to an end. There are numerous ways as to how a tenancy can end. This is covered in section 50 of the Residential Tenancies Act (RTA)

  • Either party gives notice.
  • A fixed term tenancy is not renewed and the tenant must vacate.
  • Tenant acquires ownership of the property.
  • The tenant surrenders possession to the landlord.
  • By disclaimer, meaning any lawful person having power to disclaim.
  • A tenancy is ended by order of the Tenancy Tribunal.

Throughout this module, we will look at the many ways in which a tenancy can be ended and relate them to the relevant sections of the RTA. The guidelines will ensure that you remain compliant as failing to give the correct notice can have dire consequences.

We will look at the following situations.

  • When the tenant gives notice
  • When the landlord gives notice
  • Giving correct notice
  • Tenancies ending by mutual consent
  • Expiry of a fixed term tenancy
  • Fixed term tenancies ending due to hardship
  • Death of a sole tenant
  • Destruction of premises
  • Possession orders granted by Tenancy Tribunal
  • Boarding house tenancies.

In this lesson, we will not look at Short fixed term tenancies which are under section 7 of the RTA, Service Tenancies which are under section 53 of the RTA and tenancies granted by an education institution which  are under section 53a of the RTA. We will also not be looking at the responsibilities of a tenant at the end of the tenancy as they are covered in the inspections section of the module.

Sections 50 to 66 of the RTA covers Termination of tenancies and recovery of possession.

For periodic tenancies, the most common section of the RTA that holds relevance to ending a tenancy is section 51 (Termination by Notice).

This covers all aspects around one party giving notice to the other party in normal circumstances. When giving notice, the party giving notice should ensure that the notice states the following.

  • The notice has to be in writing
  • It identifies the property
  • It specifies the actual date the tenancy will end
  • It should be signed by the relevant party

However, there is no special form that needs to be filled out when giving notice. If you do not cover off any of the above it does not mean that your notice will be held invalid.

When and who can give notice under section 51, Termination by Notice

Party Giving Notice Reason for Notice Minimum days required
Landlord No reason (51.1.d) 90 days notice
 

Landlord

Landlord or landlord family member moves into property (51.1.a)  

42 days notice

 

Landlord

Landlord requires property for employee (51.1.b)  

42 days notice

 

Landlord

Landlord sells property property and vacant possession required to purchaser (51.1.c)  

42 days notice

Tenant No reason (51.2) 21 days notice

A notice to terminate may be given on any day and it does not have to cover a rent period.

Begin this lesson by clicking the first topic and marking each as complete as you work your way through.

Lesson 4.2: All about property maintenance and care

The general poor condition of New Zealand residential rental housing has been well documented in recent times. You are increasingly seeing a major overhaul around legislation that greatly impacts the condition of our rental stock.

In recent times, we have seen the implementation of the following pieces of legislation that impacts the condition of the rental property.

This bill made it compulsory that all residential rental properties would have smoke alarms located in specific locations throughout the tenancy and set out technical and other requirements that the smoke alarms must meet. It also set out the requirements that all residential rental properties had to meet specific requirements for insulation.

Probably, the greatest overhaul of the RTA since its inception in 1986. The purpose of this bill was to ensure that all residential rental properties achieve minimum standards in regards to the following criteria.

  • Standards for heating and the minimum achievable indoor temperature being 18 degree Celsius in living spaces.
  • Standards for insulation, meaning that all residential rental properties must comply with the Building Code 2008 standards for insulation were it is reasonably practicable to do so.
  • Standards around ventilation. Means that bathrooms and kitchens must have extractor fans and windows must be able to be opened in the living spaces and bedrooms.
  • Moisture ingress and drainage. Moisture barriers will become compulsory were it is reasonably practicable to do so. For example, if there is an enclosed subfloor space.
  • Draught stopping standards. Unnecessary gaps or holes in walls, ceilings, windows, floors, and doors that cause noticeable draughts. All unused chimneys and fireplaces must be blocked.

The standards have come into effect as of the 1st July 2019 and there will be a transitional phase up to the 1st July 2024 when all rental properties must comply with these standards. The standards can be found via this link. Residential Tenancies (Healthy Homes Standards) Regulations 2019.

The table below shows you the key dates around compliance with the Healthy Homes standards. A breach of these standards is a breach of section 45 Landlords Responsibilities and this could mean exemplary damages of up to $4,000.

Key development Date of takes effect
Legislation becomes law 1st July 2019
Retaining records of compliance 1st July 2019
Statement of intent of compliance on Tenancy Agreement or renewal 1st July 2019
Healthy Homes Statement on Tenancy Agreement or renewal 1st December 2020
Compliance with Standards for Boarding Houses 1st July 2021
Compliance with Standards for new Tenancy Agreements or renewals 90th day after renewal of DCT from the 1st July 2021
HNZ and community housing tenancies 1st July 2023
All tenancies 1st July 2024

This link will take you directly to Housing and Urban Development standards about the requirements around the Healthy Homes standards.

At the time of writing, this bill is still yet to be passed. There are changes in to this bill around the following.

  • Tenant liability for accidental damages. At the moment, tenants are not responsible for accidental damage to a rental property if the landlord is insured. This bill will change the current situation meaning that tenants will be liable for up to 4 weeks rent or the excess of the insurance claim.
  • contaminated properties which could be through Asbestos, mould or methamphetamine contamination. It stipulates that landlords cannot rent out a contaminated property and it also stipulates the landlord's rights of entry to test properties for contaminants.
  • Unlawful dwellings. Importantly with regards to the compliance of a property or dwelling, Tribunal will now have the jurisdiction to make rulings on tenancies that are deemed to be unlawful. In essence, the Tribunal will have the power to make decisions such as end the tenancy, refund rent or issue work orders to ensure that the property or dwelling has consent.

All of this means that the Property Manager and landlord has to have a far greater knowledge around compliance and legislation around residential rental properties. Although a lot of what we do is people management, there is an increasing amount of work and compliance around property management.

Much has been debated about the conditions of rental properties in New Zealand and were responsibility should lie. What is becoming more apparent is that renting out poorly maintained and non-compliant properties comes with risk and no Property Manager or landlord should be managing or renting out properties that fall into this category.

Throughout this lesson, we will look at the following aspects around property maintenance and care.

  • Legal requirements around maintenance
  • How to select a contractor
  • Arranging maintenance work to be carried out
  • Categorizing the level of urgency
  • What we spend on maintenance
  • Pre-empting maintenance and troubleshooting
  • Future trends and technology

 

Begin this lesson by clicking the first topic and marking each as complete as you work your way through.

Lesson 4.1: All about inspections

Whether you are a landlord or a Property Manager, the property will need to be inspected on a regular basis. There are different types of inspections that you will undertake during the duration of the tenancy.

For Property Managers, this is a major part of what you do. Approximately one third of your time at work will be spent doing inspections.

In this lesson, we will teach you the following.

  • The different types of inspections that you will undertake and the purpose of them.
  • The legal rights of entry that you as the Property Manager or landlord has.
  • Who is authorised to carry out an inspection?
  • Inspection etiquette, what you should and should not do.
  • Reporting and record keeping of the inspection.

Begin this lesson by clicking the first topic and marking each as complete as you work your way through.