Renovation market set to warm up

A bill aimed at improving the conditions of rental properties could be worth millions of dollars to the construction industry over the next three years

The Residential Tenancies Amendment Bill, which will make ceiling and under-floor insulation mandatory in all rental properties, received unanimous support in Parliament on its first reading in December last year.

Excluding properties that cannot be practically insulated, all social housing where the tenant pays Income Related Rent will be required to be insulated from 1 July this year, while all other rentals need to be insulated from 1 July 2019, said Building and Housing Minister Dr Nick Smith. 

“This is an important, practical bill that will make homes warmer, dryer and safer for tens of thousands of New Zealanders without imposing unreasonable costs,” said Dr Smith. “I welcome the broad support across Parliament that recognises the strong link between the quality of housing and the health and wellbeing of families.”

The bill builds on the Energy Efficiency and Conservation Authority’s (EECA) Warm Up New Zealand: Healthy Homes programme that has seen the Government invest more than $500m insulating Housing New Zealand Homes and retrofitting 280,000 residential properties, including 45,000 rentals, since 2001.

However, it’s estimated that 180,000 rental properties would require upgrades to ceiling and under-floor insulation to meet the proposed standards, at an average cost of $2,800 per property.

The bill’s discussion document does raise concerns that some landlords would seek to cut costs by installing insulation themselves, which could result in health and safety risks and reduced benefits (or non-compliance) because of incorrect installation. However, guidance provided to homeowners will strongly encourage anyone installing insulation to make themselves aware of health and safety issues, while promoting the benefits of hiring a professional.

Other measures

Alongside the insulation requirements, the bill will also require landlords to install smoke alarms in all residential homes by 1 July. Measures have also been included to tackle sub-standard rental properties, Dr Smith said.

There are a small proportion of unsafe rental properties that have rot, unsafe wiring, leaky roofs and broken plumbing. These properties breach the current regulations. The answer is not more rules but better enforcement,” he said.

“The bill gives new powers to the chief executive of the Ministry of Business, Innovation and Employment to investigate and take direct action against landlords for breaking tenancy laws where there is a risk to the health and safety of tenants. We are also strengthening the protection for tenants who themselves take up these issues with the Tenancy Tribunal.”     

Dr Smith said the bill will also reduce the time it takes to confirm abandoned tenancies from six weeks to ten days, by creating a fast-tracked process enabling the re-tenanting of properties where a tenant has no intention of returning.