HNZ targets investors

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Housing New Zealand should stump up with more rent if it wants to win over landlords.

Monday, April 29th 2013, 12:00AM 1 Comment

by The Landlord

That’s the message from Auckland Property Investors Association president David Whitburn after the department launched a campaign to turn around negative perceptions of HNZ leases.

Whitburn said he had been approached by HNZ, who wanted him to tell the association's members that more housing stock was required.

There are 10,000 people on the waiting list for a HNZ home and the situation is made worse by the soaring Auckland property market, which makes it more expensive for the Government to purchase properties.

“They’re not developers themselves, they don’t do big renovations but rely on developers," Whitburn said.

But he said HNZ had developed a reputation for haggling over repairs and maintenance of leased properties, and stretching the definition of reasonable wear and tear. “By and large their tenants provide more wear and tear than your run-of-the-mill tenants.”

HNZ has launched a publicity campaign and new lease agreement, which is designed to give landlords more protection.

But Whitburn said there was still a perception among investors that HNZ paid up to 10% less than market rent for properties. With a 10% management fee on top of that, it was quite expensive.

He said the guaranteed rent was not a big draw in Auckland, where there were few problems with vacancy rates. “If they paid a bit more, more people would use them.”

The new HNZ lease includes the option of a shorter term, starting at five years, rather than the 10 to 15 that is usually standard. It halso commits HNZ to doing any and all repairs up to $5000.

An independent inspection report will be sent to landlords every year and rents will rise with inflation.

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