Tenancy debt level to improve

Landlords lose five weeks of rent per year on average - but those losses are set to decline, a tenancy debt specialist has said.

Thursday, February 18th 2016, 8:01PM

by The Landlord

New data from Tenancy Practice Services shows that nationwide, on average, landlords lose nearly $1800 in tenancy disputes, which works out to be five weeks of rent.

While this might seem steep, it is an improvement on several years ago.

In July 2012, an NZ Property Investors Federation survey showed that, at the time, members on average lost $2042 in tenancy disputes, over and above any bond received.

However, changes contained in the Residential Tenancies Amendment Bill, which is currently making its way through Parliament, mean that landlord losses should decrease further.

The legislation establishes a new 10-day process which is intended to enable faster re-tenanting of properties when a tenant abandons a property with no intention of returning.

Building and Housing Minister Nick Smith has said this is important because the current process can take up to six weeks, leaving a house empty and the landlord out of pocket.

The new process is expected to take around four weeks.

Tenants Protection Association manager Helen Gatonyi said that there could be delays in processing Tribunal applications.

“That is being addressed in the amendments to the RTA in terms of the 10-day abandonment so that is really a good step."

The Tenancy Practice Services data also shows that Northland and West Coast landlords suffer the most, with over six weeks of rental debt owed to them.

Waikato landlords were New Zealand’s best off landlords, losing just over four weeks of rent.

Auckland landlords lose an average of 5.6 weeks rent, Wellington landlords lose 5.89 weeks rent and Canterbury landlords lose 4.86 weeks rent.

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