Letting fee change good, other legislation not so good

A landlord who comments here (David) reports on the effects of the ban on charging tenants a letting fee…

There has been some comment about the end of letting fees, which I support, and as I predicted my property manager informed everyone that there is now a fee to commence a new tenancy for the landlord and its approximately half what a normal weeks rent is.

Its tough enough for a tenant to come up with a bond and rent in advance and then have to pay a fee on top of that.

Well done Labour.

But other changes are not so well received.

Other parts of its proposed legislation are not sensible, forcing landlords to accommodate pets, allowing tenants to do minor renovations, allowing tenants to just cancel leases are not well thought through.

Pets can make a real mess of properties.

Allowing tenants to do renovations seems a very odd change.

Longer leases would be really welcome but they only work if both sides are obligated otherwise they are ridiculous, I would love to sign 10 year leases and allow annual inspections instead of the insurance company mandated quarterly and develop longer term relationships with my tenants.

I understand why some landlords would like long term leases (with good tenants).

But that wouldn’t work for student flats. Twelve month leases are common in Dunedin due to the student population.

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7 Comments

  1. Gezza

     /  November 6, 2018

    There has been some comment about the end of letting fees, which I support, and as I predicted my property manager informed everyone that there is now a fee to commence a new tenancy for the landlord and its approximately half what a normal weeks rent is.

    If the tenant is charged this – what’s the difference (in practice) between this “tenancy commencement fee” and a letting fee?

    Reply
    • David

       /  November 6, 2018

      Landlord is charged, perhaps I should have said the charge to commence a tenancy, or letting fee but the same thing.

      Reply
  2. NOEL

     /  November 6, 2018

    “Allowing tenants to do renovations seems a very odd change.”

    Maybe.
    Sorry tenant I have to renovate so I’m giving 90 days. (Actually I’m going to do some cosmetic changes and increase the rent with the shortage of rental properties.)
    Hold it I can do those renovations you just provide the msterials.

    Reply
    • David

       /  November 6, 2018

      If you have 500k invested in an asset the last thing you need is some tenant going off half cocked and doing some dodgy renovation they are ill qualified to do then leave 3 months later leaving the landlord to pay to fix it, not to mention the health and safety aspect. Have allowed a couple of tenants to do minor things with consultation if they seem to know what they are doing and provided materials.
      2nd scenario is rare but if you improve a property the tenant may be happy to pay a little extra for that if not they can chose to move somewhere else. We had a some pretty dispicable behaviour from some landlords during the aftermath of the quake, a minority can give all a bad and undeserved reputation.

      Reply
  3. -D

     /  November 6, 2018

    It may be “tough” for a tenant to come up with bond and rent in advance but in the landlord’s defense the relationship is by nature asymmetrical in the tenant’s favor. If the tenant subsequently runs into financial trouble, or signed the lease without proper experience or forethought, or has second thoughts later, or is a deadbeat, or for whatever reason stops paying rent, the landlord is saddled with hassle and lost income until the property can be freed up for re-rental. This recent change just means that the landlord also loses the advance rental fee.

    Reply
    • David

       /  November 6, 2018

      Landlords still charge a bond and a couple of weeks in advance its only the letting fee that goes and that went to the property manager as a general rule.
      One piece of advice always use a good property manager.

      Reply
  4. Kitty Catkin

     /  November 6, 2018

    I see no reason for a law allowing pets. Marama Davison’s twaddle about how it makes a place feel like a home is sentimentalism. She has never had to clean a flat where the tenants had allowed the pet to do its business inside and stained the carpet, or tried to get the stink out.

    Reply

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