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New Zealand - Property Letting

If you own a property in New Zealand that you no longer need to live in, or you have bought solely as an investment, then letting it out to tenants is one way of ensuring the house does not stand empty for long periods, and can also help to boost your household income. All it takes to find tenants is a small amount of advertising and it is not essential to have a licence to rent out a property.

However, you should make sure you find the right tenants for your property and so any advertising you do must be worded correctly. For example, if your house is not animal or child friendly, then it must state on the advertisement that pets and children are not allowed. If you do not want smokers inside the property, this should also be made clear in the first instance. This will ensure you are not wasting your time or the time of potential tenants prior to the start of the lease.

Assessing the rental fees can be difficult. Landlords often judge what rent they ask for by fees on similar properties in the area, but there are other factors to consider, such as the condition of the property, the facilities and amenities available, and what exactly is included in the rental charge, for example rates, water charges or monthly maintenance fees, for example gardeners.

New Zealand has the Residential Tenancies Act that must also be adhered to by anyone wishing to rent out their property. The Act states that landlords must follow certain rules such as allowing tenants to live in quiet enjoyment at the property, meaning that the landlord cannot harass the tenant, interfere with their privacy and comfort and not allow others to do so either. The property must meet certain building regulations and health and safety standards prior to being let out. The landlord must keep the property well maintained throughout the tenancy and prove receipts for rent paid to them. They must also give written notice of any rent increases. If the landlord decides to sell the property while there is still a tenant living there then the tenant must be informed of this in writing.

There are also several things a landlord must not do, such as interfere with utility supplies, such as water, electric, gas or telephone. The landlord must also never seize the tenant’s possessions for any reason. In New Zealand a landlord is only allowed to enter the occupied property with consent of the tenant or if there is a lawful reason to do so. The landlord must never change the locks without the tenants consent and is not allowed to unreasonably deny the tenant to attach fixtures inside the property.

There may come a time when a tenant during their lease has to leave the property for a short while. Under the Residential Tenancies Act a landlord is not allowed to withhold permission for that tenant to sublet the property, or to reassign the property to another tenant for the duration of the tenancy agreement, only if the tenancy agreement has no clause against doing so. Some landlords may include in their tenancy agreements certain conditions for sublet or tenancy reassignment.

In order to end the tenancy agreement the landlord will need to put this in writing. If possible there should be at least 90 days’ notice, but if for some reason the tenancy needs to end sooner than expected then a valid reason must be given. The notice must be signed by the landlord. The notice can be sent in many ways, through the post, via email and even fax. It is also acceptable to hand deliver the notice to the tenant. The landlord must also allow time for the tenant to receive the notice if sent any other way rather than being hand delivered directly to the tenant. Notice does not commence until the day AFTER the recognised day of being served. This means that if the notice is being delivered by post then there will be several days delay on the notice commencing to allow time for the post to be delivered and then to be picked up and read by the tenant.

If it is the tenant giving notice to leave the property then there must be at least 21 days written notice period. It may be agreed between the tenant and landlord that a different notice period is given but again this must be done in writing.

Many people who choose to rent out their property will do so through an agent, but this is not essential. Many local estate agents will also act as letting agents or some towns have dedicated letting agents.

Useful Resources

Auckland Property Investors Association

Real Estate Institute of New Zealand

Read more about this country

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