• Scrapping of ‘no cause’ terminations will create new blacklist of tenants, says real estate boss

    A real estate boss is warning that a proposal to scrap ‘no cause’ tenancy terminations will force landlords to utilise other provisions of the Act to evict tenants – making it more difficult for some tenants to find a new rental when they move on.

    The proposal to end ‘no cause’ terminations is one of a suite of measures being proposed by the Government in an effort to ‘modernise’ the Residential Tenancies Act.

    According to Housing Minister Phil Twyford, “a small minority of landlords (are) giving the whole sector a bad name (and) rental law reform is needed”.

    Under the proposal, which has been put out for consultation, Landlords would no longer be able to evict tenants, without reason, after 90 days. Instead, evictions will need to comply with defined ‘causes’ – a provision which was in the previous Act but for which the eviction period has been increased from 42 to 90 days.

    First National Real Estate Chief Executive Bob Brereton says that this change will have significant unintended consequences because landlords will now be forced to use provisions which could make it difficult for tenants to find another property to rent.

    “Currently, it’s often easier for a Landlord or Property Manager to issue a 90 day notice than to take a tenant through the Tenancy Tribunal and get an order for eviction,” Brereton said.

    “For example, in cases where a tenant is behind on rent, causing complaints from neighbours, exceeding the number of people allowed to occupy the home, or just generally making life difficult for the Landlord or property manager it’s often easier to just issue a 90 day notice – even though there might be sufficient evidence to take the tenant to the tribunal”.

    However, if the 90 day clause is removed, Landlords and Property managers will be forced to provide details of these breaches in order to obtain an eviction notice – which means a ‘black mark’ will be registered, against that tenant, on the Tenancy database making it much more difficult for those tenants to secure a new property”.

    Mr Brereton says that the Government seems to be under the impression that the 90 day clause is being abused by landlords to get rid of tenants and that it disadvantages tenants by not giving them security in their home.

    “This is nonsense. The reality is that the 90 notice is often used to protect the tenant from a stigma which would stay with them in future rental situations”.

    Tenancy.co.nz consultant Scotney Williams argues that the ‘no cause’ termination is often used for tenants who push the boundaries of what is considered acceptable behaviour.

    “If the government was to change (the ability to issue 90-day no cause terminations) it would certainly make it more difficult to manage tenants who were doing things which are just below the case of obvious (breaches) and in which case evidence is difficult to get,” Williams said.