Landlords and tenants take note….!
Important changes have been made to the laws which apply to rental accommodation. The Government has made changes to the Residential Tenancies Act, which are being implemented in three phases. Phase 1 took effect in August 2020 and changed the frequency of permitted rent increases to once every 12 months from the previous minimum 180 day interval.
Phase 2 will take effect from 11 Feb 2021. Significant changes include:
- Landlords will now need to provide a reason for ending a periodic tenancy with 90 days’ notice. New termination grounds will be available to landlords, and the required notice periods will change.
- Landlords need to prove three separate anti-social behaviour occasions within a 90 days period before they can evict a tenant for that reason.
- Landlords must give 63 days’ notice instead of the previous 42 days if they wish to move themselves, their family, or employees into the property, and the reason must be genuine and proved to be so if challenged.
- Similarly, landlords must give 90 days’ notice of termination to remove tenants if the landlord wishes to sell the property, or renovate or demolish the residence.
- Tenants must now give 28 days’ notice instead of 21 to end a periodic tenancy.
- Landlords may apply to the Tenancy Tribunal to end a periodic tenancy if the rent is late by five working days on three separate occasions within a 90 day period.
- All fixed-term tenancies will convert to periodic tenancies at the end of the fixed term unless the parties agree otherwise, the tenant gives the 28 days’ notice, or the landlord gives notice according to the termination grounds.
- Rental properties must be advertised with a price. Rental bidding is prohibited.
- Tenants can make minor changes to the property. Landlords must respond to a tenant’s request to make changes within 21 days and must not decline the request if the change is minor. What qualifies as “minor” remains to be seen and this is an area we can see as being potentially fraught as landlords may not want changes to décor for instance.
- Tenants can request to install fibre broadband, and landlords must agree if it can be installed at no cost to the landlord unless specific exemptions apply.
- Tenants can assign tenancies, and landlords cannot decline unreasonably. This rule cannot be contracted out of.
- The Tenancy Tribunal can now hear cases and make awards up to $100,000 instead of $50,000.
Phase 3 of the changes takes effect on 11 August 2021 or earlier if the Government decides. The changes in Phase 3 relate to family violence or assault. In short:
- Tenants experiencing family violence can terminate a tenancy without financial penalty.
- A landlord will be able to issue a 14 days’ notice to terminate the tenancy if the tenant has assaulted the landlord, the owner, a member of their family, or the landlord’s agent, and the Police have laid a charge against the tenant.
The changes may well create some uncertainties for landlords. It is crucial for landlords to understand the new law to avoid breaching their legal obligations and for tenants to know their new rights. If you would like further advice or information regarding these changes, please don’t hesitate to contact one of our team at Harmans Lawyers for advice.