Residential Tenancies Amendment Bill Passes 2nd Reading

The Residential Tenancies Amendment Bill (the Bill) has passed its 2nd Reading in Parliament after being amended to include a few changes from the original Bill. The Bill will amend the Residential Tenancies Act 1986 (the Act). In addition to the increase in some of the fines for unlawful acts under the Act, there are several other substantial changes. The Regulations for smoke alarms and insulation have been finalised and can be accessed here.

The proposed changes include

  • Landlords to be given a specific right of entry to install smoke alarms and installation;

  • Tenants will be formally responsible for replacing batteries that are worn out

  • Tenants will be obliged to comply with the regulations about smoke alarms and insulation;

  • A prohibition in providing cash payments to tenants in exchange for them carrying out work orders relating to health and safety under any legislation;

  • The Tribunal will have new powers to order consequential orders as part of the original work order. Such an order could say that if the landlord has not made a repair by a certain date, then the tenant may arrange the repair themselves and deduct the cost from the rent;

  • In the above situation, the tenant will be allowed to pay their rent to the Chief Executive of MBIE instead of their landlord where it would be held in trust until enough money has accumulated to enable the tenant to pay for the work;

  • Amendments that come into force from 1 July 2016 specifying what installation should NOT be used to avoid Landlords installing unsatisfactory insulation before 1 July 2019;

  • Where Landlords have made all reasonable efforts to find out the details of the insulation in the property but are unable to do so without making invasive investigations, they are able to make a statement confirming this in new tenancy agreements;

  • The regulations will be entitled to set rules to prescribe that materials in addition to standard insulation may be required such as ground vapour barriers in properties that have issues with dampness;

  • The Tribunal’s records will be able to be stored electronically, and people will be able to apply for copies of records online;

  • Parties will be able to make applications to the Tenancy Tribunal online; and

  • An increase in the maximum amount a Landlord can be fined if:

  • They fail to comply with the regulations about smoke alarms or insulation (as well as any of the other requirements about health and safety, buildings, cleanliness or maintenance) from $3000 to $4000; and

  • They end a tenancy in retaliation to a tenant asking them to comply with their legal obligations from $2000 to $4000.

  • The changes to the Bill have not affected the following proposed amendments to the Act. As proposed, some of the changes the Bill will introduce include but are not limited to:

  • Requirements that all properties maintained by social housing providers under the Act will have to meet new insulation requirements by 1 July 2016, with remaining tenancies to follow by 1 July 2019. There will be exemptions where it is not practical to do so;

  • All residential rental properties will have to have smoke alarms installed from 1 July 2016;

  • A requirement that certain information must be included in all Tenancy Agreements signed after 1 July 2016, such as contact information and the insulation status of the property. The landlord will commit an unlawful act if this is not done or is false/misleading (fine up to $500);

  • Certain records (created after 1 July 2016) must be kept for 7 tax years after the tax year to which they relate (fine up to $200);

  • Certain documents (created after 1 July 2016) must be kept for 12 months after the termination of the tenancy, including the tenancy agreement, any reports of inspections of the property, or any notices or correspondence between the parties in relation to the tenancy;

  • New procedures to allow for a quicker resolution where there is a suspected abandonment of tenancy;

  • A power permitting persons authorised by the Chief Executive to enter and inspect premises in relation to alleged breaches. The Tribunal must authorise this inspection;

  • It will be an unlawful act if somebody breaches a work order imposed by the Tribunal without reasonable excuse; and

  • A power for the Chief Executive of MBIE to publish certain comments about people who have been landlords.

Click Here for Access to the Bill

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