Labour wants to make life even easier for renters

Labour just don’t get it. The more they make life easier for renters, the more landlords they drive out of the market.

Times are tough ?for renters. According to Labour. quote:

Housing Minister Phil Twyford and Green Party co-leader Marama Davidson released a discussion document on the issue this morning.

They will look at scrapping no-cause tenancy terminations, increasing the notice landlords have to give tenants if they are to end one, and limiting rent increases to once a year.

They are also looking at measures to end rent-bidding wars – a recent factor in New Zealand’s bigger cities.

Mr Twyford said this is a “generational reset of the way we rent in New Zealand”. end quote.

You are dreaming. The private rental market is a two-way street. It has to work for both landlords and tenants. Otherwise, like all markets, it falls apart. There are plenty of reasons why this particular market is falling to bits. quote:

“We want to make life better for renters, because at the moment it’s a miserable and pretty punishing existence for many renters. It’s got to be better than this,” he said. end quote.

Well, that is fine. As the private rental market gets tighter and tighter, there will be no problems. Those that can afford to pay for decent accommodation will pay their rents, play by the rules and have a relatively good experience.

But that will only be for the renters at the higher end of the scale. Those below that? (mostly those on lower incomes) are going to find life gets tougher and tougher. quote:

“We can look around the world at a number of other jurisdictions who take different approaches, but its not about picking a new system off the shelf, we’ve got to design something that works here and now for us in New Zealand.” End quote.

Yes, Phil and don’t take examples from countries that don’t have a housing crisis, will you? Or those that have a large pool of social houses, because we don’t have those either. quote:

Ms Davidson used her own experiences with a bad landlord to highlight the issues in the market.

“Right when I became an MP. I had a kitchen rotting out the back, drafts through the windows, uninsulated, garage door falling off. And I was evicted because of the investment market,” she said. “It was an on-sale to investors.”

Ms Davidson said she went from the back of a line of prospective renters to the front, as soon as she landed that MP salary.

“Previously I’d looked at 50, applied for 30. Had to beg for a property that no-one else wanted. Big change. And the privilege – you shouldn’t have to become an MP to be able to get a rental property.” end quote.

You don’t have to become an MP to be able to get a rental property. You just have to be a decent person who obeys the rules, looks after the property and pays the rent. Do all of that, and you generally will have no trouble. So I question Marama’s position. Perhaps it was the family of 6 children that was the issue? I think that would probably rule out most rental houses anyway. quote:

National’s housing spokesperson Judith Collins said this proposed reform of the Residential Tenancies Act was an uninformed and knee-jerk decision.

She said it would not solve any problems and will cause renters to pay even more.

“If Mr Twyford thinks government price controls will stop tenants paying more for rent, he’s being naive.

“By limiting rent increases to once a year, landlords will be forced to raise rents higher and sooner, meaning tenants will actually be paying the same or more in the long run,” she said. end quote.

Spot on. All this will do is to drive more landlords out of the private market, which has been happening already. It will not help tenants. quote:

“As usual Mr Twyford’s announcement has been made in a vacuum away from reality – he needs to start thinking about the impacts of his vague housing policies and stop loading the costs onto New Zealand families.” end quote.

In this article from?Stuff, it seems that Twyford wants tenants to have all the comforts of home, at the landlord’s expense. quote:

The reforms would also make it much easier for tenants to own pets, with landlords possibly required to give a reason why a pet is not allowed.

This would still let landlords ban possibly disruptive or damaging pets, but would give tenants more even footing if they wanted to argue their case. end quote.

Sorry, but all pets can be damaging; that cute little kitten that climbs up the curtains, the dog that runs from inside to outside constantly, bringing mud into the carpet… it is all fair game now that Twyford is in charge.

Which means there is little or nothing that landlords can do to protect the condition of their rental property. Once pets are allowed under all conditions, it is open slather.

It is obvious that this government needs to dramatically increase the number of state houses available, and soon. They have made a start with this, by bringing back onto the market houses that have been contaminated by methamphetamine, but there are nowhere near enough of those. We probably need several thousand more state houses, and we need them now. Because most of the tenants they talk about will never be able to rent in the private market the way things are going.

But those houses aren’t there, are they, Phil? They are years away. So what are your tenants going to do now? Because, as you drive more landlords out of the market, you drive more tenants out of houses. The only thing they can do to protect themselves is to buy a house for themselves. But there is a problem with that. To buy a Kiwibuild house, a family will need an income of at least $120,000 and a deposit of $120,000. Even if they can meet these criteria (which is unlikely) there has not been a single Kiwibuild house completed yet, and most of those are years away too. So what do they do in the meantime?

It makes no sense to kill the goose that continues to lay the golden egg for you, Phil. In the meantime, more and more people find themselves homeless, or under enormous stress, just because you don’t understand how markets work.

Some people will argue, as they always do, that landlords selling rental houses will make more houses available for first-time buyers, which is true but the buyers will be those at the top end of the renters market, who can meet bank criteria. This will do nothing to help tenants on low incomes.

Maybe there is more to all this. The government can’t be that stupid, surely? It must be obvious to their advisors that this is only going to make things worse for tenants, particularly those on low incomes.

The government has constantly painted the landlord as the bad guy, even though they provide an essential public service. So as landlords sell up and the homelessness problem gets worse, which it will – how will the government deal with that?

You know, the only solution that I can see on the horizon is a compulsory acquisition of houses by the government. A bit like what is going on in South Africa right now.

I know it seems far fetched, but as the government is deliberately creating a policy that will make things harder and harder in the rental market, what other conclusions can you draw?