19 Jan 2021

Rental market supercharged as university year looms

From Summer Times 2021/2022, 9:15 am on 19 January 2021

A one-bedroom dwelling made from a shipping container and garden shed in Wellington has been listed to rent, for $390. 

The room in Johnsonville is said to be suitable for one person, and close to the mall and local schools. 

It comes as students in Wellington call for better living support as an over-inflated rental market forces them out of the city centre.

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Photo: Sourced from Trademe

Geordie Rogers from Renters United told Summer Times it is an unfortunate fact that such properties frequently come on to the market.

“We do see properties like this being listed all of the time, it wasn’t that long ago that we saw a sunroom being rented out that only fit a queen bed in it, it didn’t fit any other furniture.

“I think it’s unfortunate that we see so many of these and one of my gut feelings is that there is more than we get to see, because there is so much strain on the market people are just whipping up these properties and tenants are willing to take them because there is nowhere else to go.

"I really wish there was some data to tell us how many people are living in houses that I would not call a home."

This particular property, he says, has a bed, a microwave, and a plug-in stove.

“I think the worst thing about it for me was the entrance which was basically some wood that had been put up and covered with a tarp and then put a door in it. And that was the entrance to your home.”

He says he fears there are similar properties out there that are being rented.

“I am really scared that there are more properties out there that people are taking up and not complaining about.

“People are going to take somewhere to live whatever that looks like especially when there are not many other options.”

The rental crisis has been years in the making, he says.

“On one hand we don’t have enough supply, especially in Wellington to provide these houses.

“And on the other hand, there is no regulation to say specifically how good a house should be. The Residential Tenancies Act just says it needs to be in a reasonable state of repair and follow building codes. And there’s really nothing more than that with the exception of the Healthy Homes Standards which doesn’t go very far either.”

There are rules coming in to allow tenants to dispute a rental price, he says.

“Those rules are in the Residential Tenancies Act and with the new amendments coming in on 11 February it means that they can’t be unreasonably high when you look at other properties in the area.

“Tenancy Services has a tool that allows you to look at what the average rent is within the area you are looking at renting

“If you believe that the cost is too high you can submit a claim to the Tenancy Tribunal.”

However, these provisions are inadequate, Rogers says.

“While I understand that there is some positives there that you can try and get a rent reduction, for a lot of people who don’t understand the legislation, or perhaps don’t have the time or money available to go to the Tenancy Services to submit that claim and then argue it with the property manager, or the landlord, it doesn’t really do what it set out to do.

“In Germany, for example, if you want to increase rent you apply and say here’s the benefit I’ve provided I’ve done these things to improve the property or inflation has gone up so I believe I deserve this amount and it’s on the landlord to prove that they need to earn that much rent.

“I think that’s perfectly reasonable given that they are the ones being paid to be a landlord, so it should be their time and effort that goes into arguing for the rent price rather tenants who are usually money and time poor.”

Licensing of landlords and property managers is essential, he says.

“It is part of our plan to fix renting, it’s very easy for someone to buy a house, or in this case a shipping container, and rent it out. And this person has the keys to that building and they can come in there whenever they want.

“I know there’s legislation that says that they can’t, but it doesn’t stop people from physically entering a property. And in a lot of cases landlords will enter the properties and people will be too scared to go to the Tribunal because they don’t want to be evicted.

“I think in New Zealand there certainly is a place for regulating property managers, we do it with multiple other industries, we do it with real estate agents for example.”

The real estate industry supports such regulation, he says.

“They see a lot of these sorts of properties that they wouldn’t touch with a barge pole”