Queenstown Landlord Guide: Avoid Accidentally Breaking the Law

With a rental housing shortage in Queenstown most local landlords are genuinely doing their best to manage their rental properties, but you may be finding yourself stretched. The Queenstown Lakes District is pressed for both short and long-term rental accommodation. And as a result of the ever-changing tenancy law, inexperience, or unfamiliarity with law changes, landlords can find themselves making mistakes and taking actions that could be considered illegal. In order to avoid accidentally breaking the law, it’s important to know your obligations.

To make it easy, we’ve broken down a few of the most common mistakes made by landlords to help you steer clear of them. Understanding your responsibilities will help you to keep good tenants, avoid taking unintentional illegal actions, and stay on the right side of your tenants and the law.

Entering the property without giving proper notice

Landlords often enter the property to address a maintenance issue or conduct an inspection. However if sufficient notice is not given and the tenant’s permission is not obtained, then entering the home is illegal. The amount of notice required varies depending on the situation but some general guidelines are laid out below.

How to avoid this:

Give 24-hours notice before entering the property for repairs or to provide access to maintenance workers.
Only conduct these repairs between the hours of 8am and 7pm.
Permission is not required in an emergency (eg. major flooding or gas concern), with a tenancy tribunal order, or to do the lawns if this responsibility is set out in the tenancy agreement.

Asking for professional carpet cleaning

Even if a landlord has customised a tenancy agreement requiring the tenant to professionally clean the carpets upon moving out, and both parties have signed, this stipulation may contradict the Residencial Tenancies Act. Any added terms that contradict the Act are legally unenforceable.

As a landlord you can expect the tenant to leave the house in a reasonably clean and tidy condition, but you may not force them to do more than required.

How to avoid this:

Ensure any added clauses do not contradict the Residential Tenancies Act.
Common conditions you may add to the tenancy agreement include no smoking, designating number of persons allowed, and outlining number and type of pets.

Denying a tenancy to people without jobs or with children

While a landlord may seek tenants who are reliable, able to provide references, and able to pay rent, they must be extremely careful of making any assumptions or basing decisions on stereotypes or past experiences. These decisions could be seen as discrimination, and the landlord could find themselves under scrutiny from the Human Rights Commission.

How to avoid this:

Screen tenants focusing on actual qualities such as references, reliability and ability to pay rent. Avoid assumptions!
Landlords do have the right to refuse tenancy to smokers or pet-owners.

Charging a “pet bond”

A bond may be no more than four weeks’ rent. Charging more than this in New Zealand for any reason is illegal.

Too busy or no funds for repairs

As a landlord, you are responsible for keeping your rental property in a habitable condition. Ignoring tenant repair requests or refusing to make repairs is illegal. If the matter is urgent, the tenant may have the repair done and request reimbursement from you.

How to avoid this:

Keep on top of maintenance requests
Respond to tenant requests in a timely fashion
Budget for maintenance and repair work

Failing to accurately account for rental income and expenses

Landlords have a lot of accounting to do, and if you are doing it yourself, it is easy to trip up over which expenses you can and can’t claim. Figuring out what is and isn’t a tax deductible expense can be tricky, and many landlords make the mistake of claiming expenses that are not tax deductible and missing out on some that are. For example, some expenses you may claim include maintenance, repair, and gardening costs while the property is tenanted, however if the property has not yet been tenanted for the first time, you may not claim similar costs for bringing a dilapidated property up to habitable condition.

How to avoid this:

Familiarise yourself with what you can and can’t claim.
Get in touch if you need help! At McClean & Co, we’re experts in what you can and can’t claim. We’d love to help you find the best way to manage accounting for your property investments.