Housing

Two Sides: Should New Zealand implement rent controls, yay or nay?

We like to look at issues from different angles - today, rent controls. 

The Prime Minister’s ruled them out, but with inflation on the rise and rents sucking up the lion’s share of so many people’s precious weekly kitty, there are growing calls for her to take another look.

The President of Renters United Geordie Rogers told Tova O'Brien they are suggesting a cap is put on the amount rent can be increased for existing tenancies.

He explained there are circumstances where rent can be increased above a fixed percentage, and those cases are where a meaningful improvement has been made to the property.

"It's shifting that balance and saying if you want to charge more rent, you have to make the tenant's life better otherwise what are you charging extra rent for, other than filling your own pockets?" Rogers said.

Renters United is working to make sure tenants are not being abused and taken advantage of in the renting market.

Rogers told Tova most landlords and most rental properties are existing builds and aren't contributing to supply.

"There does need to be incentives on the supply side but at the same time, we can't forget these people are renting. A very large percentage of their income is going towards landlords and it is one of the biggest shifts in wealth in New Zealand."

He referenced Luxembourg, Sweden and Netherlands as countries that have rent control processes in place similar to what Renters United are aiming to achieve in New Zealand.

On the other side of the argument is the President of the Property Investors Federation Andrew King who acknowledged rent is expensive in NZ but put it down to the fact that housing is expensive and the three increases in tax to provide rental property in Aotearoa.

"The problem in the last year is we have had three tax increases and that has made it more expensive to provide rental housing to tenants," King said.

"If we get rid of those tax increases, that will be the best thing for tenants, it will make it cheaper to provide rental properties and we won't have to see rental prices increasing."

He told Tova the Property Investors Federation has a five-point plan for solving the rental crisis NZ is in and a big part of it is to get rid of those taxes and make rent cheaper for tenants.

King noted there are already restrictions and rent controls on landlords and adding further limits and problems won't help the situation.

"Legally, you are not allowed to charge more than market rent, new laws have come out so that we can only put up rents once a year, rent bidding has been outlawed so there are limits on what we can do with our rent."

Listen to both sides of the argument between the President of Renters United Geordie Rogers and the President of the Property Investors Federation Andrew King, with Tova, above.

You can also download the full interview on the Tova podcast, and listen on the go. Check it out on the rova app or wherever you get your podcasts.