Temperatures are running high after a residential property investors federation with only 4000 members put forward -proposals to send all New Zealand's 180,000 landlords back to school.
The New Zealand Property Investors Federation, which has 15 associations around the country, put forward the idea for all landlords to sit, competence exams as part of a move to head off 'warrant of fitness' checks on renters and registration of every landlord.
Anyone who failed would be sent on a course. Until they passed, they would have to surrender the management of properties they rented to professionals.
The federation also raised the idea of a fee and registration of each new tenancy to pay for the exam system.
Federation president Craig Paddon said many members were angry at the proposals and hurt because they were publicised after having been discussed by only a small federation think tank.
He also agreed that the estimated 176,000 non-member landlords would not see the federation's move as representing their interests.
But Geoff Boxall president of the rival `Wellington Property Investors Association, landlords who did not join such organisations were voting not to have their voices heard.
To soothe infuriated federation members, Paddon is planning a nationwide series of meetings – a proposal the federation’s executive was to vote on this weekend.
The anger of many federation landlords was evident the Auckland branch of the federation met last Tuesday.
They thought landlording standards were high but believed there was a political agenda working against them.
But Auckland association president Andrew King said the message from the government was clear: come up with self-regulation to improve landlords' professionalism, or, it will be imposed with potentially draconian effect.
King said the $50 registration fee was getting dangerously close to registration of rental properties and licensing of landlords.
But Helen Gatonyi of the Christchurch Tenants Association said this was something her group wanted, with 'warrants of fitness' issued by local councils.
King said the cost of such a scheme would be high. One landlord said a huge bureaucracy would emerge if $50 were charged for each new tenancy.
Such a charge would raise about $15 million a year, as about 300,000 new tenancy agreements were made annually.
But Paddon denied such a cash-raising exercise was planned, though he looked with envy at the Real Estate Institute's annual budget of $8m, compared to the federation's $100,000.
The $50 figure quoted was purely hypothetical, he said, and not based on any figure proposed by the federation.
He also warned penny-pinching landlords 'with gorse in their pockets' to wake up to the fact that regulation of the multi-million dollar industry was coming.
While landlords lodged over 80% of all claims heard by the tenancy tribunals, half of all calls to Tenancy Services were from disgruntled tenants.
Paddon said that reflected landlords' poor knowledge of the law, poor record of maintenance and failure to recognise they were providing a home as well as a service.
He estimated that only one in 10 landlords knew the law that governed their industry.
I have been inundated with emails, and I can tell the ones the that are really irate about the concept of paying another fee or being regulated are individuals like that,' he said of those opposed to the plan.
The drive towards self-regulation came out of federation lobbying for the ongoing review of the Residential Tenancies Act, which landlords believed allowed tenants to get away with murder'.
Landlords wanted wilful damage to property criminalised penalties imposed on rent absconders and the system for tracking down rent-runners beefed up.
A tenant who did a runner and was later caught simply had to pay back the missed rent, but was not ordered to pay penalties or costs.
King said that was pure and simple theft and should be treated as such.
He and other landlords believed the system encouraged tenants not to pay rent.
The federation had other grouses as well.
It believed tenants should face penalties if they refused to pay their last two weeks' rent, expecting the bond to go to the landlord.
'The bond is our insurance against vandalism and damage,' King said.
Landlords also wanted to remove the duty to look after abandoned goods, and the $20 fee they had to pay to apply to dispose of them.
They also wanted to be able to provide financial incentives for good tenants - something the law forbids.
But Gatonyi said the Residential Tenancies Act and Tenancy Services were working well and did not need fixing.
Ignorant landlords needed to be forced to improve their knowledge, and organisations like hers would fight the 'criminalising' of tenants all the way.
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