Housing Minister Phil Twyford’s reforms likely to raise rents, officials warn

Housing Minister Phil Twyford’s package of tenancy law reforms would likely drive up rents by causing some landlords to get out of the market, officials have told him.

Officials said while most of the tenancy law overhaul and other changes to the rental market considered by the Government would not have much of an effect on their own, their cumulative weight could lead some landlords to sell their properties to owner-occupiers.

Because owner-occupiers typically have less people in a house than renters, this could lead to a further shortage in rental properties – and higher rents.

The advice came in a late-April paper produced for Twyford by the Ministry of Business Innovation and Employment (MBIE) and obtained by Stuff under the Official Information Act.

The policies discussed include the Healthy Homes Guarantees Act, which sets more strict standards for rental properties, the extension of the Bright Line Test taxation change, and the expected end of “loss ring fencing” for landlords, a setting that allowed landlords to offset losses on one property against another.

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Source: Stuff NZ