Rental housing

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The rental housing problem

Most New Zealand housing has been shown to be cold and damp.  Rental housing, which form 33% of New Zealand houses, is generally in the poorest state.

Poor quality stock results in poor housing outcomes that affect health, wellbeing, education, welfare and employment outcomes for tenants.  The relationship between poor housing quality and New Zealand’s appalling child poverty situation are widely acknowledged.

Tenants of rental housing often have lower incomes and are often most vulnerable members of society: central and local government provide social housing along with a small third sector (Community Housing Organisations, CHO) and many households receiving government support via the Accommodation Supplement are housed in the private sector.

The rental conditions in New Zealand are restrictive when compared internationally: we have shorter lease terms; tenants can be given notice in 30 days on almost any condition; and tenants have low ability to make minor alterations to the home.

An increasing proportion of New Zealanders are unable to afford their housing costs.

The majority of rental homes are privately owned and are small investors.  Their key focus is capital gain; there are very few landlords who consider this their profession

There is a shortage of housing in parts of New Zealand (most notably Auckland and Christchurch); therefore, the rental sector is also short on supply in these areas.

Evidence about the state of rental housing, and impacts on tenants and landlords is incomplete and scattered: this undermines the ability of government to make good evidence based policy.

Institutionally, the rental housing sector is complex: no single central government agency is responsible for housing quality; formal rules governing rental housing are spread across different pieces of legislation; responsibility for rental housing is shared across more than one Minister; and, roles are played by several agencies within central and local government.


Improving rental housing

Currently there is interest in central government in a rental Warrant of Fitness and active debate on the pros and cons of a WOF. A number of interventions have been launched in recent years:

  • Five councils (Auckland, Tauranga, Wellington, Christchurch and Dunedin) have trialled a Warrant of Fitness developed by University of Otago, Wellington.  Of the 144 houses assessed, only 6% passed.  
  • In 2014 HNZ trialled a Warrant of Fitness scheme designed to ensure all houses are meeting a minimum health and safety standard.
  • A new programme certifies Home Performance Advisors to provide independent advice to homeowners, landlords and tenants to move towards a warmer, drier, healthier and more energy efficient home.
  • Rate My Flat is a new enterprise started by Otago University graduates to support the upgrade of Dunedin student rental accommodation.  
  • HomestarTM is New Zealand’s only residential rating tool, and while not just for rental housing, it is a housing intervention that could help landlords and tenants share information about housing quality.


Performance of rental housing fact bank

Beacon has brought together a repository of core facts and knowledge about the performance of rental housing and the issues around how this can be improved.  This is a living document; readers are encouraged to send updates or corrections to inform any reissue in the future. 

The document covers:

  • sources of evidence for the quality of rental housing stock
  • the impact of poor quality rental housing on tenants
  • supply and demand in the rental housing market
  • current interventions
  • characteristics of landlords and tenants
  • the policy and legislative context.  
  • rental housing market segmentation
  • Beacon’s recommendations to improve rental housing.

  • 26-Nov-2014 (Publication PUB/24)

    Beacon Recommendations: Performance of Rental Housing Resource v3 (PDF 200KB)

    Vicki Cowan, Lisa Burrough, Lois Easton

    Alongside assembling existing knowlege and understanding of the rental housing market and rental house performance in New Zealand, Beacon has made recommendations on improving the performance of rental housing.  These are the recommendations from the Performance of Rental Housing Resource.


  • 26-Nov-2014 (Publication PUB/24)

    Executive Summary: Performance of Rental Housing Resource v3 (PDF 205KB)

    Vicki Cowan, Lisa Burrough, Lois Easton

    This is the executive summary from the Performance of Rental Housing Resource.  The resource is Beacon's repository of core facts and knowledge about the performance of rental housing and the issues around how this can be improved.  It covers sources of evidence for the quality of rental housing stock, the impact of poor quality rental housing on tenants, supply and demand in the rental housing market, current interventions, characteristics of landlords and tenants, and the policy and legislative context.  The discussion segments the rental housing market and makes recommendations to improve rental housing.


  • 25-Nov-2014 (Publication PUB/24)

    Beacon Resource: Performance of Rental Housing v3 (PDF 1MB)

    Vicki Cowan, Lisa Burrough, Lois Easton

    This document is Beacon's repository of core facts and knowledge about the performance of rental housing and the issues around how this can be improved.  It is a living document; readers are encouraged to send updates or corrections to inform any reissue in the future.  The document covers sources of evidence for the quality of rental housing stock, the impact of poor quality rental housing on tenants, supply and demand in the rental housing market, current interventions, characteristics of landlords and tenants, and the policy and legislative context.  The discussion segments the rental housing market and makes recommendations to improve rental housing.


  • 01-Aug-2014 (Report TURANGA/1)

    Pacifica Housing: A Review of Existing Research (PDF 201KB)

    Camrian Berry

    Housing poses many challenges for Pacific families and communities. Housing-related issues include high rental costs, low-quality of rental properties and low rates of home ownership. This literature review cites several studies which illustrate the struggles faced by Pacific communities in home ownership and rental accommodation. Studies explore the links between housing and health, housing aspirations and the role of cultural identity in housing.


  • 05-Jan-2008 (Report EN6570/6)

    Appendix C: Landlords Energy Survey (PDF 400 KB)

    Kay Saville Smith

    A telephone survey of 491 landlords found resistance to investment in retrofitting and unresponsiveness to tenant demands or advice from professional bodies. Landlords report that they would renovate with financial assistance. Renovation and maintenance is largely cheap and basic redecorating, although in responding to cold, damp and mould, many pursue technological solutions before dealing with basic issues.  Appendix to House Owners and Energy - Retrofit, Renovation and Getting House Performance.

Performance of Rental Housing v3


This is a living document and we seek your feedback

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Rental housing - UK and NZ parallels

Energy Cultures’  Aimee Ambrose recently blogged about the difficulties in addressing poor quality rental properties in the UK.

It raised interesting parallels with New Zealand, although the UK is further along in trying to mandate higher standards of rental houses.

Aimee says the consequences of [poor] conditions for residents are well documented, there is a clear picture of tenants enduring dangerously cold homes that are unaffordable to heat., and the sector houses more vulnerable individuals than any other housing sector.  The same can be said for New Zealand and has been comprehensively addressed in our recent Performance of Rental Housing Resource.

Aimee discusses the lack of progress in driving up energy efficiency in the private rental sector. This is echoed in a blog by progressive website Left Foot Forward which says the private rental sector is the place to start. “The private rented sector has the worst energy efficiency levels of all housing types and the highest percentage of households in fuel poverty.“