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The problem of “horror tenants” is dwarfed by that of horror houses

by Elinor Chisholm

Yesterday's Herald piece, "Horror tenants frustrate landlord", was its most popular throughout the day. The article is about "horror tenants", or, as this landlord describes them, "pigs". The "renters as pigs" genre is clearly a popular one, and includes TV shows such as Renters, which warns the viewer against even living next door to one of these "dirty, dim and despicable" creatures.

It's odd that a third of the population get such a bad rap. It's particularly odd when “horror tenants” are not that much of a problem, in the scheme of things. According to the article, only a small proportion (0.6%*) of tenancies wind up in damage disputes in the Tenancy Tribunal per year, and one supposes that the proportion that finds the tenant at fault is smaller. In any case, that's why we have such a court: to settle disputes.

Although this case is clearly on the extreme end of things, it too has been dealt with by the Tribunal. Presumably the landlord was not content with the court's judgment, and sought media attention. However, the Herald is wrong to say the landlord is "chasing rent". The Tribunal has ordered compensation. Whether compensation is swift enough, or whether the case was dealt with quickly enough is another issue altogether; it's about the justice system and its potential reform rather than "horror tenants".

It's wrong when tenants maliciously damage the houses they rent. But as with any investment, it’s sensible for property buyers to look at both the potential risks as well as the likely benefits of buying any one property. Property damage, falling values, and the chance an employer will leave town are some of the risks of buying rental properties. Tax-free capital gain, and the speed with which property values rise in New Zealand, are some of the gains. Presumably this landlord decided that this investment was worth their while.

The Herald asks readers to send in photos of the damage wrought by their own problem tenants. There's no similar call for photos of damage wrought by landlords' neglect of their rental properties (most landlords don't budget for maintenance). But if there were, we might not see many people submit their stories, for the same reason that it's far less common for a tenant to take a landlord to the Tenancy Tribunal - even though we know that, according to BRANZ, 44% of rental homes are in poor condition (twice the amount of owner-occupied homes). This has massive and well-documented detrimental effects on health.

We hear less about horror houses because of the lack of options available to renters. Complaining about, say, housing conditions, to the media or to the courts, may damage the tenant-landlord relationship, and the tenant might get their notice, despite the illegality of 'retaliatory evictions', as Dr Sarah Bierre has written. There's a disincentive to complain when you risk losing your home - moving is financially and emotionally taxing. Added to that, having a reputation as a tenant that complains won't do you any favours when you search for a new home. The article, in fact, recommends that landlords check the references of potential tenants; it's probably that a positive reference is unlikely to come from a landlord who you took to the Tenancy Tribunal for not fixing the leaky roof.

"Horror renters" are a very small issue, about 0.6% of the population, that, fortunately, we deal with through the courts. Horror rental houses, on the other hand, is a huge issue – 44% of our rental homes. Our current system, with its lack of quality standards, and with its disincentives to tenants for taking issues of quality to the court, is not working. Bring on the WOF.


* I think it is it something like 0.6%, at least based on the figures provided. 32% of 1.5 million houses rented makes 480,000 tenancies. 45,000 of those per year wind up in the Tribunal  An article this morning says that 6% of claims from July 2013 to May 2014 were about damage; 6% of 45,000 is 2,700. 2,700 cases of damage from 480,000 rented houses – that’s 0.6%. There must be repeated cases, however, so this figure is just a best guess. 

Elinor Chisholm (@ElinorChisholm) blogs about housing issues at www.onetwothreehome.org.nz

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