With rising insurance and council rates, New Zealand landlords may have to increase their rents to get a decent return on their investment.
If you’re the landlord, can you increase the rent whenever you want? Well not exactly.
The Residential Tenancies Act 1986 and amendments governs the rights and responsibility of New Zealand landlords and tenants.
Landlords in NZ can’t increase the rent within the first 180 days of a new tenancy agreement. So if you just signed up a new tenant on the 1st of March, you cannot increase the rent between 1st of March and 27 August.
Once 180 days have passed, here are the procedures you must follow to increase the rent:
1. You must give the tenant notice in writing that you will increase the rent. If you need help drafting or writing a rental increase notice, email me firstname.lastname@example.org and I can provide you with a template.
2. The notice must say what the new rental is and from which day the new rental will apply
3. You have to give at least 60 days’ notice. This means if you gave notice to the tenant today that you will increase the weekly rent from $450 to $500, the earliest it can take effect is 60 days from now.
But, here’s where landlords need to be careful:
Your tenants can apply to the Tenancy Tribunal if they believe that rent is substantially above the market rent. For this reason, it’s always best to get a rental appraisal for your property before increasing rents. This makes it easier to justify a rental increase and more likely the tenant will accept the rental increase.
Remember, If you need help drafting or writing a rental increase notice, email us email@example.com and I can provide you with a template.