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OPINIONSocietyOctober 2, 2020

Let me be clear: we are not urging landlords to delay installation of heating

Photo: Getty Images
Photo: Getty Images

If you read articles in the Spinoff and elsewhere you might imagine and thought that the Property Investors’ Federation are heartless landlords only thinking of themselves – let me offer you a different perspective, writes Andrew King.

In recent weeks I’ve had the misfortune of seeing my name in headlines suggesting that I have “urged” landlords not to install heating in rentals. This is incorrect, but has been repeated in two Spinoff articles drawing on the original report – the first by Hayden Donnell and the second, yesterday, by Michael Andrew. I’d like to set the record straight.

I had told a reporter about Property Investors’ Federation findings that many tenants don’t want heat pumps. I explained that we believe tenants should be thought of as customers and it was a good idea to involve them in the heating decision and to talk to them first. If they want a heat pump then you might as well install one sooner than later. If your tenant doesn’t want a heat pump then you could take this into consideration and not put one in until you have to. This, as best I can tell, led to the front page headline “Landords urged to delay heating”.

This does not reflect the kind of organisation we are. While we represent private rental property providers, we operate as an industry group who acknowledge that tenants are a critical part of the rental industry. To be clear, the NZPIF doesn’t urge people to not install heating in their rentals.

We have actually been recommending heat pumps in rentals to our members for around the last 10 years. Many members have installed them into their rentals and their tenants are very happy. However, a number of our members have reported that their tenants didn’t want a heat pump or when they were provided, they didn’t use them.

Not all tenants are the same, of course, but we were surprised about this and researched the situation more. We found that around 34,000 children are admitted to hospital every year with health problems from living in a cold damp home, which is terrible.

We met with the Otago Medical School and found out that for every dollar spent on energy efficient heaters or insulation, the government saves $5 in health costs. Interesting.

We decided that all rental properties should be insulated and supported the 2015 National Party plan for compulsory insulation in rentals, which was passed into law.

We continued our research and met with the previous children’s commissioner, Russell Wills, a paediatrician, to discuss the situation of the kids going to hospital.

From all this we realised that fuel poverty was a major part in these 34,000 children’s health problems. We developed the idea of providing these children’s families with electricity vouchers over the winter months to encourage them to use their heaters (you’re welcome Labour). It isn’t the total answer, and we think Labour’s Winter Energy Payment should be better targeted, but it is a help.

So, if you read the Spinoff articles and thought that I and the NZPIF are heartless landlords only thinking of themselves I hope this gives you a different perspective.

We deal with a wide variety of tenants who have a wide variety of issues and priorities. Heat pumps are wonderful, but they are an absolute luxury for many. They look to other ways to make sure their family’s needs are taken care of.

Hayden suggested that landlords could pay the $2,000 for a heat pump and not pass this cost onto the tenant. (Actually, government officials estimate the actual cost of the Healthy Homes law is around $8,000 per property and this doesn’t include upkeep costs.)

But, I would ask: why should landlords pay? Local authorities around the country are looking to put up their council house rents to cover the cost of the Healthy Homes standards and taxpayers are footing the bill for Kāinga Ora properties.

The government will save $5 in health spending for every $1 spent on insulation and heating, so is it appropriate for them to pay? Sounds like a good investment.

If a business faces increased costs, either the price goes up or they will soon be out of business. Employees expect pay increases if the cost of living goes up, so why are rental providers considered differently?

If you are a tenant who has been looking for a rental over the last year or two, you probably found the experience difficult. Some believe that this is because rental providers are making excessive profits, but this isn’t the case. It is actually cheaper to rent a home in New Zealand than it is to own one. No matter who owns the house, housing costs in New Zealand are extremely high.

Private rental providers are part of the solution to having more rental properties for tenants and lower rental price increases.

It costs considerably more for government and non-profit organisations to house a tenant than the private sector. These other organisations have well paid layers of management while the vast majority of private providers are ordinary people owning one or two rentals who don’t pay themselves for the many hours they spend running their rental.

So, the NZPIF is not anti-regulations for rental properties and we do not want our customers living in unsuitable conditions. The answers are not simple but we genuinely care about tenants and are well placed and committed to help improve renting in New Zealand. We are not the problem we are sometimes portrayed to be but are actually part of the solution.

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