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SocietyMarch 24, 2017

40 people to a property, eight people to a room: inside the nightmare that is renting in Queenstown

Queenstown renting_feature2

Behind the affluent image of luxurious resorts and million dollar homes there is another, far darker side to life in Queenstown. Peter Newport investigates the shocking state of the town’s rental market and what it means for those caught up in it.

Queenstown is now no place to live. Every ad for every rental property here produces a feeding frenzy that is not pretty to watch and shows no sign of improving. It’s a situation that Queenstown is increasingly ashamed of and it means that anyone even thinking of coming here to live without at least $1 million cash should maybe forget the idea and go somewhere easier – like London, Sydney or New York.

Things are now so bad that people are starting to advertise themselves as tenants with perky little online profiles – long before they even get here. Two or three hundred responses to one Queenstown rental post is not unusual. Add a dog, a child, be over the age of 35 or have a baby and you are pretty much screwed.

Queenstown. Photo: Getty Images

The Facebook meat market that is the Queenstown For Rent page – a closed group with over 19,000 members chasing perhaps 3,000-5,000 rental properties – pulsates with the suppressed tension of property owners engaging with the low hanging fruit of desperate tenants. Here’s the menu: $125 a week for a single room (multiple beds/bunks) shared with up to four other people, $200/$250 for a single room in a shared house, $350/$450 for a single room with its own bathroom in a shared house, $750/$1,400 a week for a basic house or townhouse.

Try to get a job in Queenstown and the first question is “Have you got a confirmed place to live?” Answer no and most employers will show you the door, provide directions to the airport bus and say bad luck.

I started researching the Queenstown rental market over a year ago. Usually, as a journalist, it’s hard to get people to talk openly about bad landlords for the simple reason they may get kicked out onto the street and have nowhere to live as a result. But here people queue up to tell their horror stories – there’s safety and strength in numbers.

In my first week of research I discovered a house where overseas tenants had their passports taken off them as collateral, hot water or the internet were turned off as a punishment for complaining about the lack of heating, and the tenants were blackmailed with losing their jobs if they revealed the conditions at the house.

Another place I visited had rats and mice running around (in their own droppings), 17 people crammed into an apartment that was just a third of one house, broken windows, doors and floors – plus the landlord had put a one hour timer on each of the 1960’s vintage heaters.

I also visited the legendary “Castle of Fernhill” a modest A-frame house in Avalon Crescent which at that stage had 40 people living in it. It’s been cleaned up since… and is now advertising for an unspecified number of tenants at $130 a week to stay in nine bedrooms sharing five bathrooms.

Inside a caravan earning $345 in weekly rent. Photo: Peter Newport

2016 was the year we saw small Queenstown rooms being divided into even smaller units with bed sheets hanging from the ceiling. ‘Hot bedding’, where two different people (often shift workers) share one bed – 12 hours on, 12 hours off – became a thing. People now advertise to rent someone’s driveway so they can live in their cars on private property.

Recently I was contacted by a tenant who told me about a multi-tenanted property near the airport where he claimed 50 people were living. (The landlord later contacted us to confirm that the true number was 31).

I visited the airport property and found the owner, Robyn-Jane Chernishov, was away in Cromwell as part of her dog-breeding hobby. There are two properties on opposite sides of the street, which appear to be owned, and the rates paid, by The Chernishov Trust.

At 3 Remarkables Crescent, one of the two properties, I saw over 20 pairs of shoes in the entrance area, with corridors peppered with hundreds of dead moths stuck to fly paper hanging from the ceiling. A tenant I spoke to said that one single room had been partitioned with plywood to create beds for eight people. Another tenant showed me his windowless room with two bunk beds crammed against the wall. There was not enough space for the door to open properly. I found one toilet, with a notice instructing tenants to clean the toilet and the floor – “Much Appreciated, Robyn-Jane”.

Across the road at the second Chernishov property, 4 Remarkables Crescent, the door was locked, with another notice attached “Dear Valued Tenants. Please text to make an appointment.” I tried to contact Robyn-Jane Chernishov on a number of occasions by phone and text but there was no reply. I was warned by the tenants that “she does not take phone calls”. [Update, March 28: Robyn-Jane Chernishov has since emailed responding to this article; see note at the foot of this post.]

By the door with the “please text” notice was a small, dirty, run down caravan, containing three tiny beds buried by luggage, thin blankets and scattered clothes. I spoke to the one tenant who was in the caravan.

The tenant told me that three people are living in the caravan. He paid $105 a week to Robyn-Jane Chernishov for the smallest bed and the others paid $120 for the other two beds. There was no obvious way to cook food, no heating, no water and no toilet.

This is the dark underside of Queenstown’s booming tourism industry where even the local National MP Todd Barclay says that people can’t live on the minimum wage.

I’m struggling to understand how this is different to the sweatshops in Asia that we try to grandly condemn by not buying clothes or electronic products made under such conditions. I have a strong feeling that some of those sweatshop workers might live in better conditions than Queenstown’s small army of minimum wage workers who keep our tourism machine rolling.

Ex-Aucklander Steve Ginn used to live at Number 3 Remarkables Crescent and frequently complained about the living conditions. He was evicted as a troublemaker in 2014 but took the Chernishov Trust to the Tenancy Tribunal. He won $100 in 2015 because his bond had not been lodged with the Tenancy Services Agency. His other multiple complaints, including that the inside of the food fridge was cleaned with a floor mop, were all thrown out. The tribunal adjudicator Maxine Knowler ruled: “On a full and careful consideration of the evidence, I am left with the overriding view that the tenant was not suited to boarding house life and displayed little ability to compromise.”

I spoke to Ginn, now living in Invercargill and working night shifts. Ginn is still angry and believes strongly that the Queenstown conditions he lived in were totally unacceptable. He says his character was unreasonably attacked at the Tenancy Tribunal hearing.

3 Remarkables Crescent, Queenstown. Photo: Peter Newport

I asked the Queenstown Lakes District Council if the accommodation at numbers 3 and 4 Remarkables Crescent was something they could act on, but the Council’s view is that nothing illegal is happening and tenants can always complain to the Tenancy Tribunal. On the Council’s rates database, the building at 3 Remarkables Crescent is classified as a ‘clinic’, from the time many years ago when it was The Frankton Medical Centre. The Council could see no issue with the three people being charged to live in the caravan at number 4 Remarkables Crescent “unless there is a complaint”.

Just yesterday I saw a Facebook post from a young, self-employed builder moving from Queenstown to Wanaka and offering to pay $500 a week for a single room “plenty of work – $’s not a problem”.

The reason for this ever-worsening mess is simple and connected to the white-hot local building industry. Nobody can afford to build new, affordable accommodation. An eye-watering $3,000-$4,000 per square metre is now a standard cost of building a house in Queenstown (that’s a million bucks for a 250 square metre build – no land or consents included). New hotel rooms (even hostel rooms) are coming in at $1 million each as well. Result – nothing much is being built for rent.

So, the notoriously ancient, cold and decaying holiday homes of the 1960’s are now essentially the total rental stock for Queenstown.

I asked the managing director of one of the town’s most active rental agencies, Queenstown Accommodation Centre’s Allan Baillie, if he thought things had reached a breaking point.

“The conditions being applied by some private Queenstown landlords are wrong,” said Baillie. He says it’s not the overseas rental market investors that are causing the trouble, but domestic, Kiwi landlords. Baillie blames these local landlords for the caravans in driveways and the trench warfare conditions in the Queenstown rental market. “It’s the overseas investors that are using rental agencies and doing things by the book,” he tells me. He might be right.

But it gets worse. Enter Airbnb.

A screengrab showing Airbnb rentals on Frankton Road in Queenstown. All prices are for an entire property for a single night

Queenstown’s rental market is now spectacularly skewed towards short term Airbnb use. It means that long term rentals are even harder to find. On the road where I live, the past 12 months has seen any owner-occupiers move out, leaving the houses 100% rented, often through Airbnb at $400 plus per night.

Garages have been converted to makeshift rooms. There’s no meet and greet – just confused, jet-lagged tourists in rented 4WD’s trying to find the front door key at dusk and reading the emailed Welcome instructions from their fluorescent smartphone screens.

The Queenstown Lakes District Council, like many local authorities all over the world, is now trying to clamp down on Airbnb, to ease pressure on accommodation for workers. They’ve been cruising the online listings and have sent out letters to around 800 private Airbnb operators warning of increased rates. There’s even instances of long term tenants renting out part of their place on Airbnb, without the landlord’s permission, to make some extra cash. Chaos.

So where does this all end up? Most of the affordable accommodation initiatives have collapsed and even the Government’s Special Housing scheme has been hijacked down here by developers wanting to build grand retirement villages where the units can cost up to $700,000. The defence of the Special Housing scheme shifting to massively profitable retirement home construction is that it will free up the houses that retired people will sell, meaning more housing supply. It’s just a happy accident that the developers get to by-pass the Resource Consent process due to the Special Housing rules.

But these Queenstown houses that retiring people will sell are going to average well over a million dollars – so they make zero economic sense to the low-paid rental market.

It’s a bleak situation, prompting even the Chamber of Commerce CEO last year to warn people not come to Queenstown until the situation is fixed.

One of the area’s biggest employers, NZSki, experimented during the last ski season with providing rooms in Cromwell, an hour’s drive away. The experiment did not work, with most ski field workers preferring the accommodation nightmare in Queenstown to two hours commute each day and lost opportunities to party in the multiple, cheap bars here.

Other countries have figured out solutions. The French Government, in particular, makes massive ski resorts like Chamonix function by providing large scale low cost worker accommodation, optionally on a rent to buy basis. Perfect. Simple. Fair. Sustainable. Makes total economic sense.

The really crazy thing is that of the many distressed and disadvantaged tenants I’ve spoken to, most still want to live in Queenstown. Just without the rats, the insane rents, the health risks, the broken windows, the lack of heating. Unfortunately our tourist boom continues to be unaccompanied by a building boom, so profiteering from the desperate and slum-like squalor looks like it’s now as much part of the Queenstown experience as Ferg’s or the lake itself.

Update, March 30: The Spinoff has received a letter from lawyers representing the Chernishov Trust, which operates the property at 3 Remarkables Crescent, Queenstown. The letter notes that only one room in the building is windowless; that the partitioned room mentioned above has six beds, not eight; and that the property has four toilets in total. The letter also notes that tenants sleeping in the caravan have access to cooking facilities in the main building and are provided with a heater.

Update, March 28: In an email to the Spinoff, March 27, Robyn-Jane Chernishov, who did not reply to numerous requests for comment initially, responded with written notes from her son. He claims that the “the current tenants are happy living in the boarding house”, adding: “the property is a large commercial building, and has been upgraded to meet the stringent fire safety requirements for a boarding house. The property is neat, tidy, well maintained and modern inside … No current tenants are unhappy living there.”

He says six, rather than eight, people live in the single room mentioned and that “it contains separate areas with partitions that do not reach the ceiling so as to comply with council regulations”, and disputes the suggestion the door could not be fully opened, writing: “It is likely the door could not be opened properly because the tenants possessions were on the floor behind the door.” The building, it is stated, “has four toilets – two down stairs and two upstairs” and “is cleaned daily by a professional cleaner”.

Of the caravan being rented out, he writes: “It is around 40 years old so doesn’t look sparkling new – however ‘small and dirty’ is a bit of a stretch. The demand for accommodation has reached crisis point. People pleaded with my mother to let them stay in her empty caravan – otherwise they were sleeping in parking lots in their cars.”

This post is part of Rent Week, our week-long series about why the experience of renting a home in NZ is so terrible, and whether anything can be done to fix it. Read the entire series here.

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