A national survey of Property Managers and Landlords has discovered that 4 out of every 5 people believe tenants should occur a penalty for late payment of rent. Director of Real-iQ, David Faulkner believes it’s a no brainer; if the penalty is instated less cases will make it to the Tenancy Tribunal therefore long term it will save the tax payer, tenants and landlords money. It will also reduce waiting times for tribunal hearings as tenants will be less likely to fall into arrears.
Real-iQ provides training and consultancy for companies across New Zealand that combined manage approximately 10,000 properties. Their findings show that very few tenants pre-warn their Property Managers if they are going to fail to pay rent. There appears to be a lack of consequences for tenants who pay their rent late and many do not see it as a priority. A late payment penalty would incentivise tenants to pay their rent on time. With less tenants falling into arrears, we would see a dramatic reduction in the amount of applications being lodged to the Tenancy Tribunal.
Rent arrears make up over 80% of applications and Mr. Faulkner believes that a 10% late payment penalty would reduce the wait for a tribunal hearing by approximately 50%. We fully acknowledge that the vast majority of tenants look after properties and pay their rent when it is due and we also believe that landlords have a social responsibility to provide compliant properties that are warm and safe for tenants.
We are also fully aware that the cost of renting has increased for tenants, however what is less reported are the increased costs of being the landlord which includes meth testing, insulation and compliance. It seems unfair that a Landlord may be penalised by a bank for defaulting on a mortgage payment.
Mr. Faulkner is available for comment regarding the survey
About Real-iQ. Real-iQ are experts in all things Property Management. With over 50 years combined industry knowledge we are passionate about the industry and have a strong desire to help create an industry we are all proud to work in. We help our clients be the best they can be through training and consultation, recruitment, social media training and management, rent roll brokerage, business analysis, contractor agreements, human resources, webinars, podcasts and newsletters. Licensed under the REAA 2008.