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External Research Report

ER78 [2022]

The New Zealand Rental Sector

SHORE & Whariki Research Centre, Massey University, funded

by the Building Research Levy

ISSN : 2423-0839

This research was funded by BRANZ Building Research Levy.

The research was conducted by Karen Witten, Penelope Carroll, Simon Opit, Karl Parker, Thomas Grayson-Guy

and Taisia Huckle from SHORE & Whariki Research Centre, Massey University.

We acknowledge the support and advice for this research provided by Alison Reid and Jennifer Joynt, Auckland

Council and thank Dr Bev James for her detailed and thoughtful peer review of the report. In addition, we

thank the many tenants and landlords who participated in the survey and subsequent interviews.

Contents

List of Tables .......................................................................................................................................................... 5

Executive Summary ................................................................................................................................................ 6

Tenants ............................................................................................................................................................... 6

Landlords ............................................................................................................................................................ 7

Introduction ........................................................................................................................................................... 9

Report Structure .................................................................................................................................................. 12

Methods ............................................................................................................................................................... 12

Component 1: Tenant Surveys ......................................................................................................................... 12

Component 2: Landlord Survey ........................................................................................................................ 13

Component 3: In-depth interviews .................................................................................................................. 13

Results .................................................................................................................................................................. 14

Section 1: Survey and in-depth interviews with tenants ................................................................................. 14

Demographic and socio-economic characteristics of the tenant sample .................................................... 14

Renting pathways ......................................................................................................................................... 16

Rental housing affordability and tenure security/insecurity ........................................................................ 19

Tenancies arrangements and experiences ................................................................................................... 23

Heath and disability ..................................................................................................................................... 29

Intentions/expectations for the future ........................................................................................................ 29

Reflections on renting .................................................................................................................................. 30

Section 2: Survey and In-depth interviews with landlords ............................................................................... 33

Demographic and socio-economic characteristics of the landlord sample ................................................. 33

Investment rationale .................................................................................................................................... 35

Family matters ............................................................................................................................................. 38

Selecting rental property ............................................................................................................................. 38

Financing rental property ............................................................................................................................. 41

Managing and maintaining rental properties .............................................................................................. 43

Regulation and standards ............................................................................................................................ 48

Tax regulation changes for investment properties ...................................................................................... 49

COVID-19 impacts ........................................................................................................................................ 50

Future intentions .......................................................................................................................................... 50

Discussion ............................................................................................................................................................. 52

References ........................................................................................................................................................... 56

List of Tables

Table 1: Ethnicity of tenant sample ..................................................................................................................... 14

Table 2: New Zealand born by city – tenants ....................................................................................................... 15

Table 3: All sources of income received by tenants in previous 12 months by city ............................................. 15

Table 4: Household income by city – tenants ...................................................................................................... 16

Table 5: Length of time at current address .......................................................................................................... 18

Table 6: Total weekly rent on properties ............................................................................................................. 20

Table 7: Affordability of housing .......................................................................................................................... 20

Table 8: Days taken for maintenance request to be resolved ............................................................................. 24

Table 9: Satisfaction/dissatisfaction with maintenance of property ................................................................... 25

Table 10: Priorities for expenditure on property improvements ......................................................................... 26

Table 11: Median age of landlord sample ............................................................................................................ 33

Table 12: Landlord labour market status ............................................................................................................. 34

Table 13: All sources of income received by landlords in previous 12 months by city ........................................ 34

Table 14: What were your original reasons for deciding to invest in rental property? ....................................... 35

Table 15: Purchasing preference .......................................................................................................................... 39

Table 16: Advantage of existing properties ......................................................................................................... 39

Table 17: What type of mortgage do you have on your rental properties .......................................................... 41

Table 18: Mean weekly rent by city ..................................................................................................................... 42

Table 19: What is the combined value of your New Zealand properties (in NZD) by city ................................... 43

Table 20: Do you manage your properties yourself or do you use an agent? ..................................................... 44

Table 21: What are the advantages to a landlord of fixed, long-term tenancies? ............................................... 47

Executive Summary

This report details the findings of research undertaken with tenants and landlords on their experiences of the

private rental sector. Data were gathered in 2021, using telephone and online surveys with tenants, a

telephone survey with landlords and in-depth interviews with sub-groups of tenants and landlords.

Participants resided in Auckland, Wellington, Christchurch and Dunedin. The study was designed to replicate

research conducted in 2015, however an extended COVID-19 lockdown in Auckland necessitated modification

to the tenant survey data collection methods. Key study findings on tenants’ experiences of renting, combining

all sources of data, are presented followed by findings on landlords’ views on the sector.

Tenants

The tenants’ survey gathered data from 812 respondents on their housing histories, the characteristics of their

current rental home, future housing plans, and experiences of their tenancies and accommodation. Forty

tenants took part in in-depth interviews that covered a similar range of topics.

The mean age of survey respondents was 43 years, 52% were female, and 48% male. The ethnicities of

respondents (allowing reporting of multiple ethnicities) were as follows: European 66%, Māori 10.5%, Pacific

8%, Asian (including South Asian) 20% and other 3%. Of the sample, 72% were employed and 43% had a

household income below $70,000. Fifty-nine percent of respondents lived in Auckland, 15.2% in Christchurch,

14.3% in Wellington and 8.5% in Dunedin.

Trade Me was the most common route used by tenants to identify a rental property. Around 30% of tenants

secured the first rental property they applied for and a further 26% after applying for one or two properties.

Nine percent had applied for more than 10 properties before securing their home. A higher number of moves

in the previous five years was associated with greater difficulty securing a rental home. Feeling unfairly turned

down by a landlord was indicated by 29% of tenants and this was most often attributed to their ethnicity or

age, followed by having pets and/or children.

Tenants had had diverse housing pathways. Rental tenure had been a long-term situation for many, but others

(30.5%) had moved in and out of home ownership. Most of the latter group no longer owned a property, with

the main reason for selling being the breakup of a relationship (38%). Some of these tenants had become

renter-owners, unable to afford to buy in an area where they wanted to live, they had purchased an

investment property elsewhere and rented a house in a location or of a size that met household needs.

A quarter of tenants surveyed had lived in their current home for less than a year, and just over half the

sample for less than two years. Conversely, 12.7% had lived in their current rental home for more than 10

years. A frequent scenario in long-term tenancies was a dwelling in poor condition, retained at below market

rent, with good tenant-landlord relations. This situation often led to a reticence to ‘rock the boat’ and risk a

rent increase. Seventy-two percent of tenants had moved to their current address from another private rental

property.

Mean weekly rents per dwelling were highest in Wellington ($617) and on Auckland’s North Shore ($598). The

mean rent paid per bedroom was also highest for Wellington ($258), followed by Auckland ($230),

Christchurch ($158) and Dunedin ($150). Three-bedroom homes were the most common dwelling type –

rented by 34% of survey respondents. Flatting, while desired by some tenants, was a compromise for others,

especially older renters, who made ends meet by sharing costs.

Affordability was a concern to many tenants interviewed, and 38% of survey respondents indicated their rent

was unaffordable. Of the remaining tenants, 45.5% reported their rent was affordable and 82% said their

rental accommodation met their household needs. Despite the latter figure, 47% of tenants said they planned

to move in the next two years, either to alternative rental accommodation or to a home they hoped to buy, or

for a few, to a place they already owned.

A tenancy agreement had been signed by 88% of tenants, 87% had paid a bond on the property, and 67.5%

knew their bond had been lodged with Tenancy Services. A fixed-term tenancy had been negotiated with a

landlord or property manager by 45% of tenants, with one year the most common fixed time period. Rent was

paid directly to a landlord by 64% of tenants and 35% paid rent to a property manager. Tenants who paid rent

directly to a property manager paid $50 per week more on average than those who paid rent to a landlord,

$560 compared to $510 per week.

Smoke alarms were reported as installed in 93% of rental properties and absent in 6% of homes. A high

percentage of tenants (76%) had contacted their landlord or property manager concerning maintenance on

the property, with minor plumbing and electrical issues the main concerns. Sixty percent of issues were

resolved within five days, 21% between 6 and 15 days and 18.5% took 16 days or longer to be resolved.

Just over half the tenants identified the Tenancy Tribunal as where they would go with a tenancy related

problem. Only one interviewee had previously done so and found the experience time consuming and

stressful. Others said they would not take a complaint to the Tenancy Tribunal for fear of reprisals such as a

rent increase or loss of the tenancy.

Asked if they thought housing was related to health, 83% said yes, 10% no and 7% said they did not know. A

household member regularly sleeping in a room other than a bedroom was reported by 10.5% of respondents.

Ramps and rails were the most common modifications requested to assist disabled tenants.

Few tenants reported COVID-19-related impacts on their rental situation, other than a drop in property

inspections. They had adapted spaces if needing to work from home and most had not approached their

landlord for a reduction in rent. However, a rent hike soon after the rent freeze ended was noted, and a lack of

properties advertised for rent during lockdowns contributed to the stress and uncertainty of seeking a new

home.

Landlords

Four hundred and twenty landlords completed the landlords’ survey, 34 of whom also participated in an in-

depth interview. The mean age of respondents was 59 years (four years older than in the 2015 survey) and

New Zealand European or European ethnicity was reported by 78% of landlords. A further 7% were of Indian

ethnicity and 2.5% Chinese. Forty-four percent were in paid employment, 29% retired and 21% indicated they

were self-employed. A household income of over $150,000 was reported by 39% of landlords.

Half the landlords (52%) owned a single rental property, 26% owned two, 10% owned three properties, and

the remaining 12% owned more than three properties. The median length of time they had been a landlord

was 15 years. The most frequent reason given for purchasing a first and/or most recent rental property was as

a form of retirement savings. While retirement planning was the predominant rationale there was some

variation across the sample. A small number of landlords sought to build a portfolio of properties as a business

and/or as a form of wealth creation. Rental investment decisions were often influenced by family

considerations, for example, to provide accommodation for older relatives or to provide homes or investment

capital for the next generation.

While most landlords owned properties in their city of residence and ‘close to where I live’ was the most

common reason given for their locational choices, 22% of landlords in Auckland, 20% in Wellington, 18% in

Christchurch and 14% in Dunedin owned rental properties in cities and towns other than where they lived.

Two thirds of landlords expressed a preference for purchasing second-hand dwellings, a slightly lower

percentage than in 2015. Their cheaper price, ease of purchase and potential to make improvements were the

primary reasons given for favouring older properties. Downsides were maintenance and compliance costs. An

increasing interest in new builds may be attributable to tax advantages relative to older dwellings as well as

Healthy Homes Act requirements already being met and minimal maintenance being required.

Half the landlords surveyed (50.6%) indicated they had used accumulated savings to fund the deposit on their

first rental property and a further third (33.6%) had used equity in an existing home to release funds for a

deposit. Just under a third of landlords (31.5%) had no mortgage on their rental property, a slightly higher

figure than reported in 2015 (26%). The percentage of landlords without a mortgage increased by age from 0%

for the age bands under 40 years to 53.9% for those over 65 years.

Drawing on equity in other property, buying cheaper dwellings, and interest only mortgages were strategies

landlords used to start or expand their rental portfolios. Asked about the average rental yield on their rental

property /properties, half (51%) said they did not know, lower than the 59% who responded similarly in 2015.

Of those who indicated they did know, 11% said their average yield was either 1 or 2%, 21% said either 3 or

4%, and 11.3% said 5, 6 or 7%.

In keeping with data from the tenants’ survey, mean rents reported by landlords were highest in Wellington

($597), followed by Auckland ( $550), Christchurch ($419) and Dunedin ($381), and were $50 per week higher

on average when paid to property managers compared to a landlord. Of the 818 rental properties owned by

survey respondents, 33 were unoccupied, all but five due to refurbishment, sale or re-tenanting.

Selecting tenants was primarily based on ability to pay rent and care for the property, with common criteria

being good references, a secure job, good impression on meeting and ‘gut instinct’. Most landlords (95%) had

signed tenancy agreements on all rental properties and 92% said they had collected and lodged bonds (higher

than the corresponding figures of 92% and 81% respectively in the 2015 survey). Fixed, long-term tenancies

were favoured and used by 43% of landlords, the benefits being keeping good tenants and certainty of

cashflow.

Over half the landlords (55%) managed properties themselves, 38% engaged a property manager, and 5% did

both. Satisfaction with the competence of property managers was high (85%) and 78% were satisfied the

service provided value for money. Of the landlords who managed properties themselves, some did so for

financial reasons but others enjoyed contact with tenants. The percentage managing properties themselves

was lower than the 67% recorded in 2015, possibly a reflection of the older mean age of landlords in the

recent survey.

The median annual maintenance expenditure per property was estimated at $3,000. Structured maintenance

plans were more common when property managers were employed. Landlords managing properties

themselves did repairs ‘as and when needed’, relying on tenants to let them know when repairs were needed,

and inspections were rare with trusted tenants.

Most landlords (94%) thought there was a link between people’s housing and health. The Healthy Homes

Legislation requirements were largely accepted and met, although some dissent remained over the need to

install heating. Meeting specific needs of disabled tenants was reported by 10% of landlords, with ramps and

rails accounting for two thirds of modifications. When asked, 11% of landlords said they had accommodated

additional tenants in their properties in response to the housing shortage.

Landlords held diverse views on more recent regulatory changes allowing tenants to make modifications to the

property and the removal of no cause termination some were supportive, and others opposed. Frustration at

changes to tax settings for rental properties was common, with many landlords feeling they were being

scapegoated and unfairly blamed for the unaffordability of housing. The numbers of landlords intending to

purchase additional rental properties dropped between 2015 and 2021, down from 26% to 15%. The most

common barriers to investing in rental property were reported as uncertainty about current and proposed

changes to government policy (37%), followed by rising house prices (32%) and access to finance (20%).

Intention to sell rental property was also higher in 2021 (21%) than 2015 (15%), however most landlords had

no plans to divest of rental property.

Landlords reported minimal disruptions attributable to COVID-19 other than being unable to inspect or re-

tenant properties during lockdowns. Few tenants asked for a rent reduction and communication continued

through phone and email.

Less than 4% of the landlords said they belonged to a Property Investors’ Association.

Introduction

The context of this research is a shift in housing tenure patterns in Aotearoa New Zealand (NZ). Renting,

formerly a transitional phase prior to homeownership for most, is becoming life-long tenure for increasing

numbers of New Zealanders, as homeownership/owner-occupier

rates continue to decline. Renting has not

traditionally been part of the Kiwi dream and is considered ‘a second-rate option’ (Eaqub & Eaqub, 2015, p.

10). Yet, a third of New Zealanders (and half of the adult population) are now renting their homes. It is

estimated that of NZ’s 1,771,300 households (June 2019), 604,100 (or 34%) are renting and the overwhelming

majority of these households, at around 510,000 or 85%, rent within the private rental sector (PRS) (New

Zealand Property Investors' Federation, 2022; Stats NZ, 2019a). Homeownership rates have correspondingly

fallen, from a high of 74% in 1991 to 65% in 2018. While rates have decreased across all age bands, they have

especially fallen for those in their late 20s and 30s (from 61-44% and 79-59% respectively (Stats NZ, 2020).

The shift in tenure has been in large part due to increases in house prices and rental costs relative to incomes,

and in the investor share of the housing market. A doubling of median house prices over the past decade,

compared with wage increases of only 20%, has put homeownership beyond reach for many. Housing market

activity has continued to move toward property investment and away from first home buyers (Saville-Smith,

2021), with CoreLogic data suggesting only 21% of house sales were to this group in March 2022 (down from a

recent high of 26% in 2020) (CoreLogic, 2022).

It is forecast that a majority of households will be dependent on the private rental sector for housing within

the next two decades (Saville-Smith, 2019; Stats NZ, 2019a). In response to this situation, and the poor

condition and unaffordability of rental housing, the Human Rights Commission (2021) has developed Human

Rights Guidelines for a Decent Home based on United Nations standards for adequate housing.

Regulatory context

In NZ it can be argued that a rental property is regarded first and foremost as an asset to benefit the landlord,

privileging ownership and determining the extent to which ‘secure occupancy’ exists for tenants (Hulse &

Milligan, 2014). The concept of ‘secure occupancy’ encapsulates legislative protection, secure tenure

(including affordability) and tenants having control over their living space, provided they meet their legal

obligations as a tenant.

Tenants and landlords’ legal rights and obligations are covered by the Residential Tenancies Act (1986) and its

2020 amendments. Provisions cover payment of bonds and rents, termination of tenancies and recovery of

possessions, and Tenancy Tribunal processes to resolve disputes between tenants and landlords. Prior to the

COVID19 pandemic, tenancies could be terminated without reason by a landlord with 90 days’ notice (or 42

days if the property owner or their family planned to move into the property), and rents could be increased

every six months. Reflecting the importance of people being securely housed in a COVID-19 world, provisions

allowing no-fault terminations and six-monthly rent increases were suspended in March 2020. The Residential

Tenancies Amendment Act (August 2020) cemented these changes: no-cause terminations are no longer legal;

rents can only be increased annually (and any increase requires a 60-day notice period); fixed-term tenancy

agreements automatically become periodic tenancy agreements upon expiry (unless both parties agree

otherwise); and tenants now have the right to carry out ‘limited’ home-making practices to personalise their

living space (in consultation with the landlord). These changes are intended to afford tenants greater ‘secure

occupancy’. However, landlords still retain the right to terminate tenancies if they want to extensively

renovate or sell a property (90 days’ notice) or move themselves, family members or employees in (63 days’

notice). In terms of the condition of rental accommodation, the Act states that “the landlord shall provide and

maintain the premises in a reasonable state of repair” (Section 45b).

‘Homeownership’ and ‘owner-occupier’ are used interchangeably throughout the report. Home-

owners/owner-occupiers are defined as people who live in a dwelling they own or part own, with or without a

mortgage.

Cold damp housing in particular has been highlighted as a significant health issue in NZ (Buckett et al., 2012;

Howden Chapman et al., 2007; Keall et al., 2010). Building research and industry surveys have identified

widespread issues with poor maintenance, insufficient insulation and ventilation. Research has also found that

rental dwellings in NZ are typically in a worse condition than owner-occupied dwellings (White et al., 2017)

and twice as likely to be cold, damp and poorly maintained (Stats NZ, 2019b). The Healthy Homes standards

(which became law in July 2019) aim to address these issues, requiring specific and minimum standards for

heating, insulation, ventilation, moisture ingress and drainage, and draught stopping in rental properties. All

private rentals were to comply within 90 days of any new or renewed tenancy, with all private rentals

complying by July 1, 2024. However, on 22 November 2022, the Housing Minister announced an extension to

July 1, 2025 and an increase in the compliance timeframe for new or renewed tenancies from 90 to 120 days

(Woods, 2022). Whilst advocates for improving renting conditions celebrated the introduction of these

standards, the requirements remain relatively limited and a strong counter-narrative has pushed back against

‘excessive’ government regulation of the PRS (Bierre & Howden-Chapman, 2020). Recognising the need to

ensure standards are being met, the Human Rights Commission is calling for an independent housing authority

to regulate the quality of rentals, including compliance with the Healthy Homes standards (Alafeshat, 2022).

Housing and health

Housing is related to health in myriad ways which, when added together, make it a key social determinant of

health (Marmot & Allen, 2020; Shaw, 2004). On a physical level, poorer housing conditions, coupled with a lack

of tenure security, are linked to poorer health outcomes, academic achievement, rates of employment and

subjective wellbeing (Howden-Chapman & Carroll, 2007; Keall et al., 2010; Saville-Smith, 2019). On a

psychosocial level, house/home is linked to ‘our sense of identity; our relationships with one another; our

understanding of who we are and how we fit in the greater scheme of things’ (Dawson & Jordan, 2020, p. 5).

Dupuis and Thorns (1998, p. 25) write of homeownership fostering ‘ontological security’ – a security of being.

Bate (2018) identifies three factors necessary for secure occupancy: financial security, housing stability, and

autonomy over homemaking practices. She argues it can be challenging for renters to achieve secure

occupancy and establish a sense of home within their dwelling. Without some place to call home ‘people

are…essentially disenfranchised’ (Kearns et al., 1991, p. 369) and their health and well-being are compromised.

On both a psychosocial and physical level, rental housing is regarded as less healthy than owner occupied

housing in NZ.

Historical context

In NZ homeownership continues to be seen as the best way to ‘house the nation’ (Ferguson, 1994), and

government policies have reflected this. Historically governments have provided mortgage support for first

home buyers along with funding public housing. A century ago, 50% of workers owned their own homes

(Atkinson, 2005), with housing loans made available through the Reform Government’s State Advances

Corporation. Construction of public housing to complement private ownership began under the first Labour

Government (1935), with a Housing Construction Branch of the State Advances Corporation established to

build state houses (Dalley & McGibbon, 2005, p. 282). Local authorities were also funded to provide housing,

which was mostly pensioner housing. The 1949 National Government moved away from a universal state

housing approach, making more money available for private construction. This shift continued, with 3%

building loans and capitalisation of the family benefit under the Second Labour Government (1957–60)

boosting rates of homeownership. At the peak of housing activity in 1961, 52% of all new dwellings were

government funded in some way (Dunstall, 1981). The easing of housing supply issues in the 1970s saw

governments retreating from involvement in the construction and financing of new houses. Private institutions

(banks and building societies) became the prime source of mortgage money, and the private sector were

encouraged to provide rental accommodation. With the rise of neo-liberalism from the 1990s, governments

continued to draw back from the funding or provision of housing. This policy environment, along with

favourable mortgage market conditions, contributed to the number of rental property investors rising from

75,000 to over 200,000 between 1997 and 2007 (New Zealand Productivity Commission, 2012). The

introduction of a tenure neutral ‘accommodation supplement’ in 1993 was intended to reduce state provision

of rental housing and assist the majority of low-income people into the private rental market (Murphy, 2004).

The supplement was costed at almost $2.4 billion in the 2020 budget. The current nationwide undersupply of

housing (estimated by Kiwibank Chief Economist Jarrod Kerr to be around 65,000 dwellings) is an outcome of

decades of underinvestment in private and public housing, says Saville-Smith (2018). Saville-Smith also notes

the ‘desertion’ of lower-value segments of the market by the building industry.

An eventual government acknowledgement of a ‘housing crisis’ has seen interventions in land-use planning,

increased government investment in public housing and communal infrastructure to support housing

development, and the advent of KiwiBuild, all policies designed to increase housing affordability by increasing

supply. However, house prices have remained ‘over-heated’ and affordability issues have spread to the rental

market (Saville-Smith, 2019). According to figures reported by the OECD, 60% of NZ’s low-income renters

spend more than 40% of their income on rent – the highest rate in the OECD (OECD Affordable Housing

Database, 2022, p. 5).

Along with moves to increase the supply of housing for first home buyers (reduced tax deductibility for

investors and extension of the ‘bright-line’ test to limit investment in housing for capital gain), the government

has announced tax exemptions for developers offering long-term tenancy opportunities. While the rhetoric of

owner-occupation as the norm remains, these changes recognise the need to address the recent changes in

tenure patterns that have resulted in a permanent rental class – and a need to encourage long-term ‘secure

occupancy’ (Hulse & Milligan, 2014) for tenants.

With housing tenure affecting a range of economic, social and health outcomes, it is important NZ has a clear

understanding of the private rental sector from both tenants and landlords’ perspectives. It is also important

to understand the demographic characteristics of the renting population. How has it changed over time, and

does the rental stock meet the needs of its inhabitants? Following on from the prior investigation of the

private rental sector in 2015 (Witten et al., 2016), this two-phase study surveyed a random sample of tenants

and landlords in Auckland, Wellington, Christchurch and Dunedin in 2021; and conducted follow-up interviews

with a subsample of those surveyed to understand more fully their experiences, priorities and plans within the

private rental housing sector.

Report Structure

First, the research methods used to collect and/or analyse data for three study components are described: a

survey of tenants that combined data collected via Computer Assisted Telephone Interviewing (CATI) and a

shorter online survey; a (CATI) survey of landlords; and in-depth interviews with a subsample of the CATI

survey respondents, both tenants and landlords. Study results are then presented for the analyses of data

gathered from tenants, followed by results for the data gathered from landlords.

Demographic descriptions of the relevant samples of CATI, online survey and follow-up interview respondents

precede a series of thematic headings that combine findings from analyses of data gathered via the surveys

and in-depth interviews. Where relevant, comparisons are made to findings from an earlier New Zealand

Rental Sector Study, based on data gathered in 2015–2016. In the tenants’ section of the report, topics

covered include tenants’ experiences in the rental market, specifically finding and securing rental properties,

rents, reasons for moving, property management and maintenance, expectations about property standards,

tenancies, as well as future plans for accommodation and their reflections on the rental housing market. In the

landlords’ section, topics covered include investment rationales, portfolios and financing, property

maintenance, managing tenancies, regulations and standards, future intentions and their reflections on the

rental market. The results sections are followed by a discussion and concluding comments.

Methods

Replicating the 2015–2016 study, data in 2021 were gathered across four sites, Auckland, Christchurch,

Wellington and Dunedin. The areas selected correspond to the Unitary authority area for Auckland; to

Christchurch City, Rangiora ward and Rolleston for Christchurch; to Dunedin City for Dunedin; and to

Wellington City, Porirua City, Lower Hutt City and Upper Hutt City for Wellington. The sites were chosen to

enable comparisons between landlord and tenant experiences across different large urban centres.

The 2021 survey was disrupted by the COVID-19 pandemic. The CATI laboratory could not operate during the

extended Auckland lockdown from August 2021. The Landlords’ survey was completed by CATI interviewers

set up to work remotely, but the Tenants CATI survey was terminated and a sample of tenants recruited and

data collected via an online panel survey conducted by Kantar Research. The online survey format necessitated

a shortened survey. A final response rate cannot be calculated due to the survey’s disruption by the extended

lockdown in Auckland.

Component 1: Tenant Surveys

CATI Survey: Respondent households were identified using landline and mobile phone numbers randomly

selected from a large database of known numbers (by DataZoo). Landline phone numbers included listed and

unlisted numbers. In the 2018 New Zealand Census, 62.5% of households reported having a landline. This was

likely to be lower in rental housing and would have declined considerably between 2018 and 2021. Therefore

respondents were also contacted on their mobile phones using randomly selected mobile phone numbers.

Contact and interviewing were undertaken using an in-house Computer Assisted Telephone Interviewing

(CATI) system. Trained interviewers coded respondents’ answers directly into a computer. A high level of

quality control, essential for the collection of comparative data, can be achieved using this system.

On first contact the interviewer checked whether the household owned and rented out accommodation. Such

households were classed as landlord households and invited to take part in the landlords’ survey. If they were

not landlord households, the interviewer then asked, “Could you please tell me if you pay rent where you

live?" If the answer was ‘yes’ the interviewer then ascertained if the person they were speaking to was either

the person responsible for paying the rent or their partner, and therefore eligible to answer the survey

questions. They were then invited to participate in the tenants’ survey. The CATI Tenants’ survey commenced

in July 2021. When terminated in August 2021, 128 interviews had been completed, 59 via landline and 69 via

mobile phone.

With the termination of the CATI survey due to COVID restrictions, alternative methods for recruiting tenants

were explored. Kantar Research were chosen to complete the survey as they were able to recruit an adequate

number of tenants in Auckland, Wellington, Christchurch and Dunedin using an online format with a survey

panel. Survey item wording remained the same but a number of items were cut to reduce the overall length of

the survey for delivery online.

Not all responses contained complete information. In the results reported the percentages are calculated from

those who gave valid responses. The number of total responses is also given.

The surveys were carried out between July and September 2021.

Component 2: Landlord Survey

On first contact the interviewer checked whether the household owned and rented out accommodation. Such

households were classed as landlord households and invited to take part in the landlords’ survey.

The 420 landlords surveyed included individuals who either currently owned rental property or had done so in

the last two years. The eight landlords who had owned property in the past two years but not at the time of

interview were asked about their reasons for leaving the sector.

Of the landlord respondents, 188 were contacted via landline phones and 232 on mobile phones.

Component 3: In-depth interviews

To gain a more nuanced understanding of survey data, survey respondents were asked if they would be willing

to participate in a follow-up interview. Of the CATI respondents, 66% of the tenants and 70% of the landlords

agreed to be re-contacted – very similar figures to the 2015 survey (68% and 70% respectively). Follow-up in-

depth interviews were completed with 40 tenants (27 in Auckland, 4 in Christchurch, 6 in Wellington, and 3 in

Dunedin) and 34 landlords (Auckland 17, Christchurch 5, Wellington 7, and 5 in Dunedin).

Case frames were established to capture a diversity of rental property situations in Auckland, Christchurch,

Wellington, and Dunedin. Categories for the tenant sample included younger and older adults and those with

children. The tenants interviewed had rented for between six months and 45 years. For the landlord sample

categories included number of years they had owned rental property, number of rental properties owned and

types of dwellings. Among the landlords interviewed, the length of time they had owned rental property

ranged from one year to 45 years and the number of rental properties from one to 12. All the follow-up

interviews with the 40 tenants and 34 landlords were conducted by telephone using a semi-structured

interview schedule. Interviews were conducted between August and November 2021. They were digitally

recorded and transcribed. A thematic coding frame was created following multiple readings of transcripts by

three members of the research team and the interviews coded using NVivo10. Thematic analyses were

undertaken separately for the tenant and landlord data.

Results

Section 1: Survey and in-depth interviews with tenants

Demographic characteristics of the tenant survey sample are provided first, followed by survey data and

qualitative findings presented under thematic headings. As noted above, of the 812 tenants surveyed, 128

were recruited via CATI and 684 through an online survey. Data from both tenant groups have been combined

in the analyses reported. The tenants recruited for the in-depth interviews came from the CATI sample only.

Not all survey respondents provided complete information. Where percentages are reported they are

calculated from those who gave valid responses to an item. The number of valid responses is given where

tables are included. Differences between the cities, if statistically significant, are noted.

When excerpts from in-depth interviews with tenants are included in the text, the name given is a pseudonym,

age is indicated, and city of residence is denoted by ‘AKL’ for Auckland; ‘CHC’ for Christchurch; ‘DUN’ for

Dunedin; and ‘WGL’ for Wellington.

Demographic and socio-economic characteristics of the tenant sample

Age data were reported by 798 tenants. Their mean age was 43 years, and a quarter of tenants were aged over

53 years. The Dunedin sample (mean age 36) were younger than respondents in the other cities, no doubt

reflecting the large student population in the city. Females made up 52% of the sample. Over half the tenants

were living with a partner (53.5%), 35.3% were single and the remainder reported they had a partner they did

not live with or had previously lived with a partner.

Fifty-nine percent of respondents lived in Auckland, 15.2% in Christchurch, 14.3% in Wellington and 8.5% in

Dunedin. A small number living in surrounding regions were excluded from the analyses. Tenants in the

Auckland sample were recruited from across the city: 36.2% were living in the central suburbs, 21.1% on the

North Shore, 16.2% in West Auckland, 15.1% in South Auckland and 11.4% in East Auckland

The ethnicity breakdown (allowing for multiple ethnicities) of tenants was as follows: European 66%, Māori

10.5%, Pacific 8%, Asian (including South Asian) 20% and other 3% (Table 1). Samoan was the largest ethnic

group within the Pacific category and Chinese, followed by Indian, comprised the largest groups within the

Asian category.

TABLE 1: ETHNICITY OF TENANT SAMPLE

Ethnicity

percent

European

521

66.0

Asian

156

19.7

Māori

10.5

Pacific

7.7

Other

3.2

Two thirds of respondents were born in New Zealand, but this rate differed across the cities (Table 2).

TABLE 2: NEW ZEALAND BORN BY CITY – TENANTS

Auckland

Christchurch

Dunedin

Wellington

Yes

249 (55.2%)

89 (80.9%)

57 (90.5%)

85 (78.0%)

202 (44.8%)

21 (19.1%)

6 (9.5%)

24 (22.0%)

Total

451 (100.0%)

110 (100.0%)

63 (100.0%)

109 (100.0%)

Most respondents were in paid employment (72%), although this also varied by city, from 51% in Dunedin,

through 60% in Christchurch to 67% in Wellington and 79% in Auckland (Table 3). Over the 12 months, prior to

the survey, across the four cities, 11% had been self-employed, welfare payments had been received by 16%,

superannuation by 9% and interest/or other investment income by 16%.

TABLE 3: ALL SOURCES OF INCOME RECEIVED BY TENANTS IN PREVIOUS 12 MONTHS BY CITY

Sources of income

Auckland

Christchurch

Dunedin

Wellington

Wages, salary, commissions, bonuses, etc., paid

by my employer

344(76.1%)

67 (60.9%)

43(68.3%)

76 (69.1%)

Self-employment, or business I own and work in

(other than residential rental property)

50 (11.1%)

11 (10.0%)

12(19.0%)

11 (10.0%)

Interest, dividends, other investments

78 (17.3%)

13 (11.8%)

9 (14.3%)

18 (16.4%)

Rent

21 (4.6%)

1 (0.9%)

1 (1.6%)

5 (4.5%)

Regular payments from ACC or a private work

accident insurer

3 (0.7%)

2 (1.8%)

2 (3.2%)

1 (0.9%)

New Zealand Superannuation or Veteran's Pension

34 (7.5%)

14 (12.7%)

3 (4.8%)

16 (14.5%)

Other superannuation, pensions or annuities (other

than NZ Superannuation, Veteran's pension or war

pensions)

6 (1.3%)

4 (3.6%)

0 (0.0%)

3 (2.7%)

Welfare benefits (unemployment, sickness, domestic

purposes, invalids benefits combined)

51 (11.3%)

28 (25.5%)

18 28.6%)

18 (16.4%)

Accommodation Supplement

41 (9.1%)

15 (13.6%)

7 (11.1%)

12 (10.9%)

Other sources of income, counting support payments

from people who do not live in my household

16 (3.5%)

2 (1.8%)

3 (4.8%)

2 (1.8%)

Household income was reported in bands only: 17% reported a household income below $40,000 and 43% a

household income below $70,000. Household income of over $100,000 was reported by 35% of the tenants.

Variation in tenant household income by city is presented in Table 4.

TABLE 4: HOUSEHOLD INCOME BY CITY – TENANTS

Household income

Auckland

Christchurch

Dunedin

Wellington

Less than $70,001

151 (39.4%)

46 (51.7%)

29 (58.0%)

27 (31.4%)

$70,001 or more

232 (60.6%)

43 (48.3%)

21 (42.0%)

59 (68.6%)

Total

383 (100.0%)

89 (100.0%)

50 (100.0%)

86 (100.0%)

Household size varied across the sample with 12.5% of respondents living in a single person household, 23% in

a two-person household, 20% three-person, 17% a four-person, 14% five-person households, and the

remaining 13% living in a dwelling with more than five people.

Renting pathways

Our survey data illustrate the diversity of New Zealanders’ housing pathways. Rental tenure had been a long-

term situation for many tenants, whereas others had moved into and out of home ownership. Of the tenant

survey sample, 30.5% had been homeowners, slightly less than the 36% of tenants who reported having been

homeowners in 2015. Nearly three quarters of these respondents had sold the home they owned, with the

main reason for selling being a relationship breakup (38%). This scenario was described by a number of tenants

during the in-depth interviews:

“He got the house, and I got the children.” (Cheryl, 81, CHC)

“Yes, we did. We brought up our family in our own house. We owned it for about 25 years and then we

divorced, so then I went renting.” (Jennifer, 71, WLG)

In a few cases interviewees had become renters after the death of a partner, which left them, like Eric,

struggling to afford to stay in their home, primarily due to mortgage repayments.

“I owned a house probably 20 years ago … Basically my wife died, so my first wife died, and the costs

basically blew out and we needed money, so we sold the house.” (Eric, 55, WLG)

The costs associated with raising a family was the primary reason home ownership had become unaffordable

for Cindy:

“We had our own house, but we sell it … at that time we have six kids … we [couldn’t] afford it … we

regret it sometimes because … we’re getting old…” (Cindy, 57, AKL)

With rising house prices and rents, Cindy described sometimes feeling a sense of regret at missing out on the

increase in capital value and now seemingly being locked into renting into later life. An inability to afford

mortgage repayments was reported by 16% of the tenants who had once been homeowners. For a further

11%, moving for work was the primary reason for selling. Needing money for other things such as health care

or setting up a business was also reported.

Movement between positions in the private rental market was also evident. Paul had been a homeowner and

landlord in the past but was now renting.

“…when I was married, I did have rental properties, I was a landlord. So, I've been on both sides of the

coin but … when the marriage broke up, I came back to New Zealand and I was boarding.” (Paul, 73,

AKL)

Some interviewees were renter-owners, reflecting the diversity of contemporary housing pathways. Renter-

owners are an emerging class of landlords who own a rental property but continue to be renters themselves

(Hulse & McPherson, 2014). A few of these households could be considered ‘rentvestors’, households choosing

to maximise the investment potential of their capital, while maintaining residence in a preferred location

(Morris et al., 2021). However, our interviews demonstrate the complex reasons that can lead households to

rent and own concurrently. Some of these tenants commented that they were unable to afford a home either

big enough for their family’s needs or in the location they wished to live – often to retain social connections

and/or preferred schools for their children.

“The house … we owned was simply too small for our expanding family … And because we wanted to

stay in the area … we were forced to rent if we wanted to stay. But what we then did was we bought a

property in South Auckland that we rented out.” (Jaap, 47, AKL)

Whilst investment was mentioned as a motive for the choices made by some property-owning tenants,

accommodating changing family circumstances was often a more immediate motive, as illustrated by Isabella:

“We do have a house … it's a tiny little place … too small for our family, so … [we’ll] keep renting while

we’ve got kids at home and … [when] retirement age comes … we’ve actually got somewhere to live and

not have to pay market rent.” (Isabella, 51, AKL)

Finding and securing a rental property

Around 30% of tenants reported having secured the first rental property they applied for, less than the

approximately 50% nationally who reported doing so in 2015. Rates varied between cities, with tenants in

Dunedin and Christchurch more likely to secure the first property applied for than those in Wellington or

Auckland. Nationally 26% of respondents had applied for 1 or 2 properties, 22% for 3–5, 10% for 6–10 and 9%

for more than 10 properties before securing their home (Table 30).

The more times tenants had moved in the previous five years, the more likely they were to have applied for a

higher number of dwellings prior to securing their current home (P<.001). Almost half (46.4%) the tenants who

had secured the first home they applied for had not moved in the previous five years, compared to only 22.5%

of those who had moved three or more times. Indicating a tighter rental market in 2021 compared to 2015,

both these figures were lower than the corresponding figures of 64% and 47% reported in the earlier survey.

There was no significant difference in the mean number of times tenants had moved in the last five years

between the 2015 and 2021 surveys.

The number of times tenants had moved in the previous five years was significantly related to age, with older

tenants less likely to have moved in the previous five years.

Trade Me was used by 45% of tenants to find a home and another 11% used some other online portal. Family

and friends assisted a further 25% of tenants to find homes and property managers were used by 8.5% of

respondents.

Examples of drawing on social networks to find available rental properties included getting a reference from a

friend or a recommendation from a friend of a friend. Jennifer used the community app Neighbourly when

struggling to find a place in the area she wanted to live, which triggered a response from someone she knew:

“The one I’m in now, I just got through word of mouth. I just put a little message up on Neighbourly, that

community app, and somebody that I had worked with …saw it and said, “ I know a flat that’s going

vacant.” She gave me a healthy reference, so it all just worked out fine, so that’s good.” (Jennifer, 71,

WLG)

Asked if they felt they had been unfairly turned down by a landlord, 29% of tenants said they had. Of these,

30% said they thought their ethnicity was the reason they were turned down, and 20% said it was their age,

being an older tenant. Pets (17%) and children (14%) were other factors commonly reported.

There was a statistically significant difference by ethnicity – with European (vs non-European tenants) less

likely to report discrimination (p=0.035). Also, older tenants were more likely to feel they had been unfairly

turned down than younger age groups (p=0.002).

In the in-depth interviews, finding a landlord willing to accommodate pets was mentioned more often than

discrimination based on ethnicity, having children or the tenant’s age when trying to find a home.

Allanna had both a cat and a dog and although she had found cats could be welcome, “nobody really wants to

deal with a dog” (Allanna, 32, DUN). At times she had even considered whether she would have to give up her

pets just to find a place to rent:

“It significantly lessens the amount of places we were able to go and view, so you think at that point

about … getting rid of the cat or dog because it’s really, really frustrating, but we love pets.” (Allanna,

32, DUN)

Isabella (51, AKL) and her family had a cat, so avoided applying to places that did not allow pets. However, in

her experience, landlords looking for a family as tenants tended to allow a cat. Conversely, Rosanna had

always wanted her family to have a dog, but felt it was not possible while renting because it would make

finding a place too difficult.

“I always wanted a dog, because they are such good company and my son … my family has dogs, so he

always says why can’t we have a dog, but you can’t have a dog when you’re renting, you cannot have a

pet.” (Rosanna, 46, AKL)

While she might not have been able to get a dog while renting, Rosanna added:

“We do have a bunny … [the landlords think it] lives outside all the time and only comes inside at

night, but he’s mostly an inside bunny now, we don’t tell them though … the bunny doesn’t damage

the house at all … so anyway, we do the best we can for the bunny and the bunny is for mental

health.” (Rosanna, 46, AKL)

A quarter of tenants surveyed had lived in their current home for less than a year, and just over half the

sample for less than two years (Table 5). Longer term tenancies were also represented in the data, with 12.7%

of respondents having lived in their current rental home for more than 10 years.

TABLE 5: LENGTH OF TIME AT CURRENT ADDRESS

Years at current

address

percent

Less than 1 year

184

24.6%

1 - 2 years

212

28.3%

3 - 5 years

187

25.0%

6 - 10 years

9.3%

More than 10 years

12.7%

Don’t know

0.1%

Total

749

100.0%

In terms of tenure history, 72% of tenants had moved to their current address from another private rental

property. Across the total sample, seeking better quality accommodation (17%), to be closer to work (16 %)

and the landlord having sold the property (15%) were the most frequent, and the most important reasons

given for moving. However, there were differences between the cities. Seeking better accommodation was the

most common reason given for moving by tenants in Christchurch (25%) and Dunedin (23%), whereas landlord

having sold the property and moving for work were the two most common reasons given for moving in

Auckland (17 % and 19% respectively) and in Wellington (19% and 15%).

Family and friends

In the Landlord’s section that follows, we note that landlord practices were often influenced by a desire to

accommodate family members. In keeping with these observations, several tenant interviewees had a family

member or friend as their landlord. For example, Mary was living with her partner in a house owned by her

son. She had sold her house due to the complications of reduced mobility, and had been renting for about 20

years. After being forced to move twice from rental properties, she had moved into a property owned by her

son to gain more security. Mary described the tenancy relationship with her son as follows:

“I don’t think it’s very formal, but I did tell him you’re not allowed to put the rent up! So, he was quite

happy about that” (Mary, 80, AKL).

Longer term her son planned to sell the property to pay for a place for Mary in a retirement village. As Mary

explained:

“… we are actually moving to the village, you know, old age sort of village … as soon as we get down to

Level 2” (Mary, 80, AKL).

Jaap rented a friend’s property. After a relationship breakup and the family home being sold, Jaap rented near

his children and their school in a community where he had connections. Finding an affordable place in a high-

rent area, with enough room for his children to stay, was challenging.

“Whenever there was three bedrooms … it's just out of your budget. Because you know, $1,500 a week

… for a three-bedroom … with a garden is just crazy. But people will pay it. There's nothing available

here.” (Jaap, 47, AKL)

While convenient, Jaap found it wasn’t always straightforward navigating the landlord and tenant roles with a

friend:

“They're more friends than landlords … it's always a fine line … Sometimes when you think like, hey, you

know, can you fix this? Or that you just do it yourself. Or it doesn't get fixed, because you just don't want

to be, you know, you're thankful that you that they let you in there.” (Jaap, 47, AKL)

The line between friend and landlord was not always easy to define, making Jaap hesitant to talk to his

landlord about required maintenance.

Rental housing affordability and tenure security/insecurity

Affordability was a concern expressed by many tenants, both in the survey and the follow-up interviews. Data

from the survey on rents paid by dwelling type in the four cities and tenants’ perceptions of affordability will

be presented next, followed by commentary from the tenants interviewed regarding their concerns and the

trade-offs made to remain adequately housed.

Rent was paid weekly by two thirds of tenants, fortnightly by 28% and monthly by around 5%. As expected, the

amount paid varied by city (and for Auckland, by location within the city), and by housing type (see Table 6).

The most expensive rents per dwelling were reported in Wellington (mean $617 per week) and within

Auckland, on the North Shore (mean $598). Separate houses were more costly to rent than semi-detached or

terraced houses, which were in turn more costly than flats/apartments. Three-bedroom homes were the most

common dwelling type and rented by 34% of survey respondents, followed by two-bedroom dwellings (29%),

four-bedroom dwelling (17%) and single bedroom homes (13%). Larger homes, with five or more bedrooms,

made up the remaining 6% of homes. Consistent with inter-city differences in the overall cost of rental

properties, the mean rent paid per bedroom was highest for Wellington ($258 per week), followed by

Auckland ($230), Christchurch ($158) and Dunedin ($150).

TABLE 6: TOTAL WEEKLY RENT ON PROPERTIES

City

Mean

Median

Auckland

438

$552

$528

Christchurch

113

$382

$380

Dunedin

$475

$400

Wellington

105

$618

$550

Housing type

Semi-detached or terraced house

123

$545

$500

Separate house

410

$564

$548

Single flat/apartment

165

$447

$440

Auckland locations

Central Suburbs (including CBD)

153

$554

$520

East Auckland

$567

$550

North Shore

$599

$600

South Auckland

$513

$500

West Auckland

$515

$500

Asked to self-report if their housing costs were affordable, 45.5% of tenants surveyed agreed or strongly

agreed they were affordable and 38% disagreed or strongly disagreed (Table 7).

TABLE 7: AFFORDABILITY OF HOUSING

Housing affordable

percent

Agree

246

33.3%

Disagree

178

24.1%

Don’t know

0.1%

Neither agree nor disagree

123

16.7%

Strongly agree

12.2%

Strongly disagree

100

13.6%

Total

738

100.0%

A number of tenants interviewed had their rent rise soon after the restrictions on rent increases during COVID-

19 lockdowns were removed, and when interviewed in 2021 were struggling with the increased cost. A notable

fear for older renters, as illustrated by Malcom’s comment, was that a future reduction in household income

would mean their home would become unaffordable.

“It won’t be [affordable] very shortly for us because my wife needs to cease work because of a health

condition, so we’ve been reduced to one income.” (Malcolm, 54, CHC)

Minimising costs was a key driver of housing decisions, and this included the decision to flat share. While the

social aspects of flatting were sometimes appreciated, the decision to live with flatmates was primarily a

financial one for most interviewees.

“it’s really only affordable because there is four of us, and technically speaking there is only three people

on the lease …” (Tina, 26, WLG)

Aaliyah was also flatting, and she appreciated the ability to afford to rent a “nicer” home by sharing costs with

others. For her, the social aspects of flatting were a bonus:

“If you choose the right people” but also noted “…it helps with expenses too, just general expenses

and utilities, it does make that more affordable too.” (Aaliyah, 25, AKL)

While younger renters usually accepted the need to flat, and that there were often pros and cons of doing so,

it could be more challenging for older renters. For Gregory, living with flatmates was not his first choice and he

missed having more space and privacy:

“It’s not a choice, it’s to minimise the costs, to share it … that’s why we’re in this little place here.”

(Gregory, 50, AKL)

Keeping renting costs low was part of Gregory’s plan to hopefully buy a place of his own in the future.

However, some younger renters who had been flatting for many years also mentioned they would now prefer

to find a place of their own:

“I’m just not sure in general if I would want to [live with others] … I mean if I could afford to, I would

rather live alone probably.” (Jake, 33, AKL)

Jake also clarified that “the flatmates aren’t the issue”, since he’d been living with some of them through three

different flats; it was just that now he wanted more of his own space.

The housing stock available for rent was another reason given for flatting. Where predominantly larger family

houses were available, single people, including older people like Mike, said they needed to fill the bedrooms to

cover the rent:

“There is one other person [flatting here] … it’s actually a four-bedroom house but there’s only just two

of us here at the moment … I should have at least one other person here as well, because it’s quite

expensive covering the balance by myself.” (Mike, 62, AKL)

Single people who had found smaller single-bedroom units had sometimes made trade-offs around the quality

of their home to avoid flatting with other people. For example, Larry was not really happy with where he lived,

because it was a “pretty small” studio unit in a block of flats. However, when asked whether he’d considered

moving somewhere else, he stated:

“No, not really, I don’t want to live with other people, and I can’t afford the outrageous rental prices for

like a three-bedroom house or anything and anything smaller than a three-bedroom house, you’re

usually living in a complex with other people.” (Larry, 50, WLG)

His small studio unit offered him some of the privacy and independence he desired but was far from ideal for

him. As he mentioned, “You don’t find detached one-bedroom places, so it would have to be a unit of some

kind or a flat complex, I mean all I can do here is keep to myself.”

Reducing monthly bills, in particular reducing power costs by not turning on electric heaters and wearing more

clothes or a blanket, was discussed. For example, Diana was happy her house was relatively warm and dry in

winter, and she was able to reduce costs by not using any heaters most of the time.

“…I just go to bed and put a blanket on to be honest. I’m not heating up the whole room just for me … I

think I only put the heater on two nights … I only get cold at the beginning of winter … then I get used to

it.” (Diana, 51, AKL)

For more financially secure renters, as mentioned earlier, higher housing costs could be a trade-off with living

in desirable and familiar neighbourhoods. Julie had previously owned a home, but the house was sold after the

breakdown of her marriage, leaving her with some equity from the house, but not enough to purchase a house

near her children’s school and friends.

“It depends how you justify the word affordable … at the moment I am probably exceeding what I earn

each month … because I went for a particular location that is expensive yeah, I would say it’s probably

not that affordable, no, I just made that sacrifice … [to be] in a location that’s near their schools and

near their friends … being walking distance to school was a really big thing.” (Julie, 48 AKL)

Julie’s story was not uncommon, with several other interviewees discussing how they had previously been a

homeowner, but had entered the private rental sector after the breakdown of their marriage, unable to afford

to buy a home in a location where they had existing connections.

Returning to the survey data, regarding the adequacy of their current rental accommodation in terms of

meeting household’s needs, most tenants (82%) surveyed said their household’s needs were being met. Of the

16% who reported their needs were not being met, the most frequently listed reasons were that the dwelling

was too small, too expensive, in need of maintenance or repairs and/or unhealthy/damp (Table 53). A similarly

high percentage agreed (46%) or strongly agreed (36%) that the general area or neighbourhood of their home

suited their needs and those of others in their household. Only 8% of tenants indicated the neighbourhood

was unsuitable, with the remaining respondents neither agreeing nor disagreeing.

In keeping with tenants’ accounts in 2015, many of the tenants interviewed in 2021 expressed gratitude,

saying they felt ‘lucky’ to be in their rental. While they believed the cost of renting was in general too high and

that people were struggling, they felt relatively secure in their home. For example, Louise, who had been in the

same home for seven years, commented:

“I feel myself as lucky and grateful … [the rent] is slightly cheaper than market value … because I’ve lived

here since 2014, which is basically when you know, rents and all that sort of thing started to get

outrageous.” (Louise, 47, WLG)

This feeling of being lucky sometimes had a flip side of feeling nervous that if they ever had to move, they

would face a significant increase in housing costs.

After having been forced to move house several times while raising her son, Rosanna felt ‘lucky’ to have found

stability in a house they could afford in a neighbourhood their family loved.

“We’ve been so lucky, I can’t believe it’s been this long … and we pay so little compared to houses in the

same street … it’s a full section and the house is really old, [the landlord’s] done nothing to the house … I

don’t really complain because I’m happy, I don’t want to move, I love it.” (Rosanna, 46, AKL)

However, alongside that emotional connection to her house and the stability and happiness it had brought

her, she was also nervous each time the yearly lease comes up for renewal, explaining:

“Every December I get nervous because I don’t know if they’re going to let me [stay another year] …

but we’ve been so lucky, I can’t believe it’s been this long, and I feel that I don’t want to jinx it.”

(Rosanna, 46, AKL)

The stability and affordability have not been without costs however, as the house has been a challenge to

maintain for Rosanna:

“…it is drafty, they’ve complied with regulations now, because it is quite damp, I always have to clean

the walls often, because they get really mouldy, but it’s a roof and it’s a house and it’s a place and it’s a

neighbourhood and I know my neighbours they’ve been here for so long, I don’t want to move.”

(Rosanna, 46, AKL).

A trade-off is evident here: not wanting to ‘jinx it’ and risk ending the tenancy had meant enduring a home

that likely falls short of being a warm, dry and well-ventilated. This type of trade-off was not uncommon, and

tenants’ views of their situation were influenced by their financial position, the rental sum, and their

perception of the fairness of the rent they were being charged. Among tenants on a tight budget, there was a

sentiment of not rocking the boat during a tenancy when they felt they were paying below market rates,

especially if they had been in the dwelling for some time.

“The bathroom was yellow and turning to brown and … [the landlord] said, we must get this painted and

… a tradie turned up and [said] … we must do something about that … but never got around to it. It

didn’t worry me, cos it was low rent and that. You don’t shake the tree when you don’t want the apples

to fall off.” (Paul, 73, AKL)

Peter had been renting his house in Dunedin for over 20 years. His arrangement with the landlord was not

based on a tenancy agreement and the condition of the house was poor, with no insulation and minimal

heating. However, Peter was reticent to complain about his home of two decades and instead emphasised

how comfortable he was there. When asked whether he informed the landlord when something needed fixing,

he stated:

“Not necessarily, it’s a kind of a trade-off … I haven't expected landlords to instantly do something to fix

a place. I mean, I have probably always chosen places that are derelict … [and] don't meet all the

requirements of a proper rental … in return for a cheaper rent. On that basis, I don't bother the landlord

with minor things that go wrong.” (Peter, 71, DUN)

Peter was competent to undertake repairs and gardening and had mostly looked after the house himself

without contacting the landlord, a practice that seemed to be satisfactory to both parties as his rent had

remained low.

Deferring maintenance requests and avoiding discussing issues with a rental property landlord were not

limited to those living in lower-rent areas. As discussed above, Jaap who was renting from friends in a high-

rent area of Auckland was wary of bringing up issues, wanting to avoid trouble:

“If you get a really good deal … you just don't bring it up … [The] house was quite cold and there was

stuff that had to happen. But you don't bring it up because you know, you get a very very very good

deal on it.” (Jaap, 47, AKL)

As discussed later, this maintenance/rent trade-off situation appeared more common with tenants who dealt

directly with a landlord rather than a property manager. However, many tenants preferred dealing directly

with a landlord and many talked of the positive relationships they had developed by doing so.

Tenancies arrangements and experiences

Most tenants (88%) had signed a tenancy agreement and 87% had paid a bond on the property; figures that

are very similar to the 91% and 89% respectively reported in 2015. The 67.5% of tenants who knew their bond

had been lodged with Tenancy Services was also comparable to 2015. Of the remaining tenants in 2021, 29%

did not know if their bond had been lodged and 3.4% reported the landlord or property manager had not

lodged their bond. Tenants were also asked if they had negotiated a fixed-term tenancy with their landlord or

property manager: 45% of tenants reported they had while 54% had not.

Of the surveyed tenants, 64% paid rent directly to a landlord (including to a trust or family member) and 35%

paid rent to a property manager. These figures were consistent across the cities. Nationally, tenants who paid

rent directly to a property manager paid $50 more per week on average than those who paid rent to a

landlord, $560 compared to $510 per week. This may be attributable to factors other than tenancy

management such as dwelling size, location or condition.

Smoke alarms were reported as installed in 93% of rental properties and absent in 6% of homes. Although

tenancy agreements record the nature of insulation in a dwelling, many tenants said they did not know if

underfloor and above ceiling insulation had been installed, with 60% indicating it had been, 6% that it hadn’t

while 18% did not know.

A high percentage of tenants (76%) said they had contacted their landlord or property management company

concerning maintenance on the property. The most common maintenance issues reported were minor

plumbing repairs (e.g., leaky taps, faulty hot water), which made up 28.5% of call outs, and electrical repairs

(e.g., lighting, ventilation/heating systems), a further 17%. This was followed by leaks and major plumbing

events, which each made up 9% of reported events. The remaining maintenance concerns were wide ranging

and included improving security, attending to mould, weather-related repairs, whiteware repair and

replacement, and maintenance of outdoor features such as fences, guttering and trees.

TABLE 8: DAYS TAKEN FOR MAINTENANCE REQUEST TO BE RESOLVED

Days

percent

1.6%

19.4%

19.6%

3 - 5

20.1%

6 - 10

13.3%

11 - 15

7.5%

16 - 30

8.9%

31+

9.6%

Total

428

100.0%

Table 8 records the number of days taken to have the repair or maintenance issue fixed or resolved. Sixty

percent of issues were resolved within five days, 21% between 6 and 15 days and 18.5% took 16 days or longer

to be resolved. When asked how satisfied or dissatisfied they had been with the maintenance service provided

by the landlord or property manager, 39.6% of tenants had been satisfied and 29.5% very satisfied. Of the

remaining tenants, 7.3% said they had been dissatisfied and 4.9% had been very dissatisfied. Satisfaction was

slightly higher for tenants who dealt directly with a landlord (Table 9). Of these tenants, 33% reported being

very satisfied with the maintenance service provided by their landlord and 38.5% were satisfied. For the

services provided by property managers, 22.7% of tenants reported that they were very satisfied and 42%

were satisfied.

TABLE 9: SATISFACTION/DISSATISFACTION WITH MAINTENANCE OF PROPERTY

Satisfaction with maintenance

Landlord (including trust)

Property management company

Very dissatisfied

18 (3.8%)

16 (6.2%)

Dissatisfied

40 (8.5%)

14 (5.5%)

Neither satisfied nor dissatisfied

73 (15.5%)

58 (22.7%)

Satisfied

181 (38.5%)

108 (42.2%)

Very satisfied

155 (33.0%)

58 (22.7%)

Don’t know

3 (0.6%)

2 (0.8%)

Total

470 (100.0%)

256 (100.0%)

Table 10 records tenants’ responses when asked, “If the landlord was to spend $10,000 on improving your

home, what would you most like them to spend the money on?” Various improvements were mentioned, with

kitchen improvements (13.9%) and insulation (12.9%) the most frequent, followed by heating and

maintenance improvements, both reported by 11.8% of the sample. These responses differ to those reported

in response to the same question in the 2015 tenants’ survey when insulation (26%) and heating (14%) were

the priorities for capital spending. In the earlier survey, kitchen improvements were the third-ranked

improvement sought by 9% of tenants. It is likely that these changing priorities reflect the impacts of the

introduction of the Healthy Homes Act, which requires landlords to install heating and upgrade insulation

standards.

TABLE 10: PRIORITIES FOR EXPENDITURE ON PROPERTY IMPROVEMENTS

Priority for dwelling improvements

percent

Kitchen (including new appliances)

102

13.9%

Insulation

12.9%

Heating

11.8%

Maintenance improvements (electrical faults, leaks, repainting, broken windows/walls etc.)

11.8%

Bathroom

11.3%

No improvement necessary

8.2%

External improvements (e.g., landscaping, decking, fencing, etc.)

6.1%

Redecorating

6.0%

Ventilation

3.8%

No preference

3.4%

Improving security (e.g., locks and doors)

3.3%

None of the above

3.1%

Don’t know

2.6%

Drainage

1.8%

Total

735

100.0%

Tenant, landlord and property manager relationships

Accounts of having a good tenancy relationship were common amongst tenants, especially among those who

dealt with their landlords directly. Having a positive relationship could increase feelings of security and a

willingness to invest in making the house feel like home. Denise and Eric’s accounts are illustrative.

“Actually, we have had a good relationship with [the landlord] … They’ve been really nice people and

yeah, definitely. We've just been incredibly lucky, I think because I've heard some horror stories from

other people.” (Denise, 50, AKL)

Eric felt he was lucky to have a good relationship with his landlord, but that it worked both ways, as he

considered he’d also been a good tenant.

“In some ways I think I’ve been quite lucky, you know where I think we’re good tenants and resultantly

the relationship with the landlords has been good.” (Eric, 55, WLG)

After 10 years living in the same property, with the same landlord, there was considerable trust between Eric

and his landlord. A more formal arrangement, if it had existed, had seemingly been replaced by a relationship

based primarily on trust.

“So, basically … I’m not sure, it’s been a while since I’ve seen it [tenancy agreement], so it’s basically, I

would say more a gentleman’s agreement, dare I say it.” (Eric, 55, WLG)

Although most tenants had signed tenancy agreements, Eric’s situation was not unique.

Gail had been renting the same house for 35 years and had “outlived the original landlord”, with the landlord’s

daughter now managing the property. Having lived in the house for so long, she felt comfortable and had

made the place feel like her own. A key aspect was the good relationship she had with her landlord:

“I deal with the daughter now. We have a very nice relationship I feel. I don’t ask her much and that

makes her happy … I wouldn’t say she’s like a mate, but we do have a really good relationship and as

time goes on, we’re very comfortable with each other.” (Gail, 69, AKL)

Gail had only recently asked for and signed a tenancy agreement with her new landlord. She had not had one

previously; as she said, those were “different times”.

However, as discussed earlier, having a direct relationship with a landlord, especially if the rent was low, could

contribute to a tenant being reticent about asking for repairs and maintenance, and a fear that asking for too

much, too often might see their rent increase. Also, a good relationship does not safeguard a tenancy if there

is a change in property ownership or change in management approach. While a change in ownership had thus

far worked well for Gail, the change in Paul’s situation after a similarly favourable long-term relationship had

not.

Paul had rented a unit from the same landlord for many years, in a low rent, poor maintenance situation.

However, feeling less and less able to manage the property, the landlord eventually employed the services of a

management agency. Paul recounted that one of the first actions made under management by the agency was

to raise the rents: “…the moment the agent came into it, our [weekly] rent … went from $180 up to $400 very

quickly once the agency took over” (Paul, 73, AKL). A longstanding relationship dissolved into a more distanced,

‘hands-off’ approach with ‘market’ rents. It was now difficult for Paul to afford the increased rate and an

equilibrium he had been comfortable with was seemingly disrupted.

Tenants reported varied experiences with property managers. The advantages most commonly stated were

that agencies offered more certainty and consistency. The relationship was primarily a professional one, in

which inspections were scheduled and maintenance issues could be raised and attended to.

Although experiences varied widely, tenants with property managers were less likely to feel they had freedom

to personalise the property and make it feel like home than those renting directly from a landlord. One partial

explanation could be that being less familiar with the owner, they were unable to develop a relationship,

which, as discussed above, had enabled some tenants to feel more secure in their rental home. Diana (51, AKL)

commented that while she understood “that if you have tenants trashing the place, you’d probably want to

know sooner or later”, she found inspections were a regular reminder that someone else owned her home.

However, the diversity of tenant experiences is illustrated by Mary’s account of experiences with a property

management agency.

“The agent used to come around every six months but he … said well it looks clean … and he didn’t even

bother going round the rest of the place … he just took it for granted that it would be the same in the

other rooms, which it was basically.” (Mary, 80, AKL)

In the last few years before the owner sold the property and Mary had to move, the inspections ceased,

seemingly because she had “kept it reasonably well” during that time so “they didn’t bother” coming anymore.

This level of trust and hands-off management approach helped Mary to feel more at home in this house

compared to some others she had rented.

The observation that there are good property managers and poor property managers was made by tenants

and landlords alike. Contrasting experiences of property managers are shared by Larry and Tina in the

following excerpts. One of the reasons Larry was unhappy with the unit in which he lived was the property

management agency for the apartment building:

“[The] property manager … is another reason to get out of here … they’re not very good … [there are]

very long wait times to get things fixed, for instance, a simple leaky tap I’ve got, it’s been almost a year

since I first reported it, it still hasn’t been fixed.” (Larry, 50, WLG)

On the other hand, Tina, had only good things to say about the agency managing the standalone house she

rented:

“[The] property management company … are actually really nice and efficient, which is great …

everything is pretty good, to be fair.” (Tina, 26, WLG)

Having rented in several different countries, Allanna had considerable experience being a tenant and, for a

while, was a landlord as well. She discussed how after previous encounters with an unresponsive landlord with

whom she had had serious disagreements, she now actively sought out rental properties that were managed

by companies. She felt dealing with a property management company more formally demarcated the tenant–

landlord relationship and that this made both parties more accountable and aware of their expectations and

responsibilities.

Other interviewees also appreciated the formal arrangement of having a property manager. For example,

Gabriella who had been renting with her family for five years, and had had to moved three times in that period

commented:

“Well, a property manager is definitely far more by the book … for example, when we renewed our lease

here, they … [got] a Healthy Homes person in to make sure if any improvements needed to be done …

likewise when there has been any minor issues or repairs or maintenance that needed to be done that

was done, so that’s a good thing.” (Gabriella, 29, AKL)

Along with inspections to ensure the property complied with healthy home standards and prompt

maintenance work, Gabriella also felt more secure in this home. However, she resented the incremental rent

creep she had experienced when dealing with property managers and lack of empathy for the stress this

placed on tenants.

Private landlords who managed their own properties were also often highly responsive to tenant needs.

Isabella had a very positive experience with her previous landlord, who had managed the property himself:

“That was all down to the owner…. he was very responsive … When things went wrong, he'd get them

fixed straight away. It was simple.” (Isabella, 51, AKL)

Her previous experience with an agency was more frustrating, especially due to the time it took for

maintenance issues to be fixed. Her landlords were living overseas and she believed this delayed the process.

“With the rental agencies … when something goes wrong, for example, the insinkerator dies or the

garage door dies or something like that, you phone up the real estate agency … they’ve got to go to the

owner overseas and it takes ages to get it [fixed] … offshore owners tend to be slow to respond.”

(Isabella, 51, AKL)

Isabella also said she felt agencies were particularly strict on what she could and could not do in the house,

and noted comments made by the agency on whether she was allowed to wear shoes inside her house:

“I think one of the hardest ones we had to deal with… cos they're just so pro- owner … not so great for

the tenant … almost to the point … [that] they were telling us … not to wear shoes inside our own

house.” (Isabella, 51, AKL)

Although the survey data indicates reasonably favourable tenant perceptions of their rental experiences

overall, the qualitative interview data highlights enormous variation in tenants’ experiences, both from tenant

to tenant, and from tenancy to tenancy for individuals. Achieving a satisfactory, secure, and healthy home

often required negotiation and compromise. Substandard conditions or tardy maintenance were tolerated for

fear that rocking the boat could risk the tenancy or lead to a rent increase. For some tenants this was a

compromise they made to retain the stability of home and school and neighbourhood connections. Other

tenants accepted regular inspections were part of a rental agreement while also being a reminder that they

were temporary residents of a property belonging to someone else. The possibility of housing uncertainty in

the future kept the ideal, and for some the possibility of home ownership alive.

Seeking tenancy advice

Survey respondents were asked where they would go for help or advice if they had problems with their

landlord or property manager. Over half (54%) said they would go to the Tenancy Tribunal. Similar numbers

identified Citizens Advice Bureau (25%), friends and family (24%), and a tenant protection association (21%) as

sources of advice. A lawyer or community law centre was also mentioned by 14% of tenants.

Of the tenants interviewed, only one reported having taken a complaint to the Tenancy Tribunal. Although

they won the case, they found it a stressful and time-consuming process.

“I had a really terrible experience with the previous property manager … they tried to withhold… well,

they did withhold the bond from us when we left because they said we didn’t leave it tidy enough and

we took them to the Tribunal … It took months to even get to the Tribunal and then like another

couple of months to get the bond refunded once the Court decided that obviously we had left it in a

perfectly fine state and the property manager had nothing, you know, no claim to it, and that was like

hugely stressful and a long drawn out ordeal … [just] because it is literally their job as a property

manager to do that, to try and get more money out of us.” (Jake, 43, AKL)

Other tenants’ comments indicated a reluctance to report a situation to the Tenancy Tribunal, reflecting an

enduring sense of lacking power in the tenant–landlords/property manager relationship, and that making a

complaint would inevitability leave them in an even less advantageous position.

“If we go to Tenancy Tribunal over it, they’ll kick us out…. we put up with a lot more crap than they

think we do.” (Fiona, 29, AKL)

“Yeah, it’s likely if I went to the Tenancy Tribunal, they’d make things difficult … Like my rent going up

large amounts, I’d start failing property inspections and so on.” (Larry, 50, WLG)

Fiona and Larry both feared reprisals if they complained about their rental situation.

Heath and disability

A survey question asked tenants if they had ever asked a landlord or property manager to modify a rented

property to help them manage a disability, an important question given that 20–25 % of New Zealanders,

depending on the definition, have a disability (Stats NZ, 2014). Only 7% of tenants said they had asked. Of

these 58% indicated the requested modification was made and 37% said it had not been made. Common

modifications made were installing ramps (47%) and handrails (47%).

A question was asked of both tenants and landlords was whether they thought there was a link between

someone’s housing and their health. Of the tenant sample, 83% said yes, 10% said no and 7% said they did not

know.

The current shortage of housing is likely to have contributed to household overcrowding. As an indicator of the

adequacy of the number of bedrooms for those living in the dwelling, tenants were also asked if anyone in

their household regularly slept in a space other than a bedroom, with 10.5% of respondents indicating that

they did.

Intentions/expectations for the future

When asked, about future housing plans, 47% of tenants said they were planning to move within the next two

years, 32% said they were not planning to move and 21% did not know. When those who intended moving

were asked about the type of property they would move to, 40.5% said to alternative rental accommodation

and 43% said to buy a property of their own. Others, while planning to move, were uncertain about the type of

housing they would move to, and 16 tenants intended moving to a property they currently owned. To own

their own home was a ‘key’ reason for wanting to move in the next two years for a third of those who said

they intended moving, with other frequent responses being to secure larger (14%) or better accommodation

(10%).

In keeping with the survey data, buying a house was a longer-term aspiration for many of the tenants

interviewed. However, with high rents it was very difficult to save a deposit for a house. Louise felt that she

was paying below market rent for her home. Even so, despite her desire to own a home, she could not imagine

affording a house in the future.

“[I’m] not even thinking about buying a house, even just … paying the rent, that’s just outrageous.”

(Louise, 47, WLG)

Eric, who had once owned his own home, hoped to do so again but recognised that to do so would be

challenging.

“I’m approaching retirement… a million-dollar mortgage or a million-dollar home, which is sort of

getting close to the standard, that seems to be something that’s unattainable.” (Eric, 55, WLG)

Tenants were asked whether their household was managing to save or invest money at the time of the survey

and if so, the type of savings/investments. Similar numbers were saving as not saving or investing – 46% and

47% respectively, with 7% responding they did not know. Three quarters of the tenants had joined Kiwisaver.

Of these individuals 50% said they planned to withdraw their contributions to buy a home sometime in the

future. Of the remaining tenants, 36% did not intend to use Kiwisaver funds for purchasing a home and 14%

were uncertain. The final question relating to tenants’ financial situation asked if they thought a family

member could give them financial help if they were planning to buy a house. Of the 735 tenants asked, 30 %

indicated a family member could help, 57% said no, and the remainder did not know.

Reflections on renting

Tenure security and feeling at home in rental housing

Tenants discussed varying ways they had established or felt hampered in establishing a sense of home in rental

accommodation. For some a sense of home came from a strong connection to their local community and

neighbourhood and not from the house they were renting.

“Every time I’ve shifted, I’ve always stayed in the same area … All my family live around … I don’t have

an emotional connection to this house though. It’s not mine. I could move out of it tomorrow and it

wouldn’t stress me. I think if you own a house, you’ve probably got more of an emotional connection to

it. But I do for the area. The area completely. I’ve grown up here all my life, my work is here, my family’s

here, my daughter’s here.” (Diana, 51, AKL)

Her minimal connection to the dwelling did not diminish Diana’s connection to the local community. However,

other tenants said it was difficult to feel at home in their dwellings without the security of owning the

property. This viewpoint was particularly common amongst interviewees who had previously been

homeowners.

“You feel insecure in a rental place, obviously because you can get chucked out at any time … you can’t

sort of make a fantastic garden or something like that, you just have to do as your told really.” (Mary,

80, AKL)

Others again indicated they felt at home and secure in their rental housing. Notably this was often tenants

who had been living in the same place for a long time. An important part of feeling more at home over time

was having the chance to invest in personalising their rental through activities like decorating and gardening.

Some interviewees stated they could almost forget they did not in fact own the house. Having been in the

house for so long, Gail felt very much at home where she lived – her garden was a particular source of

happiness.

“It’s not big, but here I am sitting in the sun, surrounded by all my pot plants, and over 35 years I’ve

hardly planted anything in the ground, it’s all in pots, so it’s lovely. It’s home, you know what I mean?

It’s like now it’s home.” (Gail, 69, AKL)

While aware she did not own the property, after living there so long, investing in personalising the house and

having developed a good relationship with her landlord, she felt a high level of tenure security:

“Even though I don’t really own it … in a sense, I feel that my landlady’s never going to throw me out.”

(Gail, 69, AKL)

Renting during COVID-19

Tenants and landlords were asked about the impact of the COVID pandemic and lockdowns on their

experiences of the private rental sector, with most tenants reporting there had been little impact.

However, a few tenants mentioned being upset that their landlords had increased the rent (as the legal

framework at the time allowed), soon after the government’s rent freeze was lifted. Diana relayed how her

landlord temporarily lowered her rent during the first lockdown but increased it soon after a subsequent

lockdown.

“The first lockdown, the landlord actually put the rent down by $30 a week or something just to get over

the lockdown. He hasn’t done it this time, and this is a longer one … [but after] he put it down … then he

put it way up and you’re like, whoa.” (Diana, 51, AKL)

Other tenants shared similar accounts of rent hikes after the lockdown rent freeze had ended. For example,

Allanna mentioned that:

“[Once] the rental freeze had been lifted [the landlord] felt it was fine to charge more … it went up so

much. I do wonder if she felt like, ‘oh I wasn’t able to raise it before, so I’m going to really raise it now’.

So, I don’t know if that was the intention of what the rental freeze was but, yeah, we were … definitely

Covid impacted.” (Allanna, 32, DUN)

Conversely, Allanna, also reported that she was “stunned” by the kindness of their landlord who had arranged

a “fresh food box” to be delivered at the beginning of the first lockdown:

“They sent like a little note … saying that we’re in lockdown too and just thinking of you, it really just,

it was very touching.” (Allanna, 32, DUN)

A few tenants mentioned that their work had been impacted by COVID. However, they had mostly not

approached their landlords for any sort of rent reduction.

“We didn’t ask for a discount or anything … we’re both in an industry that COVID did affect us, but we

were lucky … to be covered by the wage subsidy, but I mean, yeah, we … didn’t request anything, so

everything sort of just continued as normal.” (Gabriella, 29, AKL)

Another tenant was unaware of the rent freeze and reported struggling to cover the rent, which the landlord

had put up around the time of the lockdowns:

“During the COVID, the rent went up … I don’t know about the rent freeze, I didn’t hear of that …

people increased the rent, the house owners.” (Marjan, 44, DUN)

Tenants who had worked from home during lockdowns talked of making do by creating small office spaces

wherever they could.

“We’ve been fine … we just work from home, one of us just works in the girl’s room and I work on the

kitchen bench. We can, if we needed to … one of us could go down [to the garage] … and work down

there, so we’re actually, I think very lucky.” (Nicola, 47, AKL)

Flatting situations could be challenging during lockdowns, due to less personal space with all the flatmates at

home.

A reduction in property inspections was another COVID impact. Some landlords occasionally kept in touch with

tenants, but property management agencies reportedly took a more proactive approach to meeting their

obligations, including video link inspections. However, the legality of requiring a video inspection was not clear

and, according to Harata’s experience (below), requests were ignored by some tenants:

“COVID cut everything down so they were saying we’ll do a video link inspection but apparently that is a

grey line that we can refuse doing a video … inspection. We didn’t do it anyway. A lot of people ignore

it.” (Harata, 68, AKL)

A couple of interviewees recounted the challenge of needing to find a new home to rent around the time of a

lockdown. Isabella explained:

“I was really lucky, because [at level three] we were … pretty much squabbling over the same

properties … [with] everybody else who was in the same boat as us. We were seeing the same people

over and over again. Some of them had little kids and I was thinking, you poor buggers, it’ll be hard for

you guys.” (Isabella,51,AKL)

Few houses were advertised as available to rent during the lockdowns, which contributed to the stress and

uncertainty of seeking a new home.

Section 2: Survey and In-depth interviews with landlords

The section begins with a description of the demographic characteristics of the landlord sample followed by

relevant survey data and qualitative findings presented under thematic headings. The survey gathered data

from 420 landlords, including eight who had been landlords in the past two years but were not at the time of

interview. Prior landlords were included so that reasons for exiting the sector in 2021 could be compared to

data gathered from this group in 2015. Of the landlords, 257 were from Auckland, 63 from Wellington, 71 from

Christchurch, and 20 from Dunedin. In the results reported below, where there were missing data for specific

questions, the percentages were calculated only from those who gave valid responses. Where significant

differences between the cities were observed in either the survey data or follow-up interviews, these are

noted. Excerpts from in-depth interviews with landlords are included in the text, with participants identified by

a pseudonym and their city of residence denoted by ‘AKL’ for Auckland, ‘WLG’ for Wellington, ‘CHC’ for

Christchurch and ‘DUN’ for Dunedin, and the number of rental properties they owned.

Demographic and socio-economic characteristics of the landlord sample

The median age of the 406 landlords who gave their age in the 2021 survey was 60 years, four years older than

the 2015 landlord cohort (Table 11).

TABLE 11: MEDIAN AGE OF LANDLORD SAMPLE

Year

Mean age

Median age

2015

406

55.5

2021

397

59.7

While this may suggest New Zealand has an ageing cohort of landlords – ageing four years over the past six

years – caution is needed in this interpretation as the changing balance between landlines versus cellphones in

the survey recruitment strategy may have favoured the recruitment of older respondents. The decline in

landline use has been sharp and the demographic profile of those with and without landlines at a specific point

in time is not precisely known.

Women made up 55 % of the 2021 sample and men 44.8%. Across all respondents, 69.8% identified as New

Zealand European and a further 8.3% as European. Of the remainder, Indian identity was reported by 7% of

respondents, 2.5% indicated they were Chinese and 2.5% identified with other Asian ethnic groups. Small

numbers of landlords indicated they were Māori (1.7%), Samoan (1.5%), African (0.5%) and Middle Eastern

(0.5%). The majority (70.6%) were New Zealand born and 84.2% reported living with a partner.

Of all the landlord respondents, 44.3% indicated they were in paid employment, 29.2 % were retired and a

further 20.7% reported being self-employed. Table 12 also shows small numbers of respondents in other

categories of labour market status. In keeping with the older median age of the 2021 compared to the 2015

landlord sample, the number in paid employment had declined (from 51.7% in 2015) and retirees had

increased (up from 18.5%).

TABLE 12: LANDLORD LABOUR MARKET STATUS

The median length of time respondents had been landlords was 15 years, significantly longer than the 12 years

reported by landlords in the 2015 survey. A number of respondents in both the 2015 and 2021 surveys had

been landlords for more than 40 years.

A household income of over $150,000 was reported by 39.3% of landlords. Differences were recorded

between the cities – Auckland (44%), Wellington (34%), Christchurch (30.5%) and Dunedin (25%) – but these

differences were not statistically significant. Correspondingly, an annual household income of less than

$150,000 was reported by 60.7% of the sample overall. Table 13 indicates the various sources of income

reported by landlords across the four cities in the 12 months prior to being interviewed. In addition to rent,

wages and other employment related income, superannuation and earnings from self-employment were the

most common income sources.

TABLE 13: ALL SOURCES OF INCOME RECEIVED BY LANDLORDS IN PREVIOUS 12 MONTHS BY CITY

Sources of income

Auckland

Wellington

Christchurch

Dunedin

Total

Rent

82.5%

88.9%

93.0%

95.0%

85.9%

Wages, salary, commissions, bonuses, etc., paid

by my employer

52.5%

54.0%

45.1%

55.0%

51.6%

Other superannuation, pensions or annuities

(other than NZ Superannuation, Veteran’s

pension or war pensions

4.3%

11.1%

7.0%

5.0%

5.8%

New Zealand Superannuation or Veteran’s

Pension

22.2%

25.4%

40.8%

40.0%

26.8%

Interest, dividends, other investments

24.1%

30.2%

22.5%

25.0%

24.8%

Self-employment, or business I own and work in

(other than residential rental property)

22.2%

20.6%

26.8%

20.0%

22.6%

Labour Market Status

Percent

Working in paid employment

182

44.28%

Retired

120

29.20%

Self employed

20.68%

Parenting/caregiving or doing unpaid work at home

1.46%

Unemployed

1.70%

A school or tertiary student (tech/Uni/teacher training)

1.22%

Not in work because of illness

0.73%

Refused

0.73%

Sources of income

Auckland

Wellington

Christchurch

Dunedin

Total

Other sources of income, counting support

payments from people who do not live in my

household

3.1%

1.6%

0.0%

5.0%

2.4%

Other government benefits, government income

support, war pensions, or paid parental leave

1.2%

6.3%

0.0%

10.0%

2.2%

Regular payments from ACC or a private work

accident insurer

0.0%

1.6%

5.6%

5.0%

1.5%

Welfare benefits (unemployment, sickness,

domestic purposes and invalids combined)

1.6%

0.0%

5.0%

1.1%

Investment rationale

Half the landlords (51.6%) surveyed owned a single rental property, a further 25.8% owned two properties,

and 10.1% owned three properties. Diminishing numbers of respondents owned more than three, with 15

properties being the largest portfolio reported. The percentage of landlords who indicated they had bought

property as an investment was 86.6%, the same as in 2015.

Survey respondents were asked about their original reasons for purchasing a rental property, the reasons they

bought their last rental property (for some individuals this was the same property), reasons for selling if

properties had been sold, and future intentions around rental property purchase.

Consistent with landlord responses in the earlier 2011 and 2015 surveys, the most common answer given for

purchasing their first rental property was ‘as a form of retirement saving’. As indicated in Table 14, allowing

respondents to give multiple responses, the four most important reasons reported in 2021 were: as a form of

retirement savings (40.6 %), as a secure safe investment (34.3%), capital gain (25.5%) and rental income

(23.4%). A small number of respondents (4.4%) indicated growing an investment portfolio as a reason for first

purchasing a rental property. Others had become accidental landlords, for example, through an inheritance.

While there was some variation in responses by age group and for those owning one or more than one rental

property, no consistent pattern is evident in the data.

TABLE 14: WHAT WERE YOUR ORIGINAL REASONS FOR DECIDING TO INVEST IN RENTAL PROPERTY?

Original reason for investing

Percent

As a form of retirement savings

40.6%

Secure / safe investment

34.3%

Capital gain

25.5%

Rental income

23.4%

Originally bought to live in

11.7%

Good returns

10.0%

Pass on to family members (e.g., through inheritance)

7.3%

Possible future home

4.9%

Original reason for investing

Percent

To diversify / grow investment portfolio

4.4%

Took over from parent /partner - inheritance

3.4%

Better bet than finance companies

1.9%

Advice from others

1.5%

No confidence in the share market

1.2%

Negative gearing (maximising tax deductions)

1.2%

Ability to leverage /borrow

1.2%

Ability to add value through improving the property

1.0%

None of the above

5.4%

Don’t know

0.2%

Total

411

A similar pattern of responses was evident when landlords were asked the reasons (and most important

reason) for buying their most recent rental property, with the most frequent responses reported: as a form of

retirement savings (37.7 %), capital gain (21.2 %), and rental income (18.7%). Retaining a home originally

purchased to live in and providing housing for family members were other common pathways to becoming a

landlord, especially for landlords with a single rental property. Providing accommodation for a family

member/s was more common in older than younger landlords, peaking in the 60–64 year age band where

15.2% of landlords indicated this was the most important reason for purchasing their most recent (or only)

rental property. Inheritance also featured in the data as a reason for becoming a landlord – due to inheriting

from parents or a partner, and as an intention to pass property on to family members.

Only eight respondents had ceased being landlords over the past two years, lower than the 23 reported in

2015. This may suggest the few years prior to 2021 were a good time to be a landlord, with fewer deciding to

exit the rental sector. There was no common reason for selling amongst this small group of landlords.

A more nuanced understanding of landlords’ investment rationales was revealed through analyses of the 34 in-

depth interviews with landlords. While planning for retirement was the predominant rationale across the

sample, some diversity in investment rationales was discernible. Four clusters – retirement planners, rental

property investors, housing service providers and accidental landlords – will be discussed. However, we are

mindful in using such a typology that the clusters have fuzzy edges, with commonalities and differences that

span the clusters.

Retirement planners

Investing in rental properties as part of planning for retirement was a recurring theme. New Zealand

superannuation was considered inadequate to secure a comfortable retirement and investing in property was

a means to that end. Acquiring property was a form of compulsory saving, and when mortgages were paid off,

a store of wealth. Most landlords, including this group of retirement planners, had no significant investments

outside of property.

A quarter of the landlords surveyed were retired, and a further 36.2% said they intended to continue to rent

properties and live off the cash flow when they retired. Selling up on retirement was the plan for 21.3% and

passing property to family members was intended by others (11.5%).

The qualitative interviews confirmed the varied current and long-term intentions of landlords. Owners of a

single property, 59% of whom reported managing the property themselves, indicated that sometime in the

future they would need to weigh up their capacity to continue maintaining properties and whether the capital

value they would realise from selling the property would be enough to support them through retirement. The

future plans of landlords with multiple properties varied and included selling a proportion of their portfolio

but, if they felt capable, keeping a reduced number as an income stream into their retirement years. Half the

owners of multiple rental properties in the survey managed one or more properties themselves and a further

10% indicated they did so while also using property managers for other rental properties.

Investing in property was frequently expressed as a part of the New Zealand culture, with the practice of

storing wealth in property for retirement seemingly a self-evident course of action.

“Probably like every other New Zealander, it’s a more reliable place to put your money. It’s like biting the

gold coin, isn’t it? You can see it and you know that it’s there, and maintenance and all those things

aside, it isn’t going to go away.” (Jenny WLG 1)

For this group rental income was often a less important rationale for owning an investment property than the

prospect of releasing capital for retirement.

Among the single investment property landlords, there was seldom the inclination to consider their rental as a

business investment or to plan to expand their portfolio. As evidenced in the excerpt below, running

investment properties as a business was a foreign concept for some.

“We’re certainly not someone with a block of flats in the sort of European mode … the rental market in

New Zealand isn’t like the European market … Obviously, [the property] is an income at present, but

yeah, there will be a point in which it will be sold. Yes.” (Jenny WLG 1)

The overwhelming sentiment voiced by this group of landlords was that rental property is a safe and doable

form of investment for retirement compared to other investment options. They tended to buy properties of a

standard they would live in themselves, and often located near where they lived. It was also common for these

landlords to manage the tenancy and maintenance themselves.

Rental property investors

While retirement planning was the main driver of rental investment, acquiring multiple properties was

explicitly a form of wealth creation and/or a business for a few interviewees. Collecting rent from tenants

provided financial independence in the present and the prospect of continued independence into retirement.

These landlords were more likely to talk about the profitability of their investments than retirement planners

with a single property. Operating on a marginal profit basis was rationalised by viewing the properties as a

long-term investment that would see costs increasingly covered as the rental income increased and the

mortgages were paid off.

“It seemed logical … that you would … first have to put some money into the property but after a while,

with rising rent and so on, you probably wouldn’t have to put in anything.” (Meredith AKL 12)

As the landlord below explains, rent collected would sustain their household through a ‘passive income’.

“My plan was to buy one more house within the range that I could afford, and then I could rent it out

and I could have some passive income, that's … the main advantage … having a passive income, and

also, the capital gain of the rental property in the future.” (Weining AKL 2)

For others, generating an income from properties was a means to reduce or leave salaried work and have

more time to follow other interests or be with family.

Housing service providers

A small number of participants saw being a landlord and maintaining their properties as a business providing

housing services and a form of self-employment. However, these landlords were also inclined to position

themselves as investors, underscoring the lack of clear boundaries between the different landlord categories.

Accidental landlords

There were several familiar scenarios for becoming an accidental landlord – a person who had not intended to

become a landlord (except for accommodating a family member) when they acquired a rental property. For

example, inheriting a parent’s home, buying a property that had a second dwelling, and purchasing a property

for a family member who subsequently moved on or died. Rather than selling the additional property, these

interviewees had decided, at least in the interim, to retain and rent the property. They could no longer be

considered an accidental landlord if they decided to remain a landlord and rented the property to non-family

members at this point they would become a property investor. This is an example of the fuzzy edges between

these clusters.

Family matters

Rental investment decisions were often influenced by family considerations, for example, accommodating

older relatives or parents or providing for their children’s future, either through the investment capital or as

potential homes.

“So my eldest is single and he can’t even afford to buy a house so he’s renting at the moment. My plan is

to buy as many houses that I can using my assets so you know all the kids can rent because in the long

run it’ll benefit them when I go … that’s my dream, but I don’t know how that’s going to happen.” (Fiona

AKL 1)

It was also not uncommon to hear landlords recount that family members had lived in their rental properties

for extended periods of time, paying no rent or substantially below the market rate.

Managing properties in all landlord categories was also frequently depicted as a family affair, with partners

sharing the duties of being a landlord. For example, one might be looking after general maintenance and

repairs while the other kept track of rental income and expenses. Family members were also an important

source of information on property investment opportunities and/or motivation for buying or selling. Several

older landlords mused over whether they might struggle to fulfil their role as a landlord if their health

declined. Such thoughts prompted questions regarding when to sell and the potential role family members

might play in this decision.

Selecting rental property

In this section the reasons landlords gave for their locational choices are discussed, as well as their preferences

for new or second-hand properties. This excludes the 3.4% of landlords who inherited properties.

As noted above, over half the landlords had a single rental property and less than a quarter owned more than

two rental properties. While most landlords owned rental properties in their city of residence, 22% of

landlords in Auckland, 20% in Wellington, 18% in Christchurch and 14% in Dunedin owned properties in

centres other than where they lived.

‘Close to where I live’ was the most common reason landlords gave for the location of their most recently

purchased rental property (34.8%), followed by the property being close to amenities (23.8%), and thirdly that

it was affordable/good price (19.2%). It is notable that the fourth most common reason provided for landlords’

location choice was that ‘It was or will be a family home’, reported by 10.9% of respondents. This response

that was more common for owners of a single rental property than those with more than one property.

The in-depth interview data presented a similar picture. Familiarity and proximity were primary drivers of

location decisions – landlords favoured neighbourhoods they lived in, had previously lived in, or which were

nearby. A few landlords had moved to a new home but retained and rented out their previous home, often in

the same neighbourhood.

As noted earlier, where the landlord was living proximate to the tenanted dwelling (e.g., nearby or in the same

suburb), a ‘hands-on’ approach to managing the property was common.

Two thirds of landlords expressed a preference for purchasing existing properties. In 2021, compared to 2015,

there was a small increase in the percentage of landlords with a preference for purchasing new properties

(2015, 9.8%: 2021 12.9%) or both new and second-hand properties, but the difference was not statistically

significant (Table 15).

TABLE 15: PURCHASING PREFERENCE

Purchasing preference

2015

2021

Both types of properties

17.2%

19.7%

New properties

9.8%

12.9%

Existing properties

73.1%

67.4%

The stand-out advantage of second-hand properties reported (Table 16) was they are cheaper to purchase

(38.2%), followed by the ease of acquiring a property already in situ (19.8%), and the potential to add value

through improvements (11%). New advantages identified in the 2021 survey included their generally larger

sections (8.8%) and their location in established neighbourhood, which, given the disproportionate number of

Auckland respondents, may signal awareness of the development opportunities enabled by the Auckland

Unitary plan and the requirements of the National Policy Statement on Urban Development (NPS-UD).

TABLE 16: ADVANTAGE OF EXISTING PROPERTIES

Advantages of existing properties

Percent

Cheaper to purchase

38.2%

Easier, no need to develop / build

19.8%

Ability to add value by making improvements

11.0%

Generally larger sections

8.8%

Located in established neighbourhoods

7.8%

Expectation of better quality housing

7.8%

None

6.0%

Larger pool of properties to choose from

5.7%

Resale market often wider because includes both other investors and owner occupiers

1.1%

None of the above

11.3%

Don’t know

11.7%

Total

283

A greater requirement for maintenance (65%), cost of compliance with regulations (20.8%) and increased cost

of upkeep for an older property (18.7%) were the most common disadvantages reported for second-hand

properties. The advantages of new properties tended to be the corollary of the disadvantages of older

dwellings, cohering around a lower requirement for maintenance (60.4%). Additional benefits of purchasing

new builds included: better building quality meaning higher rental income (26.4%) and financial advantages

(e.g., tax or borrowing – also 26.4%). Regarding disadvantages, reporting no disadvantages of purchasing new

dwellings was the most common landlord response (25.5%), followed by the higher purchase cost (21.7%) and

risk of damage by tenants (16%)

Consistent with the strong preference for second-hand properties, some landlords noted during the in-depth

interviews that they looked for a ‘do up’ in need of repair. These properties were often favoured for their

longer-term investment potential and as a project that they could work on, either through their own ‘DIY’

improvements or with more significant renovations.

“To buy … second-hand property that were a bit tired and but actually … you could rent them

immediately [and] after a while you could improve them just by painting and … not huge renovations,

but … painting and carpet and vinyl and stuff.” (Meredith AKL 12)

Also represented in the in-depth interviewee sample were landlords who had an apartment as a second

property. Body corporates commonly took responsibility for some of the dwelling maintenance and often also

set limits on what tenants were permitted to do inside and outside of the property. Paying body corporate

fees and reducing responsibility for maintenance and management appealed to some interviewees:

“investing in an apartment … you don’t have as much outgoings cause you don’t have all the land to

deal with and that sort of thing … apartment properties now have people that actually deal with the

whole block … and you just buy the apartment, and they deal with it.” (Pauline CHC 2)

A second dwelling built at the back or front of the landlord’s existing home was another relatively common

rental scenario. The motivation for subdividing and building a second property was often to provide a home

for family members. However, for various reasons these properties ended up being rented out for income –

either due to changing needs or after family members no longer required the dwelling.

“Well, we didn’t build it as a rental property we built it for our children so that they’d have a stepping

stone up … the property ladder … but neither of the girls wanted to stay for various reasons … then

[we’ve been] letting it out now and then … I think maybe 20 years or something like that.” (Prisha AKL 1)

The proximity of such properties often led to landlords becoming more familiar with tenants and taking a

‘hands-on’ approach to management and maintenance of the rental property.

Those who had bought a new build property commented on how they enjoyed the minimal maintenance

required. In addition, the Healthy Homes regulations had possibly increased interest in new builds as rental

properties as they tend to already fulfil requirements, compared to the potential costs of upgrading older

properties.

“I think a lot of the concern is around if it’s an older property, it’s the maintenance of it and keeping it up

to speed and also the new tenancy rules that have come out, I believe that there is quite a few landlords

finding that a bit of a struggle.” (Sally WLG 5)

Furthermore, the exclusion of new builds from recent changes to tax regulations for landlords has likely

increased their attractiveness as an investment over existing properties. One landlord stated that the recent

tax regulation changes had not affected their intention to invest in property, only the type of property:

“This will not affect my decision to buy an investment property, but it will affect the type of property I

will invest in. According to the current policy, many people will want to buy a new house because it will

be exempted, including its interest liability, this could also be exempted. In fact, the current policy will

push many people to buy a new build.” (Weining AKL 2)

Financing rental property

This section reports on survey findings on how landlords who financed a deposit on their first rental property

did so, ongoing financial management and yields from rental properties. This is followed by a discussion of

related matters covered during the qualitative interviews.

Half the landlords surveyed (50.6%) indicated they had used accumulated savings to fund the deposit on their

first rental property and a further third (33.6%) had used equity in an existing home to release funds for a

deposit. An inheritance was drawn on by 7.5% of the sample and a family loan or gift from parents provided a

deposit for 3.6% of landlords.

When taking account of deposits on all rental properties purchased (not only the first), 38.6% of landlords said

they had drawn on equity in a property they owned as a deposit. Of these individuals, 15.9% said they had

been encouraged by a bank to do so.

Just under a third of landlords (31.5%) had no mortgage on their rental property, a slightly higher figure than

reported in 2015 (26%). Of the landlords with a mortgage, 45.9% were making interest and principal payments,

16.7% interest only and 5.9% had a combination of interest only and interest plus principal mortgages (Table

17). Unsurprisingly, the percentage of landlords without a mortgage increased by age from 0% for the age

bands under 40 years, through to 33.3% for 60–64 year-olds and 53.9% for those over 65 years.

TABLE 17: WHAT TYPE OF MORTGAGE DO YOU HAVE ON YOUR RENTAL PROPERTIES

Mortgage type

percent

Combination of interest and principal

(multiple properties)

5.9%

Interest and principal

179

45.9%

Interest only

16.7%

No mortgage

123

31.5%

Total

390

100.0%

Landlords with a single rental property were slightly more likely to have no mortgage (34.2%) than those

owning more than one (28.8%).

When asked ‘What is your average rental yield on your rental property or properties?’, just over half (51.2%)

said they did not know, lower than the 59% who responded similarly in 2015. Of the remaining respondents

who indicated they did know, 11.1% said their average yield was either 1 or 2%, 20.9% said either 3 or 4%, and

11.3% said 5, 6 or 7%. A yield of more than 10% was suggested by a small number of landlords (2.8%). The

pattern of yield estimates was similar whether landlords had a single rental property and/or more than one

property. Of the landlords reporting they had no mortgage, 57.4% said they did know the rental yield on their

property. While this was higher than the 47.6% recorded for landlords who had a mortgage/s, the difference

was not statistically significant.

Purchasing rental property often involved taking on significant debt. As the quote below indicates, mortgage

repayments and other costs associated with the properties (i.e., maintenance and improvements) would often

be equal to or exceed the rental income.

“No I don’t … I don’t [make] any money off any rental, in fact, I put money into the rental. I’m paying

into both my rentals because … I don’t profit off my rentals and probably won’t for another five to eight

years.” (Margaret DUN 2)

Drawing on equity in other properties, buying cheaper properties, and taking out interest only mortgages were

strategies landlords used to start and/or expand their rental portfolios.

“The property paid for itself because we didn’t have a lot of spare cash but you know if you buy cheaply

enough and the rent will cover the mortgage or almost cover the mortgage.” (Meredith AKL 12)

“They all start off interest only ‘cause that way they were cost neutral. The rent covered the mortgages

and the other costs … They're all pretty much mortgaged up to the hilt. We’ll start at looking at paying

one of them off and then slowly go through them.” (Danielle WLG 4)

Other landlords, often those who had been investing in properties for a longer time, were more secure

financially, having reduced debt and/or become mortgage free. With the changes to tax regulations for

property investors, particularly around deductions – negative gearing – these individuals were less affected

and therefore less concerned about any resultant increase in personal tax.

“Our debt, LVR is actually quite low because we’ve had them for so long, it will affect us, but it won’t, it’s

not going to be as bad as potentially we thought.” (Charlotte CHC 5)

Many single property landlords expressed no interest in buying more property. Rather, as Prisha explains, they

were content with a single rental property, viewing it as a safe investment that provided financial security for

their retirement.

“It’s bringing in a bit of rental, it is a comfort to us, yes … we have food on the table … a roof over our

heads, but I think … at the end of the day the property is paid off and, and the money is there.” (Prisha

AKL 1)

Several landlords of this ilk took care to distance their own landlord practices from those of others they saw as

more investor or business oriented.

“…running a business or anything … [it’s] just … a means of extra income and a good investment … we

have a small mortgage … which we used the rent to pay off as quickly as we could … we weren’t trying

to offset against losses or anything like that. (Tracy AKL 1)

“…we're not the kind of investors who are very good at [investing] … all we did was rent out our old

house, and that's it, just that one house.” (Ronghao AKL 1)

Others were quite clear they did not have the capital available to invest in further properties.

Returning to the survey data, at the city level, landlords in Wellington reported receiving the highest mean and

median rents. As indicated in Table 18, Auckland rates were the second highest and Dunedin rates were the

lowest.

TABLE 18: MEAN WEEKLY RENT BY CITY

City

Mean

Median

Auckland

231

550

510

Christchurch

419

400

Dunedin

381

358

Wellington

597

537

Combining data across the four cities, mean rents had increased significantly between 2015 and 2021 from

$402 to $526 per week (p=0.0000). The mean and median rents reported by landlords who engaged property

managers ($556 and $517 respectively) were higher than those reported by landlords who managed

properties themselves (a mean value of $516 and median of $460). As noted earlier there are many factors

other than property management fees that determine rent on a dwelling.

In addition to being asked about the number of rental dwellings they owned, landlords were asked about

vacancies at the time of the survey. Of the 818 dwellings owned, 33 were vacant at the time of interview, and

a third of these were being refurbished. Tenants were being sought for eight dwellings, five were for sale and

four under construction, leaving only five with no explanation for the vacancy.

The total value of the property portfolios of those landlords who provided data is presented in Table 19,

however only around two thirds of landlords provided this information.

TABLE 19: WHAT IS THE COMBINED VALUE OF YOUR NEW ZEALAND PROPERTIES (IN NZD) BY CITY

Landlord’s city

of residence

Mean

Median

Auckland

181

1,711,630

1,200,000

Wellington

1,408,846

1,000,000

Christchurch

1,315,943

680,000

Dunedin

2,087,692

750,000

Only 14.5% of landlords said they had refinanced in the previous two years. When asked what effect

refinancing had on their investment portfolio, the most common responses were: it had no effect (37.3%) and

it reduced their interest rates (35.6%).

Less than 4% of respondents said they belonged to a property investors’ association.

Managing and maintaining rental properties

This section covers the survey and qualitative interview data on landlords’ various approaches to managing

tenants and property, including repair and maintenance practices.

Asked whether they managed their rental property themselves or employed a property manager, over half

(54.7%) the landlords said they managed rental/s themselves, 38.2% engaged a property manager, and 5.4 %

did both (Table 20). The percentage managing properties themselves was lower than the 67% recorded in

2015. A possible explanation for the drop is the older age of landlords in the recent survey.

TABLE 20: DO YOU MANAGE YOUR PROPERTIES YOURSELF OR DO YOU USE AN AGENT?

percent

Both

5.4%

Employ staff to manage property

1.5%

Engage a property management company

157

38.2%

Manage them myself

225

54.7%

None of the above

0.2%

Total

411

100.0%

Of those who engaged a property manager, 85% were satisfied or very satisfied with the competence of the

agent, and 78% were satisfied or very satisfied they had received value for money. Landlords’ positive

assessments of value for money had dropped slightly since 2015 (down from 83%) but satisfaction with their

property managers’ competence was unchanged.

As the survey findings indicate, many landlords take on most, if not all the management duties themselves.

Landlords with a single rental property, especially if located close to their residence, were very likely to

manage the properties themselves, stating that it was mostly an unchallenging and manageable workload.

While landlords with a portfolio of rental properties were more likely to employ the services of a property

manager, a number of these, like Deborah quoted below, still managed the properties themselves.

“I mean obviously there has been changes to the tenancy laws … recently … but I wouldn’t say that’s a

disadvantage, I suppose I’m not sure we’d do more than six [rentals] and we possibly will look to

decrease, because it is quite a lot of work looking after six, we do it all ourselves, we don’t have a

property manager.” (Deborah WLG 6)

For some the reason for managing property themselves was financial, but others enjoyed the personal

engagement with their tenants, felt they knew best what their property needed and liked to feel they were

offering “a nice home to live in”. Narratives varied however, and while many took pride in being good landlords

for their tenants, others were stressed by what they considered to be the demands of tenants.

“We [manage] that ourselves … They’re very demanding, tenants are very demanding when there’s

something wrong they expect you, even in the weekends, to drop everything and go and do the job.”

(Pauline CHC 2)

There were mixed opinions about property managers. Most landlords who were currently using a property

manager had little to say other than they liked it because they didn’t need to worry about managing their

property and tenants (other than receiving reports and making final decisions on tenant selection). However,

one landlord argued that property managers played a key intermediary role between the landlord and tenant

and therefore needed greater regulation.

“The difference between a good property manager and a bad one is huge. In fact, the property manager

is a very important middleman, if he is not able to convey the tenant's needs to the landlord in a timely

manner, then it is actually very difficult for the tenant and the landlord to build a good relationship.”

(Weining AKL 2)

Out of town landlords commonly used property managers and, as Annabelle said, valued their assistance with

selecting tenants and meeting the legal requirements of tenancies.

“The good things are … having somebody do all that due diligence around your tenants … And I think

having somebody if you’re not available [who] can sort stuff out is really helpful and their job is to be on

top of all the legal requirements … That’s helpful when you’ve got a full-time job … trying to stay on top

of all of that. It is quite a responsibility and a job having a rental property.” (Annabelle CHC 4)

Several landlords talked about previously using property managers but finding their service to be unreliable,

with a lack of attention to the property and the actions of tenants – for example, finding a property dirty and

damaged at the end of a tenancy, without having been notified. High staff turnover in property management

companies was another concern.

A few landlords had a ‘hybrid’ approach in that they would employ the services of a property management

agent for some tasks but take on most of the management themselves. Usually this meant a property agent

would advertise properties for letting and conduct a vetting process before recommending tenants to the

landlord.

“I used myrent.co.nz … they will advertise my property for me through many channels … I have criteria

for tenant selection, for example, I don’t like pets, so no pet, no smoking, I will list these criteria down.

And [they] will check the background of the tenants for me … [it’s] very convenient … This is somewhat

like the role of a property manager, but it is a passive rather than active management.” (David AKL 1)

Property managers were also used for temporary and fixed periods of time, for example when the landlords

were going to be away for an extended period.

Maintenance matters

A third of landlords (32.2%) said they had a structured maintenance management plan for their property

portfolio. Landlords using property managers were significantly more likely (p < 0.03) to say they had a

structured maintenance management plan than those who managed a rental property themselves. Asked how

much they would typically spend per year on each property in a portfolio, the mean and median figures

reported by landlords were $4,398 and $3,000 respectively.

Consistent with the survey findings, the in-depth interviews revealed landlords who did not use a property

manager seldom adhered to a maintenance schedule. Attending to repairs was largely ‘as and when required’

and with trusted tenants, formal inspections were rare. If they occurred at all, they took place informally, while

completing other landlord duties, such as doing regular or requested maintenance.

“In a way, it’s never been really necessary to do a formal inspection. And in a way, if you’re comfortable

about tenants, that does seem really invasive somehow.” (Jenny WLG 1)

Many landlords were happy to ‘keep an eye’ on their properties, sometimes simply by driving by if in the

neighbourhood. The landlord quoted below lived next door to their only rental property and so did not feel the

need for a property manager or for regular inspections.

“We don’t have a regular schedule of official inspections … We can see that they’re opening all the

windows each morning and airing the place out … you don’t really need to make an official inspection

‘cause you can see that she’s looking after the place. It’s clean and reasonably tidy, there’s no damage

going on.” (Tracy AKL 1)

Landlords who used property managers mostly left property inspections and general maintenance to their

agent. Inspections were reportedly regular in timing and frequency. The following quote describes a working

relationship between landlord and property manager:

“They send sort of every three-month reports and … they’re very good at getting back to us … one of our

tenants moved out in Wellington and there was a week break so … [she asked] do you want us to do any

maintenance? … would you like us to go through and paint while it’s empty? You know they’re sort of

really proactive which is great … below a certain amount they just get on with it and I think maybe over

$500 they let us … just to approve it or whatever.” (Charlotte CHC 5)

When asked ‘If you had $10,000 to invest to improve a rental property what would you be most likely to spend

it on?’, 15.5% of landlords said their property needed no improvements. The most common response (19.7%)

was general maintenance (e.g., electrical faults, leaks, repainting, broken windows), followed by external

improvements (e.g., fencing, decks, landscaping) (13.1%) and kitchen improvements (12.8%). Only 8.9 % of

landlords said would invest in insulation, a far lower figure than the 21% recorded in 2015. This drop may

suggest, at least from a landlord’s perspective, that insulation standards have improved following the

introduction of the Healthy Homes legislation.

The response of landlords to the needs of tenants with disabilities was investigated. When asked if they had

made modifications to a property to meet the needs of a tenant with disabilities, 10% said they had. Around a

third of these landlords indicated the modification involved adding ramps and a further third had added rails.

Various other modifications were noted, including improving wheelchair access to bathrooms, installing an

emergency alarm and ventilation for a tenant with asthma. Most landlords (94.4%) thought there was a link

between someone’s housing and their health.

Managing tenants and tenancies

Over half the landlords (59%) surveyed said they had not considered targeting niche markets. Of those who

had considered it, couples and older people were the most frequently reported groups, followed by tenants

with pets. When landlords used property managers to select tenants, while they often had a final say in tenant

selection, they would usually take the advice of the manager.

Survey findings showed the four most common criteria used by landlords who selected tenants themselves

were: good references, a secure job, good impression on meeting, and gut instinct. A security check was the

fifth most common criterion reported. During the in-depth interviews, tenants’ ability to pay rent and care for

the property often emerged as landlords’ primary concerns, with the criteria noted above (secure jobs, good

references) serving as proxies for meeting these concerns. A specific type of household was a secondary factor,

beyond simply being “someone who … has got the income to pay the rent and will look after the property”

(Jacob AKL 7).

“No … Just normal people … I don’t mind … I don’t mind if they’re couples, singles or families … Just ones

that pay on time I guess.” (Danielle WLG 4)

However, a hierarchy of preferred tenants was also still often evident, with many landlords stating a

preference for a family or working couple. People without permanent employment and in particular young

people and students were among the least favoured.

“I guess it’s one of those things when you talk to somebody you can read them pretty quickly and you

get a feel. What I want is one that can first of all afford it and have employment prospects long term, so

that … sort of rules out … students, your low-end unemployed cause they just wouldn’t afford these.”

(Leni WLG 6)

“I've always had good tenants. I pick the right people. I wouldn’t have young people. I've had students

and it doesn’t work cos they party and things.” (Joyce DUN 1)

However, one landlord with multiple properties in Dunedin targeted students. They aimed to keep rent

affordable and cater to the needs of students while studying:

“…we don’t want … our student rentals … to be top of the range, it’s a little bit about, I’ve worked with

student population for a number of years, it’s a little bit about looking after them” (Lisa DUN 3).

When asked about the reasons tenants had vacated their rental properties, the most common landlord

responses were moving city, buying their own home and a change in family circumstance (e.g., relationship

breakdown, illness, job loss). Fifteen percent of landlords had had no tenant leave and 9.5% mentioned

eviction. However, when asked directly if they had evicted tenants, 28.5% of landlords said they had. Anti-

social behaviour, property damage and non-payment of rent were the most frequently cited reasons for

eviction.

Asked where they would go to seek help or advice over problems with tenants, landlords mainly identified

either the Tenancy Tribunal (57.7%) or a property manager (32.8%). A lawyer, Citizens Advice Bureau and

friends and family were noted by smaller numbers of respondents.

Most landlords (95.2%) indicated they had signed tenancy agreements for all their rental properties and 92.2%

said they collected and lodged bonds for all properties. These figures are higher than the corresponding figures

of 92% and 81% respectively reported in the 2015 survey. When asked if any of their tenants were receiving an

accommodation allowance, almost half said they didn’t know and of those who did know, around a third said

yes – 15% of landlords.

The use of fixed long-term tenancies was reported by 43.2% of landlords surveyed. When asked about the

advantages of such tenancies, common responses were finding and keeping better tenants and certainty

around cashflow (see Table 21).

TABLE 21: WHAT ARE THE ADVANTAGES TO A LANDLORD OF FIXED, LONG-TERM TENANCIES?

Advantages of Fixed, Long-Term

Frequency (%)

Finding and keeping better tenants

67 (40.1%)

Certainty around cashflow period

65 (38.9%)

Property is vacant less often

39 (23.4%)

More control over tenancy period

33 (19.8%)

Don’t know

16 (9.6%)

Refused

NA (NA%)

Total

167

Most landlords interviewed stated they favoured having long-term tenants and were hesitant to make any

significant increase in the rent for an existing tenant.

“We have a … philosophy of not increasing the rent … If you have a good tenant, why would you risk

losing them for increasing the rent just … $30 a month … We only alter the rent when a tenant leaves …”

(Paul AKL 2)

“The other thing we do, we don’t chase the high dollar for tenancy. I’ve got a [tenant] in the one unit,

the first one we ever bought, and he was … going to be in there for a short time … well, twenty-five

years’ later he’s still there … our philosophy is get a good tenant for long-term….” (Piotr WLG 3)

However, landlords who used property managers tended to be guided by their advice on setting and raising

rents and as the quotes below suggests, sought to keep their rents aligned with market rates.

“… they’re supposed to know the market. We’ve got some idea, but we don’t want to overcharge, but

clearly whatever’s appropriate for the market.” (Patrick CHC 2)

“Depending on obviously if it is a re-rental, then the suggestion would be a slightly bigger increase …So

they might say all the other rents in the area are the same, so we’ll keep it the same. Everything else is

going up so we’ll go up as well. Just trying to keep it at the standard level.” (Danielle WLG 4)

However, others commented that even though they used property managers, they did not like this approach

to setting rents as they valued keeping good tenants in their properties more than ensuring they were paying

the market rate.

“Our first one in Hamilton, [the property manager] raised it without telling us and … we told them on no

uncertain terms that they were never to do that again and they are not raising the rents and to put a

flag on our file so yeah only when the tenant changes.” (Paul AKL 2)

When asked if property managers had suggested increasing the rent on any of their properties, the survey

respondents answered: always (22.5%), sometimes (45.1%) and never (32.4%). Of the landlords always or

sometimes advised to increase rents, 29.7% said they always acted on the advice, 48.6% sometimes did and

21.6% never.

Property managers were expected to have expertise in dealing with tenancy law and tenant problems,

knowledge not all landlords felt they had the time to keep up to date on. Time was amongst a range of reasons

Sally gave for using a property manager:

“The main one for us is time, they’re able to keep up to speed with the changes ….so we rely on them to

keep us up to speed with compliance. It also removes any difficulties … if you did have a difficult tenant

… you don’t have to deal with that because, yeah, we just find it easier … and same with the rental

collection, we take their advice on rental increases.” (Sally WLG 5)

Regulation and standards

Healthy Homes

The Healthy Homes regulations were accepted as a necessary layer of protection for tenants by most

landlords. This contrasts with landlords’ views recorded in the 2015 study when the legislation was on the

horizon and a point of debate. While supported by some at the time, others opposed the proposed changes,

seeing them as unnecessary or well-meaning but likely to have unintended consequences.

In the more recent interviews, landlords had largely accommodated to the Healthy Homes requirements, were

accepting of the legislation and most recognised the value of providing healthy rental homes.

“New Zealand’s got a problem with [damp]. Our house is pretty good, I don’t mind the healthy homes

stuff at all … we lived in it, so I wasn’t going to live in a damp home either.” (Harry AKL 1)

However, regulations around heating still generated some dissent. Resistance centred on the requirement to

install ‘expensive’ heaters, their potential to lead to rent increases and to be ineffective, especially if tenants

simply avoided using them to lower their electricity bills.

“We’re really conscious, when you’ve got low-income tenants, actually running a heat pump is not

necessarily something that is going to work for them … it’s too expensive for them.” (Annabelle CHC 4)

Similar anecdotes of heat pumps going unused were recalled by landlords of Dunedin student flats. These

landlords argued against what they saw as broad-brush rules that missed the nuances of different types of

properties, locations and tenant needs. Another familiar narrative concerned moisture leading to damp and

mouldy homes, with interviewees suggesting it was not only a landlord concern and that tenants could help

reduce moisture by airing the house regularly and this would have more impact than heating and insulation

regulations.

“I agree obviously with … the regulations about putting in insulation and stuff like that into houses. But

sometimes I think … tenants need to … be a wee bit more proactive also … Sometimes I … think well do

they actually air the place out? Do they open the windows for fifteen minutes a day? … There’s two sides

to the story I think.” (Trever DUN 1)

While many landlords had acted early to comply with new standards, others, like Penny quoted below, were

aware but waiting until action was necessary.

“…until [the tenant] moves … out, really, we don’t have to deal with it. It’s not bad. I mean, we’ve done

the insulation in the property … and smoke alarms … [But] we know that if we get somebody else in

there, we would need to put some sort of heat source in.” (Penny AKL 3)

Landlords’ attention had shifted to the more recent changes to tenancy laws to improve tenant security and

the changes to tax policy around investment properties.

Tenure security

Overall, there was a feeling that the recent regulatory changes had tipped the scale towards tenants’ rights

over those of landlords. Increasing the rights of tenants to make small modifications to the property and the

removal of ‘no cause’ terminations etc. were considered a step too far by some.

“I think the government is very protective of tenants … [there are] a lot of rules and regulations we need

to fulfill, and … because the government is more concerned about protecting the tenants, we have to be

very, very careful when renting out our property.” (Ronghao AKL 1)

“We very much feel that the rights of landlords have really diminished … with the new changes …

tenants have more rights, and they can do painting and alterations and goodness knows what else in

your home that is very off-putting and if it came to a choice of not being able to find the right tenant we

would probably sell.” (Helen AKL 3)

However, while most landlords expressed some concern about their options if they encountered a bad tenant,

most reiterated that their experiences with tenants were overwhelmingly positive. And, unlike Helen in the

quote above, most landlords viewed a rental property as the tenants’ ‘home’ and not their ‘home’. Some

interviewees also felt the changes were important to balance the rights of both parties and reflective of

growing numbers of long-term renters. Meredith had been a landlord for over 50 years and currently owned

12 rental properties. She supported the recent changes to the tax laws and tenant rights, believing they were

overdue and unlikely to make being a landlord unattractive.

“Landlords have had a very good run, had a lot of advantages, they’ve been given quite a lot to

encourage them … to have more of a balance is probably good … some landlords … charge their tenants

for things that they shouldn’t … don’t give back bonds and don’t do repairs and stuff like that, so I think

putting more pressure on landlords and making it more fair for tenants is a good idea.” (Meredith AKL

12)

Noting the poor quality of some rental housing, Rachel went further, suggesting the need for a warrant of

fitness for rental properties:

“I think it’s despicable and I think there should be a housing warrant of fitness for anybody who is a

landlord and wants to rent out a house … … [to] bring the house up to a proper standard and then

incentivise people to want to live there long-term so they can actually become part of the community,

the school or whatever.” (Rachel AKL 1)

Tax regulation changes for investment properties

Frustration at changes to tax settings for rental properties was common, with many landlords feeling they

were being made a scapegoat and unfairly blamed for housing affordability. A few interviewees who had larger

portfolios spoke passionately about feeling their mode of business was being unfairly singled out.

“The government doesn’t like us anymore … the government is trying to hurt people that have chosen

this as a way to fund their futures … [we’re] just like anybody else that’s in a business, that’s trying to

make a dollar to give them something to live on. The playing field isn’t even anymore.” (Barbara AKL 5)

Several landlords with only one or two rental properties felt they were being more adversely affected than the

property investment businesses they saw as likely to benefit from the changes through buying up properties

from smaller landlords who were likely to exit the sector.

Increasing rents was discussed as a likely scenario:

“[I] imagine it is going to substantially raise our tax bill at the end of the year … we haven’t put up our

rent in the whole time …those tenants have been in there … but if it starts to financially impact … into

our personal pockets, yeah, we might have to relook at the level of the rent … which would sadden us,

because the way things were we were ticking along sort of okay, we’re not making a lot of money out of

this.” (Peter AKL 1)

‘Disincentives’, especially changes in the tax regulations, had created uncertainty for some landlords with

regard to plans for any further investment in rental property. In John’s words, “I think it’s more of a wait and

see approach” (John AKL 1). However, landlords were differently positioned with respect to the changes, with

longstanding landlords indicating the impacts would be modest.

“Well, we don’t, we can’t claim as much back, that’s about all, other than that we pay our tax on what

we earn from the houses.” (Pauline CHC 2)

“Yes, well yes so because our debt, LVR is actually quite low because we’ve had them for so long, it will

affect us, but it won’t, it’s not going to be as bad as potentially we thought.” (Charlotte CHC 5)

While indicating the changes meant more tax to pay, when asked if it was still worth it, the landlord quoted

below responded:

“I think it still does. It just means it's going to take longer to pay them off, cos we were always going to

have to pay something. We’re just going to have to pay more tax on it.” (Danielle WLG 4)

Diversity characterised landlords’ viewpoints on most matters, including tax changes. While resistance to

recent changes to tax settings was common, Paul’s comments below indicate support for government changes

if they open up opportunities for first home buyers.

“I’m okay with everything they do because there is... they are trying to open up the market to first home

buyers and stuff the speculators and all of that type of stuff so I don’t really mind.” (Paul AKL 2)

The landlords were aware of the difficulties caused by the shortage of affordable housing and when survey

respondents were asked if they had accommodated additional tenants in their properties in response to the

housing shortage, 11% said they had although no details were sought on how this was achieved. Most

landlords also acknowledged that high rents and the difficulties faced by first home buyers were challenging

for many people, however they did not identify their landlord practices as a contributing factor. Rather, other

landlords were seen as acting unfairly by providing sub-standard rental accommodation and/or putting rents

too high. These “unscrupulous” landlords were blamed for the introduction of increased regulation of the

rental sector over things they had mostly already provided in their properties (i.e., insulation, heating, smoke

alarms etc.).

COVID-19 impacts

Minimal impacts of COVID were reported by landlords, apart from not always being able to inspect their

properties during lockdowns. With little change, most landlords were able to continue their communications

via phone and email messaging.

A few landlords said they had offered tenants reduced rents for a period when COVID had impacted their

employment. However, most landlords said tenants had not asked for a rent reduction or ‘rent holiday’ during

lockdowns – mostly because the tenants had been able to continue to work and cover their rent.

Several landlords had properties become vacant around or during a lockdown period and were unable to take

the practical steps required to re-tenant it (e.g., maintenance, viewings) and the properties had therefore

remained vacant during this time.

“We’ve been in lockdown so nobody can come in to view the place or anything like that. So … since July I

think it’s been vacant … we’re just doing a little bit of work on it … but as you know you couldn’t get

tradesmen in either so.” (Prisha AKL 1)

Future intentions

The numbers of landlords intending to purchase additional rental properties dropped between 2015 and 2021,

down from 25.6% to 14.6%. Of the 60 respondents indicating an intention to make a further purchase, the

reasons given were consistent with those reported for their first purchase, with ‘a form of retirement saving’

being the most common response. Reflecting the age of the cohort, the most common reason for not making

further rental property purchases was being ‘too old’ (30.4%), followed by ‘cannot finance’ (21.5%). When

asked a more general question on barriers to investing in rental property, uncertainty about current and

proposed changes to government policy was the most frequent response (37.1%), followed by rising house

prices (31.8%) and access to finance (20%). Conversely, when asked if there was anything the government

could do to encourage them to buy more rental property, a third (32.2%) said altering the tax structure to

make rental investment more profitable, but a higher percentage (39.9%) responded that there was nothing

the government could do.

In light of the rising cost of housing, in 2021, respondents were asked: Have you invested in residential rental

property with others, other than family members? Twenty-two landlords, 5.4% of the sample, said they had.

Intention to sell rental properties was higher (21.3%) in 2021 than in 2015 (14.8%) and change in government

policy was reported as a reason by 29.1% of this group, followed by ‘to cash up for retirement’ (22.1%).

However, most landlords (68.1%) had no plans to divest of rental property. For the 68 individuals who in 2021

reported having sold rental properties in the previous two years, just over a third said they had done so

because they needed the capital for other reasons, with only 11.8% indicating a change in government policy

as a reason for selling. When asked if there was anything the government could do to encourage them to

invest in the rental market again, the common response given by 42.9% of those who had sold properties was

‘no, there is nothing the government could do’.

Discussion

An increasing proportion of New Zealanders are becoming long-term or life-long renters in the private rental

sector (PRS). In parallel, rates of homeownership/owner-occupation have continued to fall since the 2015

tenants’ and landlords’ survey. As private renting becomes the only tenure option for many households, it is

critical to continue to examine how the PRS is, or is not, working for both tenants and landlords – as well as to

push for reforms that ensure renters are able to access healthy, suitable and affordable housing and achieve

‘secure occupancy’. Since the 2015 survey, the introduction of the Healthy Homes Act, amendments to the

Residential Tenancies Act (RTA) and PRS-related tax reforms have had implications for both tenants and

landlords.

As in the 2015 survey, a wide range of experiences and views were expressed by both tenants and landlords.

This diversity was discussed extensively in the 2015 report. The following discussion will therefore focus on

changes and continuities in the data since 2015. It will also reflect on what the data indicate regarding recent

changes to the regulatory environment.

One positive change has been a general acceptance of the Healthy Homes standards by landlords, and survey

data suggest more rental properties are warmer and drier due to this legislation. When asked what they would

do to improve their home/property, adding insulation was no longer the most frequently chosen option by

either tenants or landlords. Another change has been both tenants and landlords indicating they had signed a

tenancy agreement and bonds being lodged with tenancy services, suggesting an increase in the

professionalism of the PRS.

A critical and concerning continuity is tenants’ expression of anxiety and stress due to a lack of secure tenure,

even amongst those who had lived in their homes for a decade or more. As in the previous survey, tenants

commonly expressed feeling ‘lucky’ and ‘fortunate’ to have somewhere to live that was comfortable, warm

and dry and that they could afford to rent. But feelings of being ‘lucky’ sat close to fears of having to move and

find somewhere else to live, with uncertainty around what they would find and an expectation of moving costs

and increased rents. Regular rental practices, such as property inspections, were a reminder that the property

was not really their place

Soaita and McKee (2019, p.148) note a market-based private rental sector ‘confers reduced tenant agency and

frequent, undesired, tenant mobility’, and most tenants surveyed lack secure occupancy (Easthope, 2014;

Hulse & Milligan, 2014). This is problematic for health and wellbeing (Chisholm et al., 2022). While a handful of

longer-term tenants spoke of feeling relatively free to make changes to their indoor living space and/or plant a

garden, other tenants did not. Further, several tenants interviewed were reluctant to request maintenance or

modifications to the property, even if they were covered in the Heathy Homes Act. Tenants had to weigh up

asserting their rights and the use of a legal avenue for redress such as the Tenancy Tribunal with the possibility

of repercussions, such as rent increases or increased inspections.

The end of ‘no-cause’ terminations, automatic transfer of fixed-term tenancies to periodic tenancies and

tenants’ rights to make minor changes to personalise their ‘home’ – all recent changes to the Residential

Tenancies Act – (2020) do offer more ‘secure occupancy’ to some extent. But they do not change perceptions

– and current realities – of renting as a second-class option. The balance of power remains with landlords. For

instance, while technically landlords may no longer terminate a tenancy without good reason, landlords retain

the power to sell a rented dwelling (90 days’ notice required) or move staff, family members or themselves in

(with 63 days’ notice). The fact that it is a landlord’s intentions for the property that dictate the time the

tenant has to find a new home is a telling indictment of whose rights are prioritised in New Zealand tenancy

law.

Unaffordability and a lack of supply continue to undermine the goal of warm and dry homes for all. So do

unresolved maintenance issues or damp, poor quality housing, either through a lack of landlord attention or,

perhaps more commonly, as a trade-off by tenants to avoid a rent increase. While both parties (tenant and

landlord) might see such an arrangement as mutually beneficial, negative health outcomes due to substandard

housing remain a serious issue. This is likely to continue as long as market rents remain unrestricted and high,

or until public housing stock is significantly expanded so that waiting lists reduce and those unable to afford

market rates can be appropriately housed by the state.

While homeownership may remain the goal for most New Zealanders, there is not a linear progression from

renting to homeownership. In fact, the significant number of tenants who had previously been homeowners is

a reminder that unexpected turns affect many people, making the need for affordable and accessible rental

housing all the more critical.

Healthy Homes regulations and amendments to the RTA have far from levelled the landlord-tenant playing

field, let alone prioritised tenants’ rights. Property owners’ rights continue to trump those of tenants, with

rental properties regarded first and foremost as a landlord’s investment, not a tenant’s home.

The Covid pandemic heightened the need for everyone to be not only housed, but to have a ‘home’,

accentuating the importance of both the physical and psychosocial aspects of a dwelling for health and

wellbeing. The pandemic has also exacerbated existing inequalities as the quantitative easing intended to

sidestep a major recession has fuelled house prices, increasing the financial divide between homeowners and

renters. Rental properties remain a store of wealth for the landlord, not the tenant, and soaring house prices

have spilled over into rent increases (Saville-Smith, 2019).

The pandemic has highlighted the need to wind back the framing of housing as primarily a financialised space

and source of equity and reemphasise a secure home as a right. The common expressions of gratitude and

being ‘lucky’ expressed by tenants for being able to afford a relatively comfortable and stable home suggest

NZ’s PRS falls far short from offering a sense of ontological security that could make it a viable long-term

alterative to homeownership (Dupuis & Thorns, 1998). If housing is a right, why then should a tenant be

feeling lucky to have such a basic need met?

Lack of choice in the rental market and the mismatch between the rental stock available and household

formations is an extension of the broader issues of lack of housing supply and affordability in New Zealand

(Opit et al., 2020) and elsewhere (Gurran et al., 2014). Housing supply in recent decades has favoured a similar

typology of larger detached houses that might make financial sense for builders (within the current planning

environment) and be attractive to property investors (influenced by bank lending practices), but which do not

actually align with contemporary housing needs. The consequences of this mismatch were described by some

tenants. In particular, single adults living alone found there were few suitable options available for them to

rent. The typical choice was between trying to find one of the few single-bedroom units available (and

geographically unevenly spread through cities) or needing to flat share with others to reduce the costs of

renting a larger house. While flatting is seen as a normal part of early adulthood, going flatting in older age was

not a first choice for these interviewees and was done out of necessity.

As with the tenants’ renting pathways, the 2021 survey emphasises the diversity of pathways landlords take

into (and sometimes out of) the rental property market. However, ‘as a form of retirements savings’ was by far

the most common reason landlords stated for purchasing their first rental property. Rental housing remains a

doable and attractive investment option. Family matters, including providing current or future accommodation

for family members, were also often to the fore as landlords discussed their rationale for owning rental

property.

It has been argued that much of the recent property investment, at least in Auckland, is speculative, with the

primary motivating factor being capital gains to be realised in retirement (Rehm & Yang, 2020). The 2021

survey indicates that landlords are not only saving for retirement; increasingly, they are retired. Rather than

selling to release capital, landlords are holding on to investment property into retirement with more turning to

property managers to manage the day-to-day running of their rental property. It remains to be seen whether

this signals a change in the rental market, with a growing reliance on professional services to manage rental

properties, as is more common overseas (Martin et al., 2018).

The ‘do-up’ landlords who take on more of the responsibilities of maintaining their investment property

remain a significant component of the PRS in NZ (with second-hand properties often being favoured as

‘cheaper to purchase’). Larger section size, as a key advantage of second-hand properties, has grown in

importance since 2015, perhaps reflecting increasing development potential due to more permissive planning

policies in New Zealand’s larger urban areas (e.g., the Auckland Unitary Plan, National Policy Statement: Urban

Development). There has also been an increase in interest in new build properties by landlords. The temporary

exemption of new build properties from the removal of interest deductibility and the extended bright-line test

for tax liability has potentially been a factor in this shift. New build houses may also be a more attractive

investment for landlords as they are likely to comply with Healthy Homes standards.

The emerging phenomenon of renter-owners as a hybrid renting/property ownership pathway has been noted

previously in the Australian PRS (Hulse & McPherson, 2014; Morris et al., 2021). The tenants and landlords’

study reveals that this phenomenon is also occurring in NZ (James et al., 2021). While some of these renter-

owners could be classed as ‘rentvestors’, pathways into renting and owning proved to be more complex than

simply being a ‘rentvester’. Some of these households were previously owner-occupiers but had become

renters who were now only able to afford to buy a smaller property that did not meet their household needs.

Others were more deliberately using ‘rentvesting’ to get a foothold on the property ladder, while continuing to

rent in a location that better suited their household needs and preferences.

As with the 2015 study, opinions on property managers varied amongst both tenants and landlords. The main

distinction amongst landlords was between those who preferred a more ‘hands-off’ approach and saw

property managers as having the skills and networks to deal with day-to-day issues, and those ‘hands-on’

landlords who preferred to attend to their properties and tenants themselves, and/or save money. While

some tenants spoke of developing a good relationship with their landlord (often not possible when they dealt

with a property manager), others had ‘horror’ stories about overbearing or unreliable landlords, and preferred

dealing with a property manager. Reflecting the costs of engaging property managers, weekly rents on

dwellings managed by property managers were on average $50 higher than for those managed by landlords,

although as noted earlier a number of factors, other than the type of property management, determine rental

cost.

The rental property regulations proposed in the Healthy Homes Act were a controversial subject in the 2015

study. At the time there was political debate over the need for greater regulation of the PRS and the impacts

such regulation might have on tenants and landlords. However, in the 2021 survey cohort of landlords these

concerns have mostly been allayed. Most landlords now saw Healthy Homes standards as either benign (since

their properties were already ‘up-to-scratch’) or as a necessary layer of protection for tenants against ‘bad’

landlords. Although it was the first time the question was asked in the surveys (so comparisons cannot be

made with 2015), almost all landlords (94.4%) thought there was a link between someone’s house and their

health. When asked the same question, only 83% of tenants agreed, while 10% did not think there was a link –

perhaps suggesting a lower level of knowledge around housing issues amongst tenants.

The attention of landlords has switched to the recent amendments to the Residential Tenancies Act and tax

reforms. The end to ‘no-cause’ terminations and tenants’ new rights to make minor modifications to their

rented dwellings were a concern to some landlords. They felt the amendments had shifted the balance of

power too far toward tenants, and that they would be powerless to prevent property damage or evict bad

tenants. Moderating these concerns were landlords’ reports of positive relationships with their tenants.

While responses to the RTA amendments were mixed, tax law changes, intended to incrementally remove

some of the incentives to property investment that landlords have previously benefited from, were of greater

concern. Opposition has been voiced by property investor associations against the moves to curb investment

in housing for capital gain and reduce incentives for investing in property. Landlords interviewed also voiced

concerns. The popular distinction between being a ‘property investor’ and a ‘ma and pa’ landlord was often

implied in their responses. Many landlords with smaller portfolios believed they were not the problem and

were being unfairly targeted. They argued these policy changes would only shift property ownership to

investors and corporations with larger portfolios. Conversely, landlords with larger portfolios claimed they

were running a business just like any other and should not be singled-out.

It was anticipated that a range of factors related to the COVID pandemic would have impacted the PRS.

However, interviews with tenants and landlords suggested the ‘rent freeze’ was not particularly influential on

renting experiences, although jumps in rent soon after the freeze ended were reported by tenants. The survey

detected lower rates of tenant turnover in the prior two years, possibly, in part, because of the constraints on

tenancy terminations and the generally restricted nature of the housing market during this time. For example,

the number of tenants moving due to the landlord having sold the house was lower than in the 2015 survey,

which may have been partially due to the difficulty of selling houses while in lockdown.

The COVID pandemic and lockdowns also impacted data collection. While the landlords’ survey was completed

without direct impact from the lockdowns, a methodology change was required for the tenants’ survey, which

was moved online, with the modification of some and the removal of other questions. Consequently, while

good comparisons between the 2015 and 2021 landlords’ surveys can be made, the potential to make similar

comparisons for the tenants’ survey is more limited.

Another consequence of this change in methodology was that young renters were less well represented in the

follow-up in-depth tenant interviews. One of the drawbacks of the change in methodology from CATI (with

recruitment via landlines and mobile numbers) to an online survey was being unable to collect participant

contact details for follow-up interviews. Consequently, interviewees were drawn from a pool of participants

contacted earlier through landline and mobile numbers and this likely raised the average age of participants

who took part in the in-depth tenant interviews.

The generally positive experiences reported by tenants and landlords in the PRS should not be considered fully

representative. If there are indeed unreliable tenants and unscrupulous landlords, they are less likely than

‘good’ tenants and landlords to wish to take part in the survey or be interviewed. Thus, the generally positive

narratives presented in this report should be judged in this light and it cannot be assumed that the PRS is

necessarily working well.

There remains a troubling disconnect between the widespread aspirations for homeownership, high and

increasing rents, and an entrenched lack of affordability. All households need to be homed as well as housed,

whether they own or rent a dwelling. A fundamental reconceptualisation of housing is required to address the

conflict between housing as an investment mechanism and housing’s value being as a home providing shelter

and protection.

The New Zealand Government continues to focus its attention on making homeownership more attainable,

primarily through loosening planning regulation and redeveloping Crown land to increase supply. But

increasing housing supply does not resolve the needs of renters for secure occupancy. Long-term and life-long

renting is a reality for a growing proportion of New Zealanders. While homeownership may remain the

aspiration of the majority, for many, long-term renting is the only tenure option available. This reality must be

confronted in the form of policy reform that strengthens tenant rights, prioritises their needs, and transforms

renting into a healthy, affordable and secure form of tenure, not just for the ‘lucky’ few, but for all New

Zealanders in rental accommodation.

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