Residential Tenancies Amendment Act 2020 Comes into Force

The Residential Tenancies Amendment Act 2020 received Royal Assent in August and is coming into effect in three-phase process potentially lasting through to August 2021.

What happened to the Residential Tenancies Amendment Act 2020 in August?

Spearheaded by Associate Housing Minister, Kris Faafoi, the Act changes are in his words, “designed to provide a balance between the rights and responsibilities of both tenants and landlords.”

The Residential Tenancies Amendment Act 2020 received Royal Assent on 11 August and Phase 1 of the law changes took effect the following day:

Rent Increases

• Rent increases are now limited to once every 12 months, rather than once every 6 months (180 days).

Transitional and emergency housing

• Accommodation funded by the government or as part of a special needs grants programme for these purposes is exempt from the Residential Tenancies Act.

What law changes do Phase 2 and 3 of the Amendment Act roll-out include?

Of the three phases the Residential Tenancies Amendment Act 2020 is being rolled out in, Phase 2 features the most law changes.

Phase 2 comes into effect on 11 February 2021 and among others, some notable changes include:

Fixed-term tenancy changes:

Unless the parties agree otherwise, all fixed-term tenancy agreements will convert to periodic tenancies when the fixed term comes to an end, the tenant gives a 28-day notice, or the landlord gives notice in accordance with the termination grounds for periodic tenancies.

This change will only apply if the fixed-term tenancy was entered into after 11 February 2021 — the current law will apply for any fixed-term tenancy agreements signed prior to 11 February 2021.

Security of rental tenure:

‘No-cause’ termination of periodic tenancies by giving 90 days’ notice will become an unlawful act. Landlords will have a new set of termination grounds for a periodic tenancy and the required notice periods have changed.

Prohibitions on rental bidding:

Rental properties must be listed with a rental price included. It will be unlawful for landlords to encourage or invite tenants to bid for the rental and in turn pay over the advertised rent rate.

Making minor changes:

Tenants will be able to ask their landlord if they can make changes to the property for the likes of making the property baby-safe or earthquake-proof, for example. Their landlord must not decline if the change is minor. These requests must be responded to within 21 days.

Phase 3 Law Changes for Residential Tenancies Amendment Act 2020

There are two law changes regarding family violence and physical assault that will come into effect by 11 August 2021, unless the Government agrees to introduce them earlier.

Family Violence:

If tenants are subjected to family violence and can provide evidence as such, they will be able to give two days’ notice and leave their fixed-term or periodic tenancy without incurring financial penalty. If they are the sole tenant at the rental property, the tenancy will cease.

Physical Assault:

If a tenant assaults a landlord, rental property owner, a member of their family, or the landlord’s property manager, and the assault has resulted in Police laying a charge against the tenant, the landlord will be able to issue a 14-day notice to terminate the tenancy.

Getting the full picture

If you’re a landlord or tenant, we encourage you to learn more about the law changes and how they may affect you.

Read more about the tenancy law changes.

If you’re still unsure or have questions, please get in touch with one of our team.

Image: Photo by CQF-Avocat from Pexels.