Easy solution to landlord’s threatening rent rises as a response to Labour cracking down on speculator tax loop holes

By   /   May 15, 2017  /   49 Comments

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Long term low rent accommodation is the solution, allowing the corporate greed monsters of Barfoot and Thompson to just graze on the fields of inequality while those with little get pushed to the fringes is not a solution.

Landlords threaten rent rise for Labour reforms

Landlords are threatening to push up rents in reaction to Labour’s new rental sector tax policy change.

Andrew King, NZ Property Investors Federation executive officer, said there was no doubt rents would rise nationally if policy announced by Labour leader Andrew Little was introduced.

There is an easy solution to landlord’s threatening rent rises as a response to Labour cracking down on speculator tax loop holes – renter rights.

This is the new story that tells us everything we need to know about the drive to push rents up…

Barfoot and Thompson director Kiri Barfoot said they regularly reviewed rent prices.

They were in the business of pushing up rental prices for the landlords, Ms Barfoot said.

“Maybe we’re more proactive than someone who looks after [properties] themselves and just wants to get tenants in and doesn’t realise they can [increase rents].”

She said the 4.6 per cent increase in rent in the Auckland area was “modest”.

So Barfoot and Thompson are constantly hounding their clients and playing to their greed to artificially ramp up rent prices? The Free Market at it’s most pathologically ruthless.

How Charming.

We seem to have a system that only benefits those renting the property out. The ability to constantly push up rents due to desperation only entrenches the poverty of those locked into renting get caught on.

Our communities need diversity. State Housing and housing affordability for the poor needs to be seen as a civic obligation, not a slum lord pay day.

Families who can put down roots into their communities is essential for those communities to thrive, if the entire structure of the free market rental environment is built for property speculators, is it any wonder inequality is such a wound on our GDP?

A Landlord can just give you 42 days written notice to evict you if a family member wants the rental, a loophole large enough to be able to drive a truck through.

Closing the tax loop holes that Labour are suggesting has been met with hostility by those abusing the current system and promises of higher rents, the response should be renters rights.

We require new law cementing in long term tenancies with rent controls and the promotion of ‘ethical landlords’, people who refuse to squeeze every last drop of money out of their tenants for needless greed.

Long term low rent accommodation is the solution, allowing the corporate greed monsters of Barfoot and Thompson to just graze on the fields of inequality while those with little get pushed to the fringes is not a solution.


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  1. bert says:

    Yes, just read this in the Herald. More threats to keep the greedy, greedier.
    The irony here is Andrew King, NZ Property Investors Federation executive officer, only mandate will be to look after the interests of investors to make more profit.

  2. Wensleydale says:

    “Maybe we’re more proactive than someone who looks after [properties] themselves and just wants to get tenants in and doesn’t realise they can [increase rents].”

    This is what bothers me about (some) real estate agents, and property managers especially. They will continue to encourage landlords to increase rents, despite the fact the landlord may not need, or want to increase rents. But they’ll do it anyway, then they’ll go home and watch people living in cars and mould-riddled hovels. And then they’ll go to work the very next day and once again encourage landlords to increase rents. Does it occur to them, I wonder, that the landlord is well aware they CAN increase rents, they just choose not to? Because they’re not grasping parasites intent on sucking the life from their fellow New Zealanders until they’re left withered, wretched husks devoid of both hope and happiness.

    “She said the 4.6 per cent increase in rent in the Auckland area was “modest”.”

    Modest? That’s all well and good, Ms Barfoot. But when your wages vacillate between paltry and meagre, modest is often a bridge too far.

    • Mike in Auckland says:

      You will know that real estate agents, and it is them who are mostly also working as ‘property managers’, tend to get COMMISSIONS. So with every new rental signed up, with every rent increase, I suspect that many of them also get a percentage or total sum amount of a commission or bonus paid to them by their employer (B+T, Ray White, or whosoever it is).

      Some tenants also get property inspections every three months, I hear, which is ridiculously frequent and borders on harassment or breach of privacy, but the property manager will of course charge the owner for this, and thus earns fees for the employer or him- or herself.

      These costs for the owner and landlord can then also be used in their tax declaration, so they will reduce the gain called profit, and that will for some result in lower taxes and even lower tax rates, if they are smart. A win win for owners, landlords, property managers and agents.

      B+T and Ray White and others also try to influence landlords to sell their property, at times, so they can earn commission on the sales. It is close to being a racket what goes on in property business in NZ Inc., it is a disgrace and makes tenants live in homes that they are never really able to enjoy, as the frequent inspections sends the message, you only live here on limited time, my friend. At the same time they pay ever higher rents, leaving little to enjoy the rest of life from.

      But I see and hear nobody take action to change this total BS.

  3. Mike in Auckland says:

    Yes, a change in the Residential Tenancies Act should have been part of Labour’s announcement, same as an expansion of ‘Kiwi Build’, with added on more state and social housing investment and construction.

    Sadly Labour have only been offering to tinker around at the edges again.

    In New Zealand a landlord only needs to give a 60 days notice to increase rents, and the landlord can do this twice a year:

    ”Residential Tenancies Act 1986′ :


    Section 24 – Rent increases:

    “(1) The rent payable in respect of any tenancy may be increased by the landlord provided all of the following conditions are complied with:
    (a) the landlord shall give the tenant notice in writing of the increase; and
    (b) that notice shall specify the amount of the increased rent and the day upon which the increased rent shall become payable; and
    (c) the day upon which the increased rent shall become payable shall be not less than 60 days (or, in the case of a boarding house tenancy, not less than 28 days) after the date on which that notice is given; and
    (d) the rent shall not be increased within 180 days after the date on which the last increase took effect; and …”

    Note: There are NO rent controls in place in New Zealand, while many countries in Europe, even states and cities in the US and other places, have ceilings that limit rent increases per annum.

    New Zealand is very “liberal” in allowing landlords to increase up to the existing MARKET RENT. And that is determined by the rents charged in recent tenancy agreements entered into. It is similar to the house price escalation we have, as valuation is based on recent sales prices, not on sales over a longer historic period. If the landlord may have a good enough reason, they may even get away with higher increases going above market rent.

    So an increase can easily be ten, twenty or more percent, should the ‘market rent’ increase significantly, as it has for many in places in Auckland, and some other cities and regions. It is time we follow other developed countries and put in place maximum increases based on say nothing more than five percent per annum, or based on a ceiling that is not simply looking at the present market rent! Labour have so far not shown the courage to do this, nor are they hinting to expand on Kiwi Build or on state housing supply plans.

    This is how bold property investors and their agents and trainers can behave themselves in NZ Inc. these days:

    ‘Auckland property investors urged to target deceased estates, ‘dummies’ and ‘divorcees’

    NZ Herald, 06 May 17:

    “Property investors are being encouraged in a tutorial video to exploit the “seven Ds” – which include targeting “deceased estates”, “divorcees” and “dummies” who don’t know the real value of their home.

    The advice has “appalled” the country’s largest bank which is now reviewing its sponsorship of the organisation that distributed the video, Auckland Property Investors Association (APIA), and its national body.

    The video by Auckland property tycoon Ron Hoy Fong titled How to make massive profit in today’s property market says “desperate” homeowners forced to sell cheaply before banks step in are also prime targets.”

    ‘Investors boss says buyer tactics commonplace among property investors’

    NZ Herald, 11 May 2017:


    “A property investors boss and magazine publisher says controversial buyer tactics like targeting deceased estates or homeowners with money troubles who need urgent sales are not new and have been used by investors “forever”.

    “Often the best deals are around mortgagee sales, deceased estates, people who got into financial difficulty and have to sell, and that’s standard,” said NZ Property Magazine publisher Philip Macalister.”

    Other ‘stuff’ on this:
    ‘Who’s getting rich from the property market?’


    “The winners include investors, real estate agents, property coaches, specialist lawyers and software developers, all of whom usually make good money when the market swings up.”

    These are the kind of guys laughing at all us renters and sellers of homes:

    Mr Ron Hoy Fong, controversial property investor trainer:

  4. Mike in Auckland says:

    If we allow the market to operate for those that are still able to “participate” in it, which is a twisted logic kind of market with high immigration continuing, more and more owners and renters will be shut out of the market.

    The extortionist type rent increases many now face in Auckland will result in more homeless, overcrowding, in cramped, unhealthy and stressed living conditions for the poorest, and in less remaining money of all to be spent on consumption of goods and so forth.

    That will seriously affect the rest of the economy.

    Labour needs to do much, much more than tinker around the edges to raise a hypothetical additional 120 to 150 million in tax revenue through closing so-called “loopholes”, that will not solve much, especially if that will lead to rent increases for tenants.

  5. andrew says:

    Your ideology is getting in the way of reality.

    Please check out these facts:


    • Since when have you been so concerned about facts, Andrew?

      • Mike in Auckland says:

        Haha, Kiwiblog and “facts”, actually more wishful “alternative facts” and fiction, than the true state of affairs:


        The problem is the market gets the wrong kind of incentives, that is it caters only for the ones who can pay, and can pay maximum prices, and builders often just build what can sell quickly and for a good gain, that is larger homes for those who want and pay for it (new immigrants and returning Kiwis with a sound bank balance, coming in from overseas).

        I could tell you more, Andrew, silly bugger, I have studied this subject over recent years, and your comment is BS, so Frank raises a valid question.

        The only way to deal with the catastrophic situation we have now is through firm, resolute and large scale state intervention into the market.

        • Funnily enough, Mike, the housing crisis (which wasn’t a “crisis” six years ago) was one of the very first things I blogged about:

          “Can we do it? Bloody oath we can!”

        • Andrew says:

          Yeah, intervention in the market – that has a great track record 😉

          If you undermine the ability of landlords to make a reasonable profit, there will be less rental accommodation available.

          It’s that simple.

          As regards Labour’s housing policy, I have a few questions:

          Where will they build these 100,000 houses?

          How will they get them through the council consenting process when private builders cannot?

          How will they make them less expensive than current building projects?

          • Mike the Lefty says:

            So where is all the affordable housing that National (repeatedly) promises going to be built then?

          • Mike in Auckland says:

            What is a “reasonable profit”, Andrew? Must everything always be done for a profit, would you expect your emergency doctor ask you to pay by EFTPOS before you get a heart operation that is needed to save your life?

            Housing is a basic need, and profit making should be limited for those that are in the business of making a business out of providing it.

            • Andrew says:


              A reasonable profit is one where the skills, effort and risk are commensurate with the reward.

              No I don’t expect to pay that emergency doctor by Eftpos before my heart operation, but she expects to have a sizeable income based on the number of years she’s trained for the role and her manual dexterity. I wouldn’t begrudge her a Porsche, if it floats her boat.

              Incidentally in my life I’ve seen far more damage done by charity than profit seeking.

              • Mike in Auckland says:

                “A reasonable profit is one where the skills, effort and risk are commensurate with the reward.”

                Oh yeah, I met a fair few real estate agents, property investors and worse even property “managers” who I found out had stuff all (zilch) in the way of ‘skills’, who made NO effort and had a fairly low risk to face, as they were IN CHARGE and placed unreasonable demands on tenants, who were paying rents that left little for food.

                I met salespeople telling lies, misleading buyers about existing risks and flaws with buildings they sold, who earned huge commissions, without doing much at all.

                So NO profit is my answer, such people and virtual blood suckers do NOT deserve any profit, they should get a proper job and make or serve real things.

                • andrew says:


                  Real estate agents have well deserved a bad reputation – almost as low as journalists in fact!

                  But this is a red herring. The topic on landlords, the vast majority of which are people who have one renter and have saved and worked hard to establish that investment.

                  Thee are the people Little is attacking.

                  • Mike in Auckland says:

                    I thought that it would not affect those that only have one rental property!

                    See this, you are again misleading readers here:


                    “The biggest users of this loophole are large-scale speculators who own multiple rentals and use losses on new acquisitions to continually reduce their tax. The speculators’ tax loophole helps them outbid home buyers for properties because the taxpayer effectively subsidises part of their cost of servicing mortgages.”

                    “Ending this loophole will not affect most people who have bought a single rental as a long-term investment, because most of them are not using it. Those that do use this loophole generally only do so for a few years after purchase.”

              • countryboy says:

                @ ANDREW. Just like your cohorts. A seeping bag of brainfarts and bullshit.
                The Right Wing would have nothing to say ( I dream of such a thing. Would that be the end of all boredom? ) without the ignoble logical fallacy.

                Building a house @ $3 k a sq m? ( Which is absurd in its own privateering way )
                So, whom do you borrow from to etc to build yourself into a debt tomb for life?
                The Banks.
                Every NZ woe spins back to the dirty banksters and their well lobbied, Right Wing windbag politician cronies.

    • bert says:

      Kiwiblog, jesus Andrew, you probably think Whailoil is The Prophet!

      Here are “the facts”…



      Just two of the reputable sites, Radio NZ and The Listener.

      And as an aside here are more facts created by National…


      • CLEANGREEN says:

        Andrew is deranged and completely off the bio on this one.
        Just look at the carnage in human terms ow, Poor living in cold unheated un-winter-ised steel sided sheds in Auckland paying $300 a week!!!!

        Dream on mate and we hope you dont wind up in one when you may fal on bad times.

      • Andrew says:

        Thanks for the links Bert. I read them all.

        It’s hard to disagree that there is a problem in the Auckland housing market for first time buyers.

        However, in order to fix the problem we need to understand the causes. These are the factors that have driven up the market to unreachable levels:

        1. Historically low interest rates.
        Nothing we can do about this as it’s a global phenomenon, but it does seem as if we’re seeing the start of rate rises. Will the folk who are claiming a crisis now be claiming the next crisis when we have maybe a couple of percent interest rates and house prices are in free-fall?

        2. Returning Kiwis
        Nothing we can do about this either. My office in town has been repopulated by Kiwi professionals out of Aussie and the UK. They have all come with savings and have acquired homes for a million and over. These returnees are about half of total migrants at the moment but this is a transient issue: There are only so many Kiwis to return and when things start to brighten up in Aussie many may leave again. In this regard National is condemned by its own success – 25,000 kiwis were leaving for greener pastures during the Clark era 😉

        3. Auckland council
        Post the super city amalgamation we have seen zero leadership from the Council on housing. Only now after 8-9 years do we have a regional plan and its still not working. We had that clown Brown talking about high density suburbs when the infrastructure requires an injection of many billions of dollars to support wastewater management for the existing population, let along more!
        Most of the house price rises could be eliminated in a single stroke by removing the artificial urban/rural boundary. It would instantly undermine the ‘land bankers’ and reduce land prices.
        The consenting process is a disgrace and this too has had a major impact on house prices.

        4. Foreigner investment
        This was a factor last year but the investors are now out of the market. I know several large investment properties which aren’t selling and vendors are being forced to come down ~ 150K to get a sale.
        The market has already topped.

    • Once .... upon a time says:

      Andrew – you seem to have entered the wrong door. The bubble you want is the NuZull equivalent of the Sean Hannity Fair and Balanced No Spin Zone. Once it has all turned to shit though, there’s a ticket clipper’s fee to backtrack (which of course under the ideology you’ve signed up to) is reasonable.
      But first, you’ll need to pass some simple tests and Alfred Ngaro will be at the door to ensure you bow your head and ensure you show some respect as you go to Monopoly Start.
      And of course there’ll be some pre-reqs – like being of WASP heritage, AT LEAST of 2nd Generation Nu Zullner status, and NOT of “low quality” or “low value” or a queue jumper or an illegal.
      You might even have to prove whether you wear briefs or boxers and not mind if Alfred’s mates sniff your partner’s pantie draw (it’s not Nanny State though – that’s for golden shower heads

  6. Peter Sumpter says:

    Rents can not rise as a result of tax changes or rental WOFs. This is just alarmist threats by Bill English and the Investors.
    Landlords can and do only charge the highest rent that the market willl allow.
    If they could raise rents at will they would have done it already.
    However, raising the accommodation supplement will result in almost instant rent rises because more money is available to pay rents.

  7. Stephen says:

    Just when I thought the left couldn’t get any more stupid they then come up with this policy. I know simple economics is hard for those who believe Marxism can actually work but it is common business practice to offset loss in one area to a profit in another.
    What will happen is that rents will go up now that a loss can not be written off. A landlord makes his profit from the capital gains of the property not the rent.
    What the left should go after is people who live off trustfunds as those people don’t actually work plus dead beat dad’s thar skip child support payments.

    • AB says:

      “A landlord makes his profit from the capital gains of the property not the rent”
      But often the rent is used to pay off the mortgage – so really the renter OWNS that portion of the house they paid for, and should get a commensurate chunk of any capital gain on sale.
      This would certainly persuade landlords to keep rents down.

    • Mike in Auckland says:

      “A landlord makes his profit from the capital gains of the property not the rent.”

      So why increase the rent then, are you not contradicting yourself then?

  8. Historian pete says:

    To stimulate the economy and to stop inflation the reserve Bank reduces interest rates.Those with savings in fixed deposits are robbed.The banks lower mortgage interest rates so allowing more people to buy homes,and those with existing homes to upgrade. Immigration is increased for “growth’ and the housing market gains momentum..House prices start rising with the new demand,and so do rents.New home buyers miss out,and speculators thrive.Banks get cheap money from Western countries quantitative easing.They dont need NZ fixed depositors any more.Tenants can not pay the new rents,or can with great difficulty.More tenants get the housing supplement which is a boondoggle for landlords as they get more rent and so can afford to further leverage their properties to buy more.The housing supplement is paid for by general taxpayers,so it is a subsidy[socialism ] for the landlords and capitalism for everyone else.
    And so the rentier class become more and more wealthy.Long term we are heading for medieval inequality.If you live in a carpark or are homeless you are there already!

    • Andrea says:

      “The housing supplement is paid for by general taxpayers,so it is a subsidy[socialism ] for the landlords and capitalism for everyone else.”

      The bottomless pit of tax-payers’ money – and we’re ALL tax payers, including beneficiaries. (GST, fuel excise, and who knows whatall else.)

      Corporate welfare: Working for Families who are employed at below their worth; and accommodation allowance to allow smart and frugal people of ALL ages to buy a rental and ‘get a foot on the property ladder’.

      Do you suppose Labour has turned the corner far enough to bring these rorts to an end?

      Will they also be acting to ensure that the great Kiwisaver, prop for the Clever People who gamble with others’ futures and pensions, actually delivers excellent returns to the investors? (After the hefty management fees are deducted, of course.)
      (So that the Evil Entitled etc Baby Boomers and other trusting mugs can make enough to bulk out the miserable pittance that is a ‘pension’.)

      Or build the economy and the regulations strongly enough so people don’t lose all their hard-earned savings because of the speculations of those Clever Hardworking little Millenials and other fables.)

      And the pigs are fed and ready to fly…

    • CLEANGREEN says:

      100% Pete.

  9. John Hutcheson says:

    How about a rent rise tax. Charged at 200% of any rise payment for 2 years, it will take 4 years for any increase to break even. #RentIsTooDamnHigh

  10. Once .... upon a time says:

    Actually, further to my previous, bets on that the battleground from what is referred to as the ‘Centre Right’ is going to be fought by CT and others’ spin lines referring to their opposition being ideologically driven.
    I’ve heard/seen it twice already in the past half hour.
    Andrew, and Hoskins.
    Grubby little Pot accusing struggling Kettle looking for a bit of warmth much? Yea Nah – pull your gold plated cuff links and look/feign authority sitting next to a Fox News bimbo trying her best to be Miss Personality, whilst an entire crew think JESUS CHRIST behind your back, and you probably have 5 hours to midnight.
    Christ they’re gorgeous

  11. Mike the Lefty says:

    If my memory serves me well, landlords have always threatened to put up rents whenever someone suggests something they don’t like. If they had actually done it every time they said it then the average Wellington flat would cost about $100,000 a week to rent, I reckon.
    They are full of s..t, that is why they love the National government.

  12. Farmer Guy Farmer Guy says:

    Loosen up the squatter laws, that would discourage speculators from owning empty houses.

    Auckland and it’s obsession with property speculation is so f””””ing boring !.
    People sitting around the bbq talking about increases in the value of their spec houses get a bloody life!!.

  13. S.Palmer says:

    many countries ie Canada have “rent control”

  14. S.Palmer says:

    canada has rent control

  15. RosieLee says:

    We need to take a close look at the way rental housing is operated in European countries, such as Germany, where property and rental speculation are carefully controlled and have not been allowed to become a part of the whole neoliberal economy. Tenants have rights around the standard of the accommodation and security of tenure.

  16. Strypey says:

    Here in Ōtepoti, a huge amount of the rental housing is taken up by students. Landlords have been putting up the rent every year for decades, despite the fact that the student allowance (and student loan living costs) have stayed pretty much static. Students get $177 in the hand every week they are in study:

    Rents for rooms in the streets around the university, many of them damp, drafty hovels, are getting up towards $200 per room. In other words, the current rate of student allowance isn’t nearly enough to live on, as acknowledged by Steven Joyce:

    This means that instead of being able to focus on their studies, fulltime students are forced to take on part-time work to survive. This helps employers break up what could be secure, fulltime jobs into fragmented part-time jobs, in a city desperately needing more paid work for its permanent population, especially with the recent decision to sack hundreds of workers from the Cadbury factory.

    Who wins here? Not the students, whose ability to get good marks and maintain a healthy work/life balance is heavily eroded. Not the unemployed and underemployed of the city, who could potentially have fulltime jobs if the students could afford to live without part-time jobs during term time. The landlords do pretty well out of it though, as do the rich who get tax cuts with the money saved by not paying student allowances and benefits at livable rates.

    Either the rate paid to people on the student allowance (and other benefits) needs to go up, or rents need to be controlled to keep them under 50% of people’s income. Which is it going to be?

  17. Dave says:

    Mum and dad investors, of which I am one, assembling a few rental properties so we can pay our own rest home fees rather that rely on the government to pay, would be advantageous I would have thought. raising costs for landlords will simply increase rents, there will be less rental accommodation as the more savvy investor knows that commercial property is the way to go.I imagine an increase in rents and less supply is not really what Labour wants. What Labour could do is have a look at overseas investors who by 30 or 50 properties , not the 2 or 3 that most land lords have, These overseas investors can detrimentally affect supply and demand and dont pay much tax here.

    • bert says:

      And if you look at Labours policy on this, this is exactly what they are saying, mum and dad investors won’t be targeted but what is regarded as an acceptable number of investment properties 1,2, 3, 12?
      2 houses at 1 million each should support you in a rest home?

      • Andrew says:

        BERT, you hit the nail on the head

        Referring to the statistics I previously linked:

        80% of landlords own just 1 property. That’s about 104,000 people

        17% of landlords own 2 properties. 22,000 people.

        And the remaining 3% who own more than 2 properties will have them boxed up in company structures which will be untouchable.

        I would also hazard a guess that the majority of these small time landlords will have their assets in family trusts, making them also untouchable.

        So once again we find Labour inventing policy on the hoof without any attention to detail or understanding of how the real world works outside of Wellington.

        • bert says:

          “So once again we find Labour inventing policy on the hoof without any attention to detail or understanding of how the real world works outside of Wellington.”

          Completely baseless nonsense about on the hoof policy because you simply are not inside the mind of Labours caucus, however you have confirmed that National have created this mess that needs addressing.

        • bert says:

          “80% of landlords own just 1 property. That’s about 104,000 people”

          What denomination of these landlords are “resident kiwi’s”?
          What proportion are property speculators shifting money from one country to N.Z.?

          As you know stat’s are only numbers, they don’t show the hidden truth.

          • andrew says:

            Dunno, you tell me Bert.

            By ‘denomination’ you really mean race don’t you?

            Is this the Left today? National Socialists?

  18. Frances says:

    I’m so fed up with that photo and cliched message. Bullshit. So many of us boomers do NOT have million dollar homes and how many would have half a million dollars? Am I missing something here? Was it meant to be ironic? As a boomer I have never had stable fulltime employment despite being well educated (at my own expense). I do not have kiwisaver despite paying taxes for more than 40 years. I rent out my delapidated house because I can’t afford to live in it. I became an economic refugee after the Natz killed my career so I’m living onless than the minimum wage on the other side of the planet. For goodness sake stop this. Yeah, technically I’m a landlord but I have no car, no furniture and no smartphone. I haven’t bumped up the rent beause I think my tenants are paying enough for an aging house. Just put me in a room with anyone who subscribes to that nonsense message about entitlement.