The Federation will have an interest in expressing its views and responding to one of the Committee’s terms of reference items and assertion that investors increase the demand for residential properties and to counter various commentators knee-jerk “solutions” such as using tax policy levers to achieve affordability.
The Insolvency Act came into effect on 3 December.
The Act introduces a no-asset procedure (NAP) for first time debtors who do not have cash or assets to pay off their debt.
NAP is promoted as a less punitive process than the normal bankruptcy proceedings.
NAP will be available to individuals with debts up to $40,000, to be used one-time and subject to a period of 12 months rather than the 3 years for bankruptcy.
Whilst the Act does not specifically mention unpaid rent, for landlord creditors, it is likely that there might be an increase in some former tenants using the NAP to escape their financial obligations. Interesting comments to note include the view of the Federation of Family Budgeting Services, who said: “the messages around debt that it sent, and being able to get rid of debt too easily. But we're concerned that a few people may not use it wisely. It may make people be a little less responsible with their debt”.
The Government introduced the Real Estate Agents Bill on 3 December.
The bill replaces the Real Estate Agents Act 1976. It introduces a new regulatory framework for the real estate industry that aims to promote and protect the interests of consumers in real estate transactions by raising industry standards, improving licensing requirements and licensing procedures, providing mandatory disclosure obligations, and providing accountability through an independent, transparent and effective disciplinary process.
There is nothing in the Bill that is of immediate concern or specific interest to the Federation, however in conjunction with members we will monitor any debate surrounding the roles and obligations of letting and property managers. The Real Estate Institute claims a new regime fails to include letting and property managers (they handle millions of dollars a year through their trust funds) and that this “will leave consumers needlessly exposed”.
Submissions commenting on the reforms are due to the Justice & Electoral Select Committee by 29 February 2008.
The Affordable Housing: Enabling Territorial Authorities Bill was introduced into the House on 4 December and referred to the Local Government Select Committee for examination. The Bill enables territorial authorities to determine the level of affordable housing in their districts.
There is nothing in the Bill that directly affects the Federation, however the Bill could affect those property developer members and some landlords with convenants that may exclude affordable housing in some projects.
The Residential Tenancies Amendment Bill has been delayed again and is likely to be introduced from late February 2008 onwards.
The Bill is expected to then be referred to the Social Services Select Committee for examination and written submissions invited by the end of 2nd Q 2008.
According to Statistics New Zealand, property and business services replaced manufacturing as the biggest employer for the first time in the Linked Employer-Employee Data (LEED) series.
Statistics New Zealand said property and business services industry had 238,200 filled jobs during the September 2006 year. The manufacturing industry now has the second largest number of filled jobs 237,000.