Capital Gains Tax
Today the Tax Working Group will be releasing its report on a number of matters in relation to taxation, including proposals around how capital gains should be applied in New Zealand.
REINZ will be releasing commentary around the report.
Case Update: Failure to provide Insulation Statement
The issue in this case was whether the property manager breached their obligations under section 13A(1A) of the Residential Tenancies Act by failing to include an Insulation Statement with the tenancy agreement.
Obligations
In accordance with section 13A(1A) of the Act, a landlord must include in the tenancy agreement, a signed Insulation Statement disclosing the extent to which the premises have been insulated. The Insulation Statement must inform:
- Whether or not any insulation is installed in connection with any ceiling, floors, or walls that are at the premises; and
- Details of the location, type and condition of all insulation installed.
If the landlord is unable to provide the relevant information, they must explain why and that all reasonable efforts have been made to do so under section 13A(1B) and 13A(1C).
If these obligations are breached, then the Tenancy Tribunal may award exemplary damages of up to $500 under section 13A(1F).
Facts
The tenants (mother and daughter) entered into a fixed term tenancy on 25 July 2018 and was set to end on 24 July 2019.
On 29 August 2018, the tenants served notice on the property manager with the intention of bringing the tenancy to an end. The tenants reasoning behind the early termination was that they had not been informed that the premises had no insulation and that the mother’s health had deteriorated since residing in the premises.
The property manager failed to provide the Insulation Statement with the tenancy agreement however, stated that it was an oversight as opposed to it being a part of their standard policies and procedures. The property manager then provided an insulation report that noted that the insulation could not be assessed and an unsigned email from the owner recording work that was completed.
The tenants had stated that if the Insulation Statement had been disclosed to them then, they would not have entered into the tenancy agreement.
Finding
The Tribunal needed to determine whether, if the property manager had provided the Insulation Statement, the tenants would have entered into the tenancy agreement.
The tenants provided medical notes stating that the mother was living in a “very cold house” and Tribunal found this to some degree proved that the tenants felt the need to end the tenancy because of the negative effects of the cold on the mother’s health.
The Tribunal found that the property manager had committed an unlawful act by not providing the Insulation Statement and therefore, the onus was on the property manager to prove that the breach did not mislead the tenants into entering into the tenancy agreement.
The Tribunal found that the property manager had not discharged this onus as the report stated that it was not possible to assess what insulation was installed and the email from the owner was unsigned and undated. The Tribunal however, acknowledged that there was no improper intent on the landlord’s part and that it was simply an oversight.
The letting fee, filing fee and break fee were refunded to the tenant and exemplary damaged were also ordered.
You can find the full decision here.
Case Update: Does the 42-day termination notice meet the exception?
The issue in this case was whether the 42-day termination notice met the exception under the Residential Tenancies Act 1986, where the property is required for a family member to move in.
The tenants were a daughter and mother pair although, the mother never resided at the premises. They rented the back unit while the landlord and his wife resided in the front unit.
Was the termination notice unlawful?
Under section 51 of the Act, a tenancy can be terminated by a 90-day notice without giving a reason. There are three exceptions under section 51(1) of the Act where the landlord can give 42-day notice instead. The landlord can give shorter notice if:
- The landlord or a member of the landlord’s family is going to live in the property
- The property has been sold and the buyer does not want tenants
- The premises are required for occupation of an employee
On 09 October 2018, the landlord served a 42-day notice to end the tenancy on the basis that a family member (his son) was moving in to the unit. The landlord stated that him and his son who resided in Invercargill were discussing a potential move to Rotorua where the landlord lived. During the notice period, his son informed him that he would not be moving up anymore as a result of a job promotion.
Findings: The Tribunal stated that the owner must know the timing of when the family member will move in. They stated that the job prospect was mere speculation and there was no certainty of a shift. The Tribunal found that the notice was unlawful and that the landlord had insufficient grounds to use the lesser period of 42-days’ notice.
The tenant claimed compensation for the period she would have been able to remain in the premises had she been given the 90-day notice. She stated that she faced significant stress when served the notice as she was heavily pregnant and had driving charges against her and to avoid imprisonment, she needed to have a known place of residence for a sentence of home detention.
The Tribunal stated that compensation was awarded for losses flowing from a breach that was reasonably foreseeable. They stated that it would have been obvious to the landlord that the tenant was heavily pregnant and would be put in an unnerving situation as a result. Compensation was awarded for this loss however, not for the driving charges as this was not reasonably foreseeable.
It should be noted that the tenant had also claimed that the landlord had interfered with her right to reasonable peace, privacy and comfort of the premises. The Tribunal found no breach by the landlord.
You can find the full decision here.
REINZ and Real-iQ deliver the NZ Certificate in Residential Property Management
Lift your professionalism and standards and prepare yourself now for potential industry regulation.
Click here for more information.
Commission Statements
Whilst the law does not prescribe a set format for commission statements, we recommend that members provide commission statements that detail the amount of deposit paid, a breakdown of the commission calculation, GST and net balance due, to enable the vendor and/or their lawyer to check the commission calculation in a convenient way.
The New Zealand Law Society has expressed concerns to REINZ that some agencies have reverted to the practice of providing commission statements that simply list the deposit paid, amount deducted and net payment.
Providing a good service includes being transparent and making it easy for vendors and/or their lawyers (as the vendor’s representatives) to check that the commission was calculated correctly and in accordance with the agency agreement. The law does not prescribe a set format for commission statements but a best practice statement would set out information in the following format (the percentage amount is an example only):
The New Zealand Law Society has also requested that agencies provide, where possible, the commission statement to the vendor and/or their lawyer before releasing the deposit, to enable checking of the intended payment to occur before funds are released.
Verifiable Training
Christchurch Verifiable Training
Wednesday 6 & Thursday 7 March
Registration deadline Thursday 28 February - a $50 per person late fee will apply after this date.
Queenstown Verifiable Training
Wednesday 20 & Thursday 21 March
Registration deadline Thursday 14 March - a $50 per person late fee will apply after this date.
REINZ welcomes back Tom Panos
Modern Agent 2020! Wellington - Friday 17 May - Check out the poster
Note: Tom will also be presenting in Christchurch in 2019 - Info to come
REINZ presents the Anti-Money Laundering Roadshow - Part 2!
Practical, hands-on and detailed training. New Plymouth sessions have now been added!
Find your suitable session and book now.
Fresh Starter Auctioneering Course
A 2-day training course suitable for those who have called under 10 auctions or none at all!
An interactive, fun and lively session for those who want more practice and training that will also add 7.0 non-verifiable hours. Book now
Verifiable Dates for 2019
| Region | Dates | Location | |
|---|---|---|---|
| March | |||
| Christchurch 1 | 6 - 7 | The Atrium | Book Now |
| Queenstown | 20 - 21 | Mercure Queenstown | Book Now |
| April | |||
| Auckland 1 | 3 - 4 | Events on Khyber | Book Now |
| Wellington/Lower Hutt | 10 - 11 | Lower Hutt Events Centre | Book Now |
| Dunedin | 10 - 11 | Edgar Centre | Book Now |
| May | |||
| Thames | 1 - 2 | Thames Civic Centre | Book Now |
| Whangarei | 8 - 9 | Northland Events Centre | Book Now |
| New Plymouth | 15 - 16 | Novotel | Book Now |
| Hamilton | 29 - 30 | Workingmen's Club | Book Now |
Sector Events
South Island Rural Seminar
Tuesday 26 March, 10am - 2.30pm
REINZ is returning to West Melton on Tuesday 26 March for a four hour South Island rural seminar the day before the start of South Island Agricultural Field Days in Kirwee.
Join MC Paul Cunneen to listen to a range of speakers deliver bespoke content to the rural sector. A panel of successful rural & lifestyle agents will share their vision on how to ‘Get your rural business engaged for the new financial year’.
Enjoy this unique networking opportunity with wider colleagues and other brands and earn 4.0 non-verifiable hours.
Commercial & Industrial Breakfast
Wednesday 10 April, 7.30am - 10am
REINZ is excited to have Rod Marler (Panuku Development Auckland), Stephen Selwood (Infrastructure New Zealand), Chris Cunniffe (Tax Management New Zealand) Cameron Bagrie (Bagrie Economics) and Lisa Gerrard (REINZ) speaking with us for our 2019 Commercial and Industrial Breakfast held at the Maritime Room, Auckland.
Sporting Events
REINZ 16th Annual Fishing Tournament
Friday 1 March, 8am - 5pm; Weigh-in 3pm - 4pm
Auckland Sailing Club, 8 Tamaki Drive, Auckland
Partnered with Property Press, this is gearing up to be a great day with spot prizes and $2,250 worth of cash prizes up for grabs!
The registrations for the 2018 REINZ Fishing Tournament are now open and you can purchase all tickets online through Eventbrite.
Please feel free to send this link through to any others that you know may be interested in the competition. Friends, family and clients are all welcome to join, but please ensure that everyone is registered.
Book those charters now and come and enjoy a fun, competitive day on the water!
If you have any questions, please get in touch with the Events Team
| March | |||
| REINZ Annual Fishing Tournament | 1 March | 8am - 5pm | Auckland Sailing Club |
| South Island Rural Seminar | 26 March | 10am - 2.30pm | Melton Estate, Christchurch |
| April | |||
| Commercial & Industrial Breakfast | 10 April | 7.30am - 10am | Maritime Room, Auckland |
| June | |||
| NZ Auctioneering Championships - Draw | 23 June | 5.30pm - 7.30pm | REINZ, Auckland |
| NZ Auctioneering Championships - Heats | 24 June | 10am - 5pm | REINZ, Auckland |
| NZ Auctioneering Championships - Finals | 25 June | 10am - 6pm | REINZ, Auckland |
Introducing the Map Label feature in REINZ Statistics
The Map Label feature enables you to see relevant information on the map.
Use the Labels to identify and select property information in your area such as:
- Bedrooms
- Land area
- Owner's name
- Time since last sold
- Sale method
- Selling agency
Try the REINZ Statistics Platform now!
Digital Product Training
Wednesday 27 February
Enhanced Statistics, 10am - 11am
PropertySmarts, 11.15am - 12.15pm
Thursday 7 March
eForms, 10am - 11am
FlexiSign, 11.15am - 12.15pm
Nominations open for Regional Director - Region 4 (by-election)
Due to the early retirement of incumbent REINZ Director, Jim Davis, nominations are now sought for the position of REINZ Regional Director – Region 4 (Nelson, Marlborough, Canterbury and West Coast). The new Director will serve on the Board from the end of March 2019 until the end of the 2020 REINZ Annual General Meeting (approximately 20 months).
Nominations must be submitted to Lisa Gerrard on the Regional Director Nomination Form. Nominations must be received by 5pm, 28 February 2019.
If more than one nomination is received, the election of the Regional Director will be held by electronic ballot in accordance with Rules 7.4 and 12.3. The ballot will open on 12 March 2019 and close on 20 March 2019. Voting instructions will be provided in due course.
The full by-election process can be found here.
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Bindi Norwell is taking part in the Auckland City Mission CookOff this March, to help prepare a meal for 200 families in need.
The Auckland City Mission has set a goal for Bindi to raise $10,000 to go towards their ongoing emergency food packages. We would sincerely appreciate any support you can offer by donating here.
REINZ works in partnership with NetYourJob recruitment to provide maximum industry coverage when you’re looking for real estate staff. NetYourJob can provide REINZ Members with competitive marketing rates for job advertising. Contact NetYourJob on 0800 638 968 to find out more or click here to view new jobs this week.
