What is a 'large landlord'?
Penalties are steeper for those landlords that own multiple properties.
What is a large landlord and what are the new laws for these types of landlords?
Landlords that have six or more tenancies are in a category of their own known as a ‘large landlord’. For instance, if you split some of your investment properties with a spouse or family member, those will still count towards your total from an “associated person” test.
Why does this even matter?
With the new legalisation, MBIE increased penalties for large landlords.
This allows for ‘pecuniary penalties’ to be made against large landlords up to the maximum of $50,000 for the committing of an unlawful act.
This is different than exemplary damages, which are paid to the other party when awarded. Pecuniary penalties are awarded fines paid to the Crown. A landlord could be up for a double whammy of exemplary damages paid to the tenants plus, pecuniary penalties paid to the crown.
For example, if a landlord didn’t meet healthy homes compliance in their rental properties. The ‘large landlord’ is not only liable to pay exemplary damages of up to $7200 to the tenants, but also the Tenancy Tribunal can order a pecuniary penalty to be paid to the Crown of up to $50,000 for non-compliance.
Therefore, it’s more important than ever that landlords know the rules to avoid significant fines. As professional property managers, it’s our job to know the laws and protect our clients from infringements.
To find out more about pecuniary penalties visit Tenancy Services https://www.tenancy.govt.nz/law-changes/phase-2/enforcement-measures/