Real estate industry needs stronger regulation

When we think of Real Estate agents in New Zealand, people want to think that they are an honourable bunch. New Zealanders want to believe that when they are buying or selling a house, should they deal with a real estate agent, that not only is the person totally qualified to do the job, it will be done to a level of proficiency where both the buyer/seller and the agent are happy.

And why not? A house most certainly is the single biggest purchase in terms of personal financial cost any New Zealand will make, with a few rare exceptions. A house is a substantial and ongoing investment that means one must be prepared to invest time in maintenance, time in possibly occasionally doing the house up, and time in making sure it is not causing the neighbours undue stress. So, one better want a house to be sold to them/or sold on their behalf by an agent who knows what s/he is doing.

For the most part real estate agents are – like most New Zealanders – fairly decent people. They have lives, they might well have family and probably travel ambitions. They do not want to be remembered for all the wrong reasons.

But what happens when there is a rogue in the building. A rogue who has racked up nine misconduct charges; a rogue who poses such a risk that he cannot deal in the real estate industry until 2021, after being banned in 2015?

This is where Aaron Brever comes in. Mr Brever was banned in November 2016 on his ninth misconduct charge. In its ruling the Real Estate Agents Authority said that he was unable and/or unwilling to change and that the public need to be protected by him.

NINTH charge?!

Sorry Mr Brever, but New Zealand needs stronger real estate monitoring regulation than it currently has. It is people like you who are the unfortunate cause of this happening and my promoting it. The Act needs to require all real estate agents are New Zealand permanent residents before they apply for a real estate license. The real estate licencing needs to maintain a standard whereby a client can have confidence in the agent, but at the same time

After nine such charges I think most people would accept an Agent should have been long stripped of his/her license, which should only be reinstated pending appropriate review. I think it would also be appropriate to say that that agent should be permanently barred from being involved in the sale of real estate in any capacity where they may gain some form of financial or other gain should another charge of misconduct be brought against them.

Mr Brever might have been stripped in November 2016. I see nothing to suggest he is credible of getting his licence back.


Housing New Zealand not being restructured – for now

Yesterday it was announced that working income families would get a boost in their wages.To Labour this is a chance for Prime Minister Jacinda Ardern to stamp her mark on a particular topic currently quite relevant in New Zealand as students take off for their summer holidays.

To National it is the breaking of an election promise, according to Stuff writer, Henry Cooke – who  notes shortly further down that Labour had acknowledged that H.N.Z. had made positive moves in the right direction. To Labour it is a sensible but necessary readjustment, something that could have happened with less fanfare, bar for actually seeing on Stuff that this had actually happened.

As far as I am concerned, Housing New Zealand has one job and one job only: to manage the state housing assets in New Zealand. Fair enough, but if we include the other tasks that it was set, the role of H.N.Z. becomes significantly bigger than many think.

It is responsible for 64,000 properties across New Zealand.

I believe it is a state asset that must be 100% N.Z. owned.  Few S.O.E.’s are on this list of ones that must be exclusively New Zealand owned. It should reflect the importance local managers knowing local conditions that non locals will probably not care about, or view as artificial. Rental property companies want to establish a market here – or participate in an existing one – they are welcome to do so, but the house at the end of the day is only for sale to someone who has permanent residency at the minimum.

Of Housing New Zealand stock, none should be for sale to anyone in the first instance. If it is inhabitable whilst complying with the standard of care expected by New Zealand law the most desirable occupant shall be sought.It should not be sold to a foreigner first unless there is a demonstrable improbability of a New Zealander to buy it.

With a hopefully developing waiting list this change in tact will acknowledge the long suffering users of their campers. Some will find it too hard and keep trying to develop alternative solutions – whatever makes for the best reading over the next several days. But for me it is clear. The market failed vulnerable human beings just when they could least afford it.

Which is why I am pleased to see that:

  1. Labour have acknowledged a change in direction from Housing New Zealand
  2. Labour understand that rural communities need support to by their supporting of Housing New Zealand.


The New Zealand social emergency created by National

As we move further into the first term of the new Government, it is starting to become clear that there is a significant crisis in New Zealand society. The issues fuelling this crisis are numerous and varied, and none started on the watch of the recently ousted National-led Government. But in nine years in office these symptoms advanced far enough that combined they now pose an immediate and direct threat to New Zealand society.

National has in effect created a social emergency. The failure to address despite repeated warnings that there were problem emerging with housing, health, social welfare and justice have combined to create conditions where the so called market has left behind sections of New Zealand society whose deprivation is feeding social decay.

The conditions created consist of a combination of contributing factors. They include but are not limited to:

  • Drug addled neighbourhoods with police struggling to contain the epidemic of methamphetamine, synthetic cannabis and other harmful substances
  • Absentee parents/caregivers and a break down of parental/caregiver responsibility
  • Rampant truancy and young people leaving school with no qualifications, and no jobs or training to go to
  • School children living in inadequate housing, constantly having to move and living in conditions that are not compliant with basic human rights or housing law
  • Housing rents eating up money for food, clothes, medical expense – children go to school hungry and/or distracted

The problems start in the home or at school, but often end in a police cell. The following is a brief synopsis of how a person might go downhill. I am not suggesting that all people in such circumstances will experience this – indeed there are many fantastic parents who care very much, who go without themselves and try to be a positive influence in their child’s life, but in socio-economically deprived neighbourhoods, this is a real issue.

In the first instance at home or school, they have no food and often start the day on an empty stomach, are irritable or distracted. A failure to be settled in one spot for any length of time will mean the child has trouble settling in at school, distracted by problems at home. Over time this may fuel other problems, because the student will start getting into trouble, picking fights, associating with the wrong crowd. At home the parent/caregiver might be working long hours to make sure there is enough money to pay rent and will not be at home at critical times such as when they have homework or need underage supervision, so the children start misbehaving. At school the teachers realize that the person or people in question have a discipline problem. Homework is not being done, and the student is disruptive, argumentative. It begins to escalate with children missing school and truancy officers picking them up. At this point, the child is at an intersection in their life. At this stage the choice is stark. The child unless there is substantial intervention by the parent, the school and potentially social social workers will either leave or wind up being expelled from school with poor prospects for the future.

It never needed to be like this. And the long term cost to society, the economy and the people who know the child are substantial. If s/he devolves into drugs, then a life of crime and prison awaits. If s/he tries to turn themselves around their past – especially if a criminal history is involved – may catch up with them and hinder their future development.

This is why there is a significant and dangerous poverty issue in New Zealand. It has the potential to fuel illegal substances, crime, violence and gangs, none of which are welcome or wanted. All of which are horrendously destructive and all of which we need to shut down.

Foreign speculators to be banned from buying N.Z. housing

In one of the first moves of the new Government, today Prime Minister Jacinda Ardern announced at her first Cabinet meeting press conference that foreign speculators would be banned from buying houses in New Zealand from early 2018. The announcement makes good on a promise made during the election campaign to restrict who could buy New Zealand housing, in an effort to cool the market.

This is a promise that has the support of New Zealand First, whose policy platform has long advocated blocking anyone who is not a permanent resident or citizen from buying N.Z. housing.

But the announcement, not surprisingly, has not gone down well with National, whose Finance Spokesperson Steven Joyce said that the announcement itself does not suggest a ban. Mr Joyce questioned whether houses classified as sensitive under the Overseas Investment Act are banned or not. Mr Joyce also questioned whether it would send the wrong signals to overseas investors about investing in New Zealand.

Mr Joyce misses the point. This is as much about social well being and a basic human right, but also the common responsibility of a Government to put the needs of it country and its people first, as it is about the markets, trade or economics in general. This is about addressing the fact that New Zealanders were being priced out of the market by foreign buyers with more spending power.

Ms Ardern indicated that she expects the legislation to be introduced to Parliament before Christmas, to be passed in 2018. She denied it would impact on the New Zealand-South Korea trade agreement or that it would affect the Trans Pacific Partnership Agreement. The latter of which is contentious with Labour allies, New Zealand First and the Greens, both of whom wish to see it abolished completely or NEw Zealand withdrawn.

I welcome this announcement. It is a major step in the right direction for New Zealand housing and the right of New Zealanders to own houses. It is also hopefully the start of a plan to address the disgusting fact that New Zealand has the highest rate of homelessness in the O.E.C.D. National had nine years to address this and other issues brought about by an out of control housing market, and failed to.


The case for changes in Residential Tenancy Act

For a time now I have been of the conclusion that it is time to review tenancy laws in New Zealand with regards to rental properties, the landlord and the occupants. My concerns stem from a combination of reports of irresponsible landlords letting their properties deteriorate whilst still charging full rent, and cases where tenancy disputes have resulted in the wrong decisions.

Barfoot and Thompson have listed what they interpret under the Residential Tenancies Act, to be the obligations of the landlord. There are multiple changes that I believe need to be made:

  • The rental property owner must live in New Zealand
  • Must notify occupants of properties if intending to be away for more than 48 hours and up to 21 days
  • Formal standards need to be set for detection of methamphetamine labs or other such drug manufacture that makes a property unsuitable for use
  • In times of emergency – earthquake, fire, medical and so forth – where circumstance do not permit normal rules of entry, the landlord and affected occupants must make reasonable effort to establish contact by phone
  • Landlords must not make undue increase in rents in times of emergency and any change needs to be explained to occupants – “because I felt like it” shall not be sufficient

Occupants have obligations as well. I believe that in the best interests of transparency, in addition to those obligations that are listed on the Government tenancy services website, occupants should also:

  • Notify the landlord of an early end to occupancy
  • Notify the landlord of visitors staying more than three nights

The house might be an old bungalow, or it could be an old granny flat that was built to be specifically able to cater for a person living on their own with little or no need for a yard. The problems could range from structural deficiencies to a general lack of maintenance. It might have mould problems from excessive condensation or have unsafe wiring. It might have just one of these problems or the entire range.

What I propose is a nation wide compulsory rental property warrant of fitness. The warrant of fitness would be implemented by city councils in large urban areas and district councils in smaller towns. The warrant of fitness would cover:

  • Sanitation
  • Moisture
  • Hygiene
  • Fire and structural safety

It would be renewed every year and require registration by the landlord. Properties deemed unfit to be used as rental properties would have to display in a prominent place such as a window near the door, or on the door itself a sticker indicating its status.

Consistently non-compliant rental property owners would be struck off the register of rental properties if their property fails to meet the criteria set on, say, three or more consecutive occasions.

Like many regulations, this is to address the fact that there is a small percentage of people who refuse steadfastly employ common decency and ensure that rental properties they own are of a standard that is fit for habitation. They are of the opinion that the law is not applicable to them. These are the ones who should not be in the rental property industry. There is also a percentage of rental property owners who comply just so that they are not caught operating deficient properties, but whose general attitude is to do the bare minimum.