Hamish Aitken, Managing Director at Premier Insulation answers how landlords can prepare for the changes to insulation and fire alarms laws in New Zealand.
In July 2015 the Government proposed changes to the Residential Tenancy Act to strengthen requirements around insulation. Smoke alarms, better enforcement and faster resolution of disputes.
These changes include a requirement for all Landlords to have minimum insulation standards and fire alarms in rental properties by 2019. The pragmatic package of tenancy law changes will make tenanted homes warmer, drier and safer for New Zealand families without being too expensive.
The new insulation standard required by tenanted properties is not yet finalised. It was originally suggested that the minimum would be similar to the national requirements introduced in 1978. At that time a minimum thickness of 70mm, covering all accessible areas above habitable spaces – except where clearances are required around downlights or flues – was required. It is likely this requirement will see changes and meet current recommended standards, which promote a minimum resistance (R) values depending on where the property is in New Zealand.
It will also require suspended timber subfloors to have underfloor insulation in reasonable condition, covering all the accessible subfloor area beneath habitable spaces. Concrete slabs count as underfloor insulation, as does another habitable space immediately below. (A habitable spaces includes bedrooms, kitchens, living space, bathrooms, toilet, and laundry, but excludes garages and storage space (except where garages are used as living or sleeping areas). There will be exemptions, such as where it is physically impractical to retrofit insulation due to limited space underfloor or inaccessible raked ceilings.
There will be a two-stage approach to implementing the new insulation standards. Social housing (housing where tenants pay an income-related rent for a Housing New Zealand (HNZ) or community housing provider home) will be required to have insulation by 1 July 2019.
There will, furthermore, be a new requirement from 1 July 2016 for all landlords to state in tenancy agreements the level of ceiling, underfloor and wall insulation to help better inform tenants. So while it is not necessary to have upgraded the insulation before July 2019, it may become a key factor in attracting and holding onto good tenants if they have choice between insulated and uninsulated properties. The market may also start valuing the properties based on insulation quality installed.
For landlords who have properties with tenants holding Community Services Cards (beneficiaries and pensioners) then it is still possible for landlords to get a government subsidy of 80-100%. However, they must act quickly as this funding is limited and is likely to run out sometime 2016. After this date landlords may be required to fund the full cost of the insulation. This current programme is a very good deal and I recommend the landlords act quickly to get the funding while it lasts. Information on the scheme is available on the Energywise website.
It is highly recommended for landlords to not wait until 2019 before they take action. They will likely get better value by acting early and avoiding a late rush.
It is easy to arrange insulation for properties. There are a number of professional companies that will arrange a time to visit the property and do an assessment on what is required. The successful insulation company will then arrange a time to come and install the product. This usually takes less than a day and the average cost is <$3,300 per property. Furthermore, the cost of getting a professional company to install the product is usually cheaper than buying the product from a retailer and doing-it-yourself.
Installing insulation yourself is not an easy task. The conditions are often unpleasant to work in and there are many risks to the property and the installers health and safety. Professional insulation companies are experienced in this type of work and understand and manage these risks.
It is recommended property owners get at least two quotes, ideally from member of the Insulation Association of New Zealand.
If immediate finance is a problem, there are funding options available. Many local government councils have a payment scheme whereby you can get a loan and pay this back through your rates. There are also some professional insulation companies offering finance options such as no payments for 18 months.
Good insulation is also just good common sense. If done correctly, it will improve the quality/capital value of the property and have a positive impact on tenants who will experience lower energy costs and better health.
It is estimated there may be as many as 188,000 homes requiring further insulation.
Smoke alarms will also be required in all tenanted properties from 1 July 2016. The new regulations may make landlords responsible for ensuring an operational smoke alarm is in place, and the tenants responsible for replacing batteries or notifying landlords of defects. Long life (10-year) photoelectric alarms will be required, where there is no existing alarm or when replacing an existing alarm. It is estimated there are 120,000 without operating smoke alarms. Alarming all the homes could save many lives from fire related deaths.
Related documents are available on the Ministry of Buisness, Innovation and Employment website.
This home renovation advice by Hamish Aitken article featured on page 38 in Issue 017 of Renovate Magazine. Renovate Magazine is an easy to use resource providing fresh inspiration and motivation at every turn of the page.
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