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Do you still need to insulate your rental property by 1 July 2019?

March 29th, 2019.

Do you still need to insulate your rental property by 1 July 2019?

Yes. Compliance time frames for the existing 2016 insulation requirements remain in place and every rental property must have the required insulation by 1 July 2019 or must meet the conditions for exemption.

Pedersens has been working closely with all of our owners over the last 18 months and at this point nearly all of our owner’s rental properties have been confirmed as compliant. For any of our owners that either do not have written proof of compliance confirmed meaning a compliance/exemption certificate from an insulation professional or a insulation declaration that has been completed and signed by the owners of the property or a scheduled insulation installation date with a paid deposit, then we will be in touch over the week to discuss urgent next steps to ensure that the requirements and deadline are meet.

 

What is required by 1 July 2019?

Under the 2016 insulation standard, landlords must ensure that their rental properties ceiling and underfloor insulation must be installed with set minimum R values shown below, where it is reasonably practicable by 1 July 2019. It must meet the standards set out in the regulations and be installed safely. Wall insulation is not compulsory.

Insulation Requirements 2016

 

How do I ensure my rental property meets the required standard?

 

1. Confirm whether insulation can be installed

Some exceptions to this requirement apply to certain property types. For example, these properties are either physically impossible to insulate, or would require major renovations to do so.

 

2. Assess the current insulation by either:

 

  • Physically looking in your ceiling cavity and underfloor area and then complete and sign the Tenancy Services insulation declaration template that you can then include as is required by law to be part of your standard tenancy agreement documentation.

 

  • Hire an insulation professional to do an assessment of your rental property and provide you with a certificate of compliance for the 2016 standard.

 

  • Check the council building file and confirm it meets the 2016 standard. If the insulation was not installed recently, remember to also physically check the insulation to ensure its original condition of the insulation has been maintained and then complete and sign an insulation declaration as stated above.

 

3. Install or top up insulation as required

Landlords must install ceiling and underfloor insulation, wherever possible. It must comply with the regulations and be safely installed.

 

 

What will happen if I don’t meet the 1 July 2019 deadline?

Insulation contractors are currently experiencing exceptionally high work volumes trying to meet the existing assessment and installation bookings they currently have confirmed. So if you haven’t yet started the process of getting your rental property compliant, we would strongly recommend getting onto to this immediately.

MBIE’s Tenancy Services Compliance and Investigation team will have the power to inspect properties to ensure compliance with the standards. The team’s expanding capacity will enable them to undertake 2,000 risk-based interventions every year. Landlords that fail to comply with the required standards will be liable for a $4,000 fine payable to the tenant in most cases.

This means that if a tenant contacts Tenancy Services and reports that they are renting an uninsulated property, that this team then has the power to fully take over the process that the tenant would normally otherwise have to follow. The Tenancy Services Compliance and Investigation team will investigate the property and if found to be non-compliant they will then proceed to make an application against the landlord to the Tenancy Tribunal and will represent the case at Tribunal in place of the tenant. Landlords with more than one tenancy may face separate damages for each property that doesn't comply. They will then still need to install insulation that meets the correct standard. Any landlords who still don’t comply after paying the penalty, may face further action.

As a landlord it’s not a financially viable risk worth taking, so getting compliant before the July 2019 deadline is imperative for all landlords.

 

What will change under the Healthy Homes Standards?

The Healthy Homes Standards will include new requirements for insulation, which will take effect from 1 July 2021 onwards.

Under the current 2016 requirements, landlords must ensure that their rental properties have the right ceiling and underfloor insulation by 1 July 2019.

Landlords who have installed new insulation since 2016 should already meet the 2008 Building Code, so they won’t need to do anything further when the Healthy Homes Standards take effect.

However, landlords who didn’t previously need to insulate under the current requirements, may now need to do so under the Healthy Homes Standards. Currently, if the property already has ceiling insulation which is at least 70mm thick and underfloor insulation, and both are in good condition, then landlords have not been required to take action. It is this group of properties that fall into the 69mm to 119mm space that will be most affected by the new HHS insulation standards and will most likely need to have their insulation topped up.

Under the Healthy Homes Standards, all rental properties will need to have insulation which meets the 2008 Building Code, or is at least 120mm thick.

If you are in still in the process of getting insulation installed, the advice that we received from Tenancy Services was to ensure that anything new installed meets the new Healthy Home Standard of a minimum level of thickness of 120mm for ceiling insulation or insulate to a level that meets the 2008 Building Code.

 

 

Once insulation compliance has been confirmed, do I need to do anything else?

There is a responsibility on the landlord to be able to evidence at the time of questioning that the properties insulation levels continue to meet the required standard, whether that be currently the 2016 standard or come 2021 the new HHS standard.

This could potentially mean that the existing insulation that has been previously confirmed as compliant could require ongoing periodic assessments to ensure that it has not deteriorated below the current required standards or been damaged or compromised in anyway.

When we questioned Tenancy Services about this they stated that they do not have any recommended best practice guidelines as to whether periodic assessments are required and if so what the frequency of these insulation assessments should be. All they stated was that if the insulation levels were challenged the onus would be on the landlord to evidence that the insulation as at the date of being challenged still meet the required standards of the current time.

This then leaves a lot of questions around what ongoing requirements there are (if any) once a property has been confirmed as compliant. If periodic assessments should be undertaken, how frequent is enough to ensure that as a landlord you are continuing to meet your obligations under the RTA? What if unbeknownst to you the insulation levels had dropped for whatever reason below the required threshold due to unforeseen reasons? What duty of care does a landlord have to ensure that the condition of the insulation is maintained? Then what would be considered a reasonable level of duty of care when undertaking periodic assessments of the insulation - annually, between every tenancy or every few years?

We feel that more specific clarification is needed around this to ensure that both landlords and tenants understand exactly what is required, not only at certain dates but also ongoing.

 

 

Information in this article has been sourced from the following sites:

Tenancy Services Contact Centre – https://www.tenancy.govt.nz/
David Faulkner Real-Iq - https://realiq.nz/
 

7 Comments

David says ...
A great article that gives landlords information they require well done. I suspect we will see an announcement as to how this is managed later in the year.
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A great article that gives landlords information they require well done. I suspect we will see an announcement as to how this is managed later in the year.
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