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Compliance too expensive? The alternative could cost you thousands!

February 20, 2024

If we showed you several photos of different houses, would you know which one complied with Tenancy Law? The answer is probably no…

In NZ all Landlords and tenants have rights and responsibilities under The Residential Tenancies Act. A rental property must meet compliance guidelines set out by the act and Healthy Homes Standards.

We have even seen new builds fail compliance checks because builders have missed steps or have tried to take shortcuts. Ultimately as a Landlord, you are responsible for making sure the property is compliant before renting it out.

There are 5 key areas of compliance:

·      Heating

·      Insulation

·      Ventilation

·      Moisture Ingress

·      Draught stopping

To read more about the compliance in each of these areas please refer to the below link


Under the Residential Tenancies Act, landlords have an obligation to ensure that the premises comply with all of the relevant health, safety, and building requirements that apply to the premises. This includes(but is not limited to) any requirements under the following laws:

  • The Building Act 2004 and Building Code;
  • The Health Act 1956;
  • Housing Improvement Regulations;

If a premises does not have a Code of Compliance certificate it may not meet requirements. A landlord should discuss this matter with their local council to ensure the premises are safe for use and will be a habitable rental home.


Unlawful residential premises

Different types of unlawful dwellings

Section 78A of the Residential Tenancies Act 1986 (RTA) does not provide examples of what constitutes an unlawful dwelling. However, since these provisions became law as part the RTA 2019 Amendments, there have been many examples of the Tribunal making orders under Section 78A.

Below are eight descriptions of unlawful dwellings:
1. A premises that has never had resource nor building consent
2. Minor dwelling that never had resource consent
3. Minor dwelling that is not consented for sleeping
4. Minor dwelling that does not have CCC or COA
5. A rental property that does not comply with the Building Act 2004
6. A sleepout that has kitchen facilities
7. A premises that does not comply with the 1947 Housing Improvement Regulations
8. A premise that does not comply with the Building Code


A premises that has never had resource nor building consent.

One example of an unlawful dwelling is where a premises has never had a building consent nor a resource consent. In a recent tribunal case, a tenant made a claim against a landlord who rented out a property where all three residences used one letterbox and shared the same rubbish and recycling bin. The tenancy did not have a separate water meter or power meter although it was agreed that the rent would include these outgoings. The tenancy had just one room, containing a lounge and a kitchen. The kitchen had just a sink, a bench, and a portable gas cooker.

Between that ‘living area’ and the bedroom was a glass sliding door. In the bedroom there was a hand basin, shower and toilet but these facilities were only blocked off by a curtain.

The tenant, who was concerned about a sewage smell, made enquires with the Auckland City Council and accessed the property file. The property file contained no mention of the premises that the tenant lived in whatsoever, and the Tenancy Tribunal deemed the premises unlawful.

The landlord, unsuccessfully attempted to claim $1000 in rent arrears because under Section 78A (3) the Tribunal must not order the tenant to pay any rent arrears if the premises is unlawful.

The discretion of Tenancy Tribunal crucial in unlawful dwelling orders

Where appropriate, the Tribunal can order the tenant to not pay the landlord:
– Any money owing in rent arrears
– And any other sum of damages or compensation.

What orders can be made under Section 78A?

The Tribunal may also order a landlord who rents out an unlawful dwelling:
– A full rent refund, if the Tribunal is a satisfied the rental property was never consented as a residential premises.
– A partial rent refund if part of the rental property is lacking the necessary consent.
– A work order to remove or rectify any impediment that makes the premises unlawful
– A work order to comply with all requirements in respect of buildings, health, and safety under any enactment
– And exemplary damages of up to $7,200 if the landlord fails to comply

As a final note, even if the tenant does not make an application, the Tenancy Tribunal may make any of the above orders at its own initiative.

The wide range or orders available to the Tenancy Tribunal highlights how seriously the government views unlawful dwellings. Landlords will be held accountable for renting out properties which are either unconsented, non-compliant or expose tenants to health and safety risks. However, an important point to note is that the Tenancy Tribunal can use its discretion under Section 78A.


Case Study

Tribunal Case

The unit had been rented to the tenant as a standalone and self-contained premise . The unit was consented by the territorial authority as a “games room” or additional sleep out only. There is no council consent for the change of use from “games room” The Tribunal  declared the premises to be an unlawful residential premises. Under section77 of Residential Tenancies Act 1986. Due to the landlord’s failure to comply with requirements in respect of buildings, health, and safety and nature of the dwelling set, the adjudicator ruled that the unit should not have been let out to anyone. Taking into account the entire rent for the tenancy that the tenant had paid from start to end of tenancy, the adjudicator ruled an order for the landlord to return to the tenant a total sum of $30,000.00 which sum equates to a return of about 95% of the total rent paid by the tenant  in renting the unlawful residential premises.

Read the tribunal Case here:

When is a Bedroom Not a Bedroom?

This may seem like a trick question but I am asked all the time if a certain room can be classified a bedroom. Well you are probably surprised to know that there are actually requirements for a minimum bedroom size set by the Housing Improvement Regulations 1947.

The regulations prescribe minimum standards for a bedroom. As Property Managers we run the risk of breaching Tenancy Law, if we provide false or misleading information, we need to make sure that rooms meet those benchmarks in the Regulations before advertising them as bedrooms.

So what are the minimum requirements to legally call a room, a bedroom?

There are a few exceptions eg for apartments but unless those exceptions apply, to be called a bedroom, a minimum bedroom size must:

  • Have a minimum width of 1.8 metres
  • Have an area of not less than 6 m2
  • In an existing house a room with an area of less than 6 sqm but not less than 4.5 sqm may be occupied as a bedroom by a person under 10 years of age. (This is an interesting one as some 10 year olds are taller than adults!) (Note that an ‘existing house’ is one built prior to April 1975)
  • Have a height from finished floor to finished ceiling of at least 2.1 metres in an existing house (as at 1975), or 2.4 metres in a new house (a new house is defined as being built after April 1975)
  • Have at least one window situated in an external wall to admit adequate light (this could be a skylight)
  • The aggregate area of glass in the windows must not be less than one-tenth of the floor area of the room
  • Windows with an area of not less than one-twentieth of the floor area must be able to be opened to allow air circulation, or in accordance with local authority requirements.
  • In calculating the area of a bedroom, any part of the room with a finished floor to finished ceiling height of less than 1.5 metres must be excluded.

So if the minimum width of your bedroom is 1.8 metres wide, then the length needs to be a minimum of 3.33 metres to be called a bedroom. Of course then you have the height and window requirements as well. Note that the wardrobe is typically included in the size of the room.

Then the question is it a single or double is also made quite clear if you have a bedroom that’s less than 10 square metres, so long as it is at least 6 square metres, with a minimum width of 1.8m. But you do have to call it a single bedroom, not a double.

Under the Housing Improvement Regulations, mentioned above, if we advertised any bedroom that is not legally a bedroom room, we could risk a fine and huge exemplary damages imposed to landlords.

If you need help on deciding how to market your home for rental advertising please feel free to give us a call. At The Rent Shop we are happy to help contact our BDM Team 09555-9100

Sharon Bradley
General Manager of Licensees/Training