November 28, 2023
As summer approaches, many renters in New Zealand are gearing up for their well-deserved vacations and contemplating the possibility of subletting their rental properties. Subletting is a practical solution that allows tenants to vacate their homes while someone else occupies the property. With recent changes in New Zealand’s rental laws, it’s an ideal time to familiarise yourself with the rules and regulations governing subletting. In this article, we will explore the ins and outs of subletting and provide some essential information to ensure any action your tenants take, aligns with what’s permitted.
What is Subletting?
In simple terms, subletting is the practice of allowing someone else to rent and occupy a tenanted property temporarily. It’s a popular short-term rental solution, enabling individuals to return to their homes after the sublease period ends.
The Rules Around Subletting
In 2020, New Zealand’s Residential Tenancies Act 1986 underwent significant amendments, aiming to bring rental laws in line with the modern-day rental market. The Residential Tenancies Amendment Act 2020 granted tenants the right to sublet their tenancy agreements unless explicitly prohibited in the rental agreement. However, there are essential rules and responsibilities for tenants wishing to sublet.
If the rental agreement contains no clause addressing subletting, tenants must seek permission from their landlord or property manager. It’s essential for renters to be transparent and request consent. In cases where a landlord denies a request unreasonably, tenants can appeal the decision to the Tenancy Tribunal.
Subletting: 5 Things to Consider
It’s crucial to consider a few key factors:
1. Starting the Process
If there is no clause regarding subletting in your tenancy agreement, your tenant must contact you or your property manager to discuss the situation. It is also usual that a tenant submits a written request that outlines their sublet plans.
2. There Are Risks Involved
Subletting carries inherent risks, including potential loss of control over the property, missed rent payments and property damage. If your tenant sublets without your permission they can incur a fine of up to $1500.
3. Finding a Reliable Candidate
The original tenant remains on the tenancy agreement and becomes a landlord to the subtenant. Therefore, it’s their responsibility to ensure rent payments are on time and the property is well-maintained.
4. Checks Are Essential
If you agree to a sublet, ask your property manager to perform necessary tenant checks, including gathering references from previous landlords, confirming proof of identity, conducting credit checks, and requesting permission to obtain a Ministry of Justice Criminal Record Check to ensure the candidate’s good character.
5. Landlords Can Set Conditions
While you can’t unreasonably decline a sublet request, you can impose reasonable conditions. For instance, you may require the subtenant to cover any increased insurance premiums associated with subletting. You can also ask to review the sublet agreement before granting permission.
Subletting can be a valuable option for renters in New Zealand, providing financial relief during vacations or temporary absences. Understanding the rules and responsibilities associated with subletting is crucial for both tenants and landlords. By following these guidelines and maintaining open communication, you can ensure a smooth subletting experience while adhering to the legal requirements of New Zealand’s rental laws.