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Your home is likely to be one of your biggest financial assets, but often it’s also the place you raised your children and spent many happy hours with friends and family. Selling your home can evoke strong emotions, but here are a few strategies to help you keep those emotions in check and achieve the best result.

Home vs property
It’s natural to have second thoughts about selling what you think of as ‘home’ and leaving behind all the memories connected with it. As soon as you decide to sell, start thinking of your ‘home’ as your ‘property’ – an asset that you wish to sell and that you want to make as appealing as possible to others who are looking to buy.

Start with a clean slate
When preparing to list a property for sale, it’s important to declutter and depersonalise your home which means removing your family portraits, knickknacks, souvenirs, diplomas and mementos. By doing so, you’re making it easier for potential buyers to envision themselves and their possessions in the house. Packing up your personal items and storing them out of sight early in the process can also help you come to terms with your emotions.

Remember your ‘why’
When you start to second guess your decision to sell, remind yourself why you’re doing it and what you have to look forward to. Make a list of and put it somewhere prominent. Whether you’re downsizing, upsizing, retiring or moving closer to family, keep coming back to the upside and what motivated you to sell in the first place.

Find a sales consultant you trust
Once you’ve made the decision to sell, it’s critical to choose a sales consultant and a company that you trust – someone who has expert local knowledge and keeps you informed throughout the process. Make sure the sales consultant can show you how he or she will maximise competition for your property while minimising any potential complications. Once you’ve found the right person, take their advice on board,
present your property well and you can be assured of a great experience.

FOMO stokes market

Auckland is amid some of the strongest market conditions ever experienced. Our virtual auction rooms, a hive of online activity with determined buyers vying to secure property. Harcourts Cooper & Co had over 3,200 people tune in to watch our auctions over the past 7 days.

North Shore sales volumes plummeted 67% in September due to the level 4 lockdown. Moving into level 3 combined with the usual Spring lift has assisted in a dramatic rebound in October to 416 sales – above the long-term average volumes as depicted below. The ability to conduct business remotely and eased restrictions around viewings have enabled real estate continuity, while a general FOMO — fear of missing out – stokes a market that remains strong.

This FOMO, supply, demand & relatively low interest rates continue to fuel price increases with the North Shore median up 28% when compared to prior year. We are yet to see any impact of Government measures to slow price increases.

As we head into the heat of Summer there are no signs of the market cooling. Growing confidence of vendors and buyers to make property decisions is evident.

Private landlords and professional property managers are bound by the regulations and laws under the Residential Tenancies Act 1986 (RTA) amended by the Residential Tenancies Amendment Act 2020, Residential Tenancies (Healthy Home Standards) Regulations 2019, and the Housing Improvement Regulations 1947.

Due to the constant changes and large number of regulations to abide by, it can be difficult and confusing for owners to interpret the threshold of responsibility required in various instances, especially when it comes to applying the law to real life situations. The following information aims to explain the various thresholds that are often misinterpreted or misunderstood by landlords, providing further clarity on the ways certain aspects of the law are interpreted.

Application for cost for ‘Accidental Damage’ – Section 49B of the RTA
Under section 49B of the RTA, a tenant is only liable for the full cost of the damage to the premises if they intentionally caused the damage or the damage was the result of an act or omission constituting an imprisonable offence of the tenant or a person whose actions the tenant is responsible for. However, if the damage caused was ‘accidental’, that is the damage was caused by a careless act or omission of the tenant, even if the tenant is proved to be held liable, their liability is limited to the lesser of the insurance excess or 4 weeks rent.

The threshold for landlords to prove accidental damage is fact dependent. For a tenant to be fully liable for the damage, the landlord must prove that the damage was not fair wear and tear, the damage was caused intentionally or by an act or omission constituting an imprisonable offence, and that the landlord will not be able to access insurance monies due to the act. The tenant will then have an opportunity to prove that any destruction or damage was not intentionally done nor was the destruction or damage caused by a careless act or omission.

In Guo v Korck [2019] NZHC 1541, it was stated that damage is intentional where a person intends to cause damage and takes the necessary steps to achieve that purpose. Damage is also intentional where a person does something, or allows a situation to continue, knowing that damage is a certainty. For example: A crack to an internal door caused by a tenant slamming the door is likely to be deemed a careless act and the tenant will likely be liable for the lesser of the insurance excess to fix the door or 4 weeks rent. However, a hole dug out through the middle of an internal door by any instrument is intentional and the tenant will likely be liable for the entire cost of the damages.

Fair Wear and Tear – section 49A(2) RTA
As a general principle, a tenant is not liable for the fair wear and tear of chattels or the premises. ‘Fair wear and tear’ refers to the gradual deterioration of things that are used regularly in a property when people live in it. Often, it can be difficult to judge the definition of fair wear and tear. If a stove element wears out from normal cooking that is fair wear and tear. However, if the stove was being used to heat up a one-bedroom apartment and was switched on 24-7, that is not considered fair wear and tear.
Further examples of fair wear and tear include the flooring getting worn, taps and washers in the kitchen, bathroom, or laundry wearing out or leaking. While burn marks or drink stains on the carpet and drawing on wallpaper may not be.
Landlords should also keep in mind the age of the premises and chattels in making a fair judgement and request for compensation. A burn mark on a carpet that is 5 years old will not be treated the same as a burn mark on a new carpet, therefore, compensation for damage will also be calculated with the age of the carpet in mind. For example: A crack to an internal door caused by a tenant slamming the door is likely to be deemed a careless act and the tenant will likely be liable for the lesser of the insurance excess to fix the door or 4 weeks rent. However, a hole dug out through the middle of an internal door by any instrument is intentional and the tenant will likely be liable for the entire cost of the damages.

Fair Wear and Tear – section 49A(2) RTA
As a general principle, a tenant is not liable for the fair wear and tear of chattels or the premises. ‘Fair wear and tear’ refers to the gradual deterioration of things that are used regularly in a property when people live in it. Often, it can be difficult to judge the definition of fair wear and tear. If a stove element wears out from normal cooking that is fair wear and tear. However, if the stove was being used to heat up a one-bedroom apartment and was switched on 24-7, that is not considered fair wear and tear.

Further examples of fair wear and tear include the flooring getting worn, taps and washers in the kitchen, bathroom, or laundry wearing out or leaking. While burn marks or drink stains on the carpet and drawing on wallpaper may not be.

Landlords should also keep in mind the age of the premises and chattels in making a fair judgement and request for compensation. A burn mark on a carpet that is 5 years old will not be treated the same as a burn mark on a new carpet, therefore, compensation for damage will also be calculated with the age of the carpet in mind.

Landlords should be prepared that they will not be compensated the value of the carpet when it was new and will need to depreciate the value of any item that is damaged.

The Inland Revenue website has easyto-use calculators to calculate the general depreciation value of items.
Although we note that these are for tax purposes, they will provide a guideline for the value of the items over time. For example: At a recent tribunal hearing, it was claimed by a landlord that the carpet in a sleepout had been stained by a dog entering the property when the tenancy agreement ruled that no pets were allowed. The tribunal decided that by allowing the dog to enter the sleepout repeatedly, it assessed that this was intentional damage. The landlord claimed $1,063.42+GST for full replacement of the carpet but the Tribunal took into account that the carpet was 6 years old, with a useful lifespan of 10 years, therefore, $489.17 was awarded.

Breach of Quiet Enjoyment – section 38 RTA
Tenants are entitled to have quiet enjoyment of the premises without interruption by the landlord, neighbours, or other tenants. While you must give proper notice before entering the tenanted premises (dwelling) as per section 48 of the Act, to minimise any breaches to a tenant’s quiet enjoyment, it is best practice to remember to also give the same notice before entering the land to conduct repairs or maintenance on the exterior of the property. It is important to note that it is not a breach of the tenant’s quiet enjoyment if the landlord is simply complying with their obligations under the Residential Tenancies Act 1986. The Act provides when the landlord can enter the premises to carry out work and for other purposes. The tenant must not prevent the landlord from entering in those circumstances.

Tenancy Services, and section 48(7) of the RTA states that landlords do not need to give notice to come onto the property (the land) when the landlord has agreed to do things like mow the lawn for the tenants, or to maintain the outside of the house. Though, while you can access the grounds and exterior without notice, as a landlord this should not be done unreasonably so, as you still need to avoid interfering with the tenant’s quiet enjoyment.

To avoid any misunderstandings, please see our above guidelines. Please be aware that from any tenant’s perspective, a stranger walking even on the property can cause alarm and distress.

Source REINZ

Market Update | August 2021

We went into lockdown with rising prices and sales volumes were circa average when looking at the longer term trends. The recent data released from The Real Estate Institute of New Zealand (REINZ) for August showed a median North Shore sales price of $1,295.000. This is an increase of 16% when compared to the same period last year.

New Zealand achieved another record median sale price of $850,000.

Given New Zealand was in level 4 lockdown from the 18th of August it is certainly of no surprise that the sales volumes were impacted. The 331 sales achieved on the North Shore in August was approximately 23% down when compared to the same period last year. Median days to sell however do remain low at 34.

Our online auctions at Harcourts Cooper & Co continue to be exceptionally strong during the current lockdown we completed 33 online auctions with 32 of those selling under the virtual hammer. Our auction team in August conducted 79 auctions with an overall success rate of 92%.

Aucklander’s are hopeful that next week we will see a move to level 3. Confidence is high that the market will remain strong as we enter into this usual busy spring selling season.

The current lockdown is likely to have propelled that energy, the built up demand from buyers wanting to purchase, vendors wanting to sell, people needing to move, add to that the fuel of low interest rates, low unemployment and furthermore the confidence in the markets reaction following a lockdown that was evidenced last year, all indicating a very strong finish to the 2021 property market.