What was Tenancy Tribunal case 5051330 about?

The tribunal order states: The tenants’ names and identifying details must not be published.

How much money was awarded in case 5051330?

1. The Tenants’ Names And Identifyin…: $1,250.00 awarded to landlord

What type of tenancy dispute was case 5051330?

The dispute type was not classified.

Where can I read the official tribunal order for case 5051330?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11472441-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 5051330 about?

The tribunal order states: The tenants’ names and identifying details must not be published.

How much money was awarded in case 5051330?

1. The Tenants’ Names And Identifyin…: $1,250.00 awarded to landlord

What type of tenancy dispute was case 5051330?

The dispute type was not classified.

Where can I read the official tribunal order for case 5051330?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11472441-Tribunal_Order_Redacted.pdf.

New Zealand Tenancy Tribunal Case 5051330 — Tenancy dispute

Claims and awards in Tenancy Tribunal application 5051330. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
1. The tenants’ names and identifying details must not be published. 2. The Tribunal declares that the market rent for t	$1,250.00		1. The tenants’ names and identifying details must not be published. 2. The Tribunal declares that the market rent for t

Order

The tenants’ names and identifying details must not be published.
The Tribunal declares that the market rent for the premises is $1,250.00.
This order takes effect from 28 December 2024.
The landlord’s rent increase notice dated 24 October 2024 is invalid and of no effect.
The landlord must not increase the weekly rent to take effect any earlier than 28 December 2025.

Reasons

The tenants attended the hearing in person.
Anna Zhou attended for Bayleys Real Estate, Auckland Central.
The tenants apply for a rent reduction on the ground that their rent is not in line with market rent. Background
The tenancy began on 9 December 2023. The premises is a newly-built town house. It is one of a row of four similarly built town houses that were built simultaneously with the premises.
The premises has five bedrooms, three bathrooms, one lounge, an open plan kitchen, dining, and lounge area, a single garage, and one off-street park. It has little outdoor living, really just a deck which is not particularly private from the neighbours. It has two stories.
The house is well-constructed. It has weatherboard and wood-panelled exterior walls and iron roofing. It is finished to a good standard. It is fitted out with good quality appliances. Ms Zhou says the house is well set out.
The photographs suggest this is a reasonable quality development. The architecture is sound though not bespoke. It appears overall to be an above average new house.
The house is located in a suburban area, not far from Mount Smart Stadium. It is near to a commercial/office area, but conversely Cornwall Park is not far away. Legal principles
Sections 25(1) and (3) of the Residential Tenancies Act 1986 (RTA) provide: (1) On an application made to it at any time by the tenant, the Tribunal may, in accordance with the succeeding provisions of this section, on being satisfied that the rent payable or to become payable for the tenancy exceeds the market rent by a substantial amount, make an order reducing the rent to an amount, to be specified in the order, that is in line with the market rent. (3) For the purposes of this Act, the market rent for any tenancy shall be the rent that, without regard to the personal circumstances of the landlord or the tenant, a willing landlord might reasonably expect to receive and a willing tenant might reasonably expect to pay for the tenancy, taking into consideration the general level of rents (other than income-related rents within the meaning of section 2(1) of the Public and Community Housing Management Act 1992) for comparable tenancies of comparable premises in the locality or in similar localities and such other matters as the Tribunal considers relevant.
The Tribunal must answer three questions to decide the market rent claim: 1 a. First, what is the market rent for the premises? b. Second, whether the rent or proposed rent is substantially above the market value? c. And, if so, thirdly, what the rent should be.

What is the market rent for the premises?

The test for market rent is the amount “a willing landlord might reasonably expect to receive, and a willing tenant might reasonably expect to pay for the tenancy”.
The concept of the 'market' is constrained by the requirement that both parties be 'willing', and that the rent meets their 'reasonable' expectations.
The factors the Tribunal may have regard to are “the general level of rents ... for comparable tenancies of comparable premises in the locality or in similar localities and such other matters as the Tribunal considers relevant”.
The Tribunal commonly refers to the market rent statistics published by Tenancy Services. 2 These statistics record a summary of the general level of rents charged for tenancies where bonds have been lodged over the six months about a month prior. The statistics set out median or averaged figures for the lower quartile, median, and upper quartile rents suburb-by-suburb.
Tribunal may also consider “such other matters as [it] considers relevant” to market rent. In Housing New Zealand v Hobman (DC Lower Hutt, TT89/97, 27 November 1997) the Court said the other factors to be considered must be of the same kind as the preceding specified factors. It is arguable however that the term ‘other matters’ is broad enough to cover any anything relevant to the ‘reasonable’ expectations of a ‘willing’ landlord or tenant.
The Tribunal also – as in this case - receives evidence about comparable rents based on advertisements for similar premises in the locality. This evidence has its limitations. Although advertisements usually list the essential features of the property advertised, there is often limited detail available for comparison. Photographs help but must be treated with caution because photographs will be selective, can be doctored, and may not depict the warts and all reality. 1 Property Brokers Hawke’s Bay Limited v Michaelsen [2024] NZDC 13815; and Fisken & Associates Limited v Lecole and Lecole [2023] NZDC 17698. 2 Approved in Property Brokers Hawke’s Bay Limited v Michaelsen [2024] NZDC 13815 at [21]-[23].
Also, advertisements only cover houses currently on the market and do not necessarily reflect the overall level of rents charged for existing similar tenancies in the area. Moreover, the rent amount advertised may not be the actual rent that the landlord and the tenant ultimately agree to.
The relevant date range to assess the market rent is from the date the application was filed on, 28 October 2024, to 12 months from today, the prospective period the Tribunal’s orders may apply. Bond data
Tenancy Services hold bond data for Onehunga.
This is an almost new quality townhouse, located in a moderately desirable part of Onehunga. I consider its rental value would be in the upper quartile for rental properties in Onehunga.
For the period 1 June to 30 November 2024, for five-plus bedroom houses in Onehunga, the average or mean Upper Quartile rent was $995.00. For the next month’s period, 1 July to 31 December 2024, the average or mean Upper Quartile rent was $1,190.00.
This data supports the market rent for this property as being likely to be in the vicinity of $995.00 to $1,190.00. However, the detail is too crude too meaningfully extrapolate a more exact figure for the market rent for this premises. Rents for comparable premises
A significant characteristic of this premises is its newness and good quality build. A property like this will attract a significant portion of prospective renters. It has virtually no outdoor area. That may seem a deficit when there are attractive villas and bungalows in the area that have generously sized garden with lawns and mature trees. However, to some prospective tenants, the lack of a decent garden is a bonus because the complications of maintenance do not arise.
A new property like this would likely to appeal as being low-risk. If everything is new, not a lot is likely to wear out and it is likely to be healthy to live in and clean. Non-New Zealanders, from large, modern cities might find old villas and bungalows foreign, so this new-build would likely be more attractive to them.
The parties proffered advertised examples of about 10 broadly comparable properties. I have found only three of them are similar enough to this premises to serve as useful comparators. Namely: the premises’ neighbouring town houses on the same plot, 11B and 11C [suppressed] Road; and 23A Raurenga Avenue, Royal Oak.
11B and 11C provide a close comparison to the premises. They were built at the same time in the same fashion and have comparable amenities.
11B and 11C were rented out in December 2024 for $1,050. The main differences include that they are off the street, so would have more privacy and less street noise, they only have four bedrooms, and 11B only has one off-street carpark. Ms Zhou says 11B and C have slightly less living space than 11A.
Ms Zhou was at pains to point out that December is a traditionally slow month for rentals. It is fair point. I also note, however, that Tenancy Service’s bond data indicates that December 2024 was a good month for Upper Quartile five- plus bedroom properties in Onehunga because the period to December 2024 leapt about $200.00.
Based on 11B and C’s current rentals I should think that 11A would have a market value of 15-20 percent more, so therefore a range of between $1,207.50 to $1,260.00.
Another, relevant “sample of one” comparator is what the tenants agreed to pay when the tenancy began, a little over a year ago: $1,250.00. The tenants submit they were rushed at the time, however, and now they realise they have been paying too much.
During the hearing, Ms Zhou indicated a willingness to leave the rent as it is at $1,250.00 which suggests that the landlord considers the current rent to be in line with what a reasonable landlord would hope to receive from good tenants, as these tenants clearly are.
23A Raurenga Avenue, Royal Oak is also a useful comparator. There is a risk that just relying on the premises close neighbours could lead to an inaccurate outcome. Perhaps Ms Zhou has a special network that enables her to outperform the market, for example. The advertised rent for the premises is $1,260.00 per week. This property is in a different suburb a couple of kilometres away. Its location is superior in my view because it is close to Cornwall Park and to a large supermarket and retail area. It is near major bus routes. The premises is not far from Te Papa Railway Station, but the Onehunga Line’s timetabling is erratic. The property includes a second lounge, has a fully-fenced section and an extra two carparks. 23A Raurenga looks better than the premises based on the limited information I have, and it is only $10.00 per week more than the premises’ original rent. Conclusion on market rent
Having considered all the evidence and the submissions, I conclude that the market rent for the premises in $1,250.00.
That figure is in proportion to 11B and C’s weekly rents. 23A Raurenga is better value for money based on the limited evidence I have, but it is possible it has fishhooks that naturally will not be mentioned in the inevitably relentlessly positive advertising blurb. Moreover, there will generally always be better or worse rental deals available in the market, this property is in a different (albeit in my view more desirable location) and it the weekly rent is not vastly out of step with the market rent level I have found for the premises.

Is the rent or proposed rent substantially more than the market rent?

The landlord’s rent increase is $100.00 more than the market rent.
Whether that is a “substantial” discrepancy is an evaluative question. $100.00 strikes me as being a considerable amount. In the context of tenants choosing premises of this type to live in, a difference of $100.00 per week would have an impact on their decision-making. Put another way, the tenants are being required to paid and are paying $100.00, or about 8 per cent more than they should be paying.
I am satisfied that the current rent is substantially above the market rent for the premises.

What should the rent be?

The weekly rent should remain at $1,250.00 per week for 12 months commencing from the date of the proposed rent increase, 28 December 2024.
The Tribunal therefore grants the tenants application to the extent that the rent is to remain the same as it was originally.
The landlord should repay any overpaid rent or credit it to the tenant’s future rent. Non-publication
The tenants seek non-publication of their names.
The Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
The tenants have succeeded in their claim. Publication is not in the public interest nor justified by the tenants’ conduct or any other circumstances.
The Tribunal orders non-publication of the tenants’ names.

Claims and awards in Tenancy Tribunal application 5051330. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Landlord	Tenant	Reason
1. The tenants’ names and identifying details must not be published. 2. The Tribunal declares that the market rent for t	$1,250.00		1. The tenants’ names and identifying details must not be published. 2. The Tribunal declares that the market rent for t

Order

The tenants’ names and identifying details must not be published.
The Tribunal declares that the market rent for the premises is $1,250.00.
This order takes effect from 28 December 2024.
The landlord’s rent increase notice dated 24 October 2024 is invalid and of no effect.
The landlord must not increase the weekly rent to take effect any earlier than 28 December 2025.

Reasons

The tenants attended the hearing in person.
Anna Zhou attended for Bayleys Real Estate, Auckland Central.
The tenants apply for a rent reduction on the ground that their rent is not in line with market rent. Background
The tenancy began on 9 December 2023. The premises is a newly-built town house. It is one of a row of four similarly built town houses that were built simultaneously with the premises.
The premises has five bedrooms, three bathrooms, one lounge, an open plan kitchen, dining, and lounge area, a single garage, and one off-street park. It has little outdoor living, really just a deck which is not particularly private from the neighbours. It has two stories.
The house is well-constructed. It has weatherboard and wood-panelled exterior walls and iron roofing. It is finished to a good standard. It is fitted out with good quality appliances. Ms Zhou says the house is well set out.
The photographs suggest this is a reasonable quality development. The architecture is sound though not bespoke. It appears overall to be an above average new house.
The house is located in a suburban area, not far from Mount Smart Stadium. It is near to a commercial/office area, but conversely Cornwall Park is not far away. Legal principles
Sections 25(1) and (3) of the Residential Tenancies Act 1986 (RTA) provide: (1) On an application made to it at any time by the tenant, the Tribunal may, in accordance with the succeeding provisions of this section, on being satisfied that the rent payable or to become payable for the tenancy exceeds the market rent by a substantial amount, make an order reducing the rent to an amount, to be specified in the order, that is in line with the market rent. (3) For the purposes of this Act, the market rent for any tenancy shall be the rent that, without regard to the personal circumstances of the landlord or the tenant, a willing landlord might reasonably expect to receive and a willing tenant might reasonably expect to pay for the tenancy, taking into consideration the general level of rents (other than income-related rents within the meaning of section 2(1) of the Public and Community Housing Management Act 1992) for comparable tenancies of comparable premises in the locality or in similar localities and such other matters as the Tribunal considers relevant.
The Tribunal must answer three questions to decide the market rent claim: 1 a. First, what is the market rent for the premises? b. Second, whether the rent or proposed rent is substantially above the market value? c. And, if so, thirdly, what the rent should be.

What is the market rent for the premises?

The test for market rent is the amount “a willing landlord might reasonably expect to receive, and a willing tenant might reasonably expect to pay for the tenancy”.
The concept of the 'market' is constrained by the requirement that both parties be 'willing', and that the rent meets their 'reasonable' expectations.
The factors the Tribunal may have regard to are “the general level of rents ... for comparable tenancies of comparable premises in the locality or in similar localities and such other matters as the Tribunal considers relevant”.
The Tribunal commonly refers to the market rent statistics published by Tenancy Services. 2 These statistics record a summary of the general level of rents charged for tenancies where bonds have been lodged over the six months about a month prior. The statistics set out median or averaged figures for the lower quartile, median, and upper quartile rents suburb-by-suburb.
Tribunal may also consider “such other matters as [it] considers relevant” to market rent. In Housing New Zealand v Hobman (DC Lower Hutt, TT89/97, 27 November 1997) the Court said the other factors to be considered must be of the same kind as the preceding specified factors. It is arguable however that the term ‘other matters’ is broad enough to cover any anything relevant to the ‘reasonable’ expectations of a ‘willing’ landlord or tenant.
The Tribunal also – as in this case - receives evidence about comparable rents based on advertisements for similar premises in the locality. This evidence has its limitations. Although advertisements usually list the essential features of the property advertised, there is often limited detail available for comparison. Photographs help but must be treated with caution because photographs will be selective, can be doctored, and may not depict the warts and all reality. 1 Property Brokers Hawke’s Bay Limited v Michaelsen [2024] NZDC 13815; and Fisken & Associates Limited v Lecole and Lecole [2023] NZDC 17698. 2 Approved in Property Brokers Hawke’s Bay Limited v Michaelsen [2024] NZDC 13815 at [21]-[23].
Also, advertisements only cover houses currently on the market and do not necessarily reflect the overall level of rents charged for existing similar tenancies in the area. Moreover, the rent amount advertised may not be the actual rent that the landlord and the tenant ultimately agree to.
The relevant date range to assess the market rent is from the date the application was filed on, 28 October 2024, to 12 months from today, the prospective period the Tribunal’s orders may apply. Bond data
Tenancy Services hold bond data for Onehunga.
This is an almost new quality townhouse, located in a moderately desirable part of Onehunga. I consider its rental value would be in the upper quartile for rental properties in Onehunga.
For the period 1 June to 30 November 2024, for five-plus bedroom houses in Onehunga, the average or mean Upper Quartile rent was $995.00. For the next month’s period, 1 July to 31 December 2024, the average or mean Upper Quartile rent was $1,190.00.
This data supports the market rent for this property as being likely to be in the vicinity of $995.00 to $1,190.00. However, the detail is too crude too meaningfully extrapolate a more exact figure for the market rent for this premises. Rents for comparable premises
A significant characteristic of this premises is its newness and good quality build. A property like this will attract a significant portion of prospective renters. It has virtually no outdoor area. That may seem a deficit when there are attractive villas and bungalows in the area that have generously sized garden with lawns and mature trees. However, to some prospective tenants, the lack of a decent garden is a bonus because the complications of maintenance do not arise.
A new property like this would likely to appeal as being low-risk. If everything is new, not a lot is likely to wear out and it is likely to be healthy to live in and clean. Non-New Zealanders, from large, modern cities might find old villas and bungalows foreign, so this new-build would likely be more attractive to them.
The parties proffered advertised examples of about 10 broadly comparable properties. I have found only three of them are similar enough to this premises to serve as useful comparators. Namely: the premises’ neighbouring town houses on the same plot, 11B and 11C [suppressed] Road; and 23A Raurenga Avenue, Royal Oak.
11B and 11C provide a close comparison to the premises. They were built at the same time in the same fashion and have comparable amenities.
11B and 11C were rented out in December 2024 for $1,050. The main differences include that they are off the street, so would have more privacy and less street noise, they only have four bedrooms, and 11B only has one off-street carpark. Ms Zhou says 11B and C have slightly less living space than 11A.
Ms Zhou was at pains to point out that December is a traditionally slow month for rentals. It is fair point. I also note, however, that Tenancy Service’s bond data indicates that December 2024 was a good month for Upper Quartile five- plus bedroom properties in Onehunga because the period to December 2024 leapt about $200.00.
Based on 11B and C’s current rentals I should think that 11A would have a market value of 15-20 percent more, so therefore a range of between $1,207.50 to $1,260.00.
Another, relevant “sample of one” comparator is what the tenants agreed to pay when the tenancy began, a little over a year ago: $1,250.00. The tenants submit they were rushed at the time, however, and now they realise they have been paying too much.
During the hearing, Ms Zhou indicated a willingness to leave the rent as it is at $1,250.00 which suggests that the landlord considers the current rent to be in line with what a reasonable landlord would hope to receive from good tenants, as these tenants clearly are.
23A Raurenga Avenue, Royal Oak is also a useful comparator. There is a risk that just relying on the premises close neighbours could lead to an inaccurate outcome. Perhaps Ms Zhou has a special network that enables her to outperform the market, for example. The advertised rent for the premises is $1,260.00 per week. This property is in a different suburb a couple of kilometres away. Its location is superior in my view because it is close to Cornwall Park and to a large supermarket and retail area. It is near major bus routes. The premises is not far from Te Papa Railway Station, but the Onehunga Line’s timetabling is erratic. The property includes a second lounge, has a fully-fenced section and an extra two carparks. 23A Raurenga looks better than the premises based on the limited information I have, and it is only $10.00 per week more than the premises’ original rent. Conclusion on market rent
Having considered all the evidence and the submissions, I conclude that the market rent for the premises in $1,250.00.
That figure is in proportion to 11B and C’s weekly rents. 23A Raurenga is better value for money based on the limited evidence I have, but it is possible it has fishhooks that naturally will not be mentioned in the inevitably relentlessly positive advertising blurb. Moreover, there will generally always be better or worse rental deals available in the market, this property is in a different (albeit in my view more desirable location) and it the weekly rent is not vastly out of step with the market rent level I have found for the premises.

Is the rent or proposed rent substantially more than the market rent?

The landlord’s rent increase is $100.00 more than the market rent.
Whether that is a “substantial” discrepancy is an evaluative question. $100.00 strikes me as being a considerable amount. In the context of tenants choosing premises of this type to live in, a difference of $100.00 per week would have an impact on their decision-making. Put another way, the tenants are being required to paid and are paying $100.00, or about 8 per cent more than they should be paying.
I am satisfied that the current rent is substantially above the market rent for the premises.

What should the rent be?

The weekly rent should remain at $1,250.00 per week for 12 months commencing from the date of the proposed rent increase, 28 December 2024.
The Tribunal therefore grants the tenants application to the extent that the rent is to remain the same as it was originally.
The landlord should repay any overpaid rent or credit it to the tenant’s future rent. Non-publication
The tenants seek non-publication of their names.
The Tribunal must, on the application of a party that has wholly or substantially succeeded in proceedings, order that the party’s name or identifying particulars not be published, unless the Tribunal considers that publication is in the public interest or is justified because of the party’s conduct or any other circumstances of the case.
The tenants have succeeded in their claim. Publication is not in the public interest nor justified by the tenants’ conduct or any other circumstances.
The Tribunal orders non-publication of the tenants’ names.

Tenancy Tribunal case 5051330 — Tenancy dispute

At a glance

Claims & awards

Tenancy Tribunal case 5051330 — Tenancy dispute

At a glance

Claims & awards

Order

Reasons

What is the market rent for the premises?

Is the rent or proposed rent substantially more than the market rent?

What should the rent be?

Topics & place

Residential Tenancies Act sections

Frequently asked questions

Order

Reasons

What is the market rent for the premises?

Is the rent or proposed rent substantially more than the market rent?

What should the rent be?

Topics & place

Residential Tenancies Act sections

Frequently asked questions