What was Tenancy Tribunal case 5093552 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 5093552?

Filing Fee: $27.00 awarded to tenant

What type of tenancy dispute was case 5093552?

The dispute type was not classified.

Where can I read the official tribunal order for case 5093552?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11504294-Tribunal_Order_Redacted.pdf.

What was Tenancy Tribunal case 5093552 about?

The tribunal order states: An application for suppression has been made in this case, and the Tribunal

How much money was awarded in case 5093552?

Filing Fee: $27.00 awarded to tenant

What type of tenancy dispute was case 5093552?

The dispute type was not classified.

Where can I read the official tribunal order for case 5093552?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/11504294-Tribunal_Order_Redacted.pdf.

14 Atlantis Place, Totara Vale, Auckland 0629 Tenancy Tribunal Case 5093552 — Tenancy dispute

Claims and awards in Tenancy Tribunal application 5093552 — net $27.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$27.00
Total payable by Landlord to Tenant	$27.00

Claims and awards in Tenancy Tribunal application 5093552 — net $27.00 NZD. Amounts reconciled from the published order (claims sum and net total). Verify on MoJ.
Claim	Tenant	Reason
Filing fee reimbursement	$27.00	Filing fee reimbursement
Net award	$27.00
Total payable by Landlord to Tenant	$27.00

Order

An application for suppression has been made in this case, and the Tribunal orders suppression of the Tenant name and identifying details.
The Tribunal orders that the rent to apply to this tenancy from 14 January 2025 is $620.00, which the Tribunal assess as the market rent for these premises.
The landlord must pay the tenant $27.00.

Reasons

Both parties attended the hearing. The Property Manager attended the hearing but the owner, Miao Li represented herself. The owner had the assistance of a mandarin interpreter.
The tenancy began on 10 February 2021 and is due to end on 1 April 2025 as the tenants have given notice to terminate the tenancy.
The tenant has applied for an order in relation to the rent increase on the basis that they consider it to be above the market rent for the premises.
On 10 November 2024 the landlord gave notice that the rent for the premises would increase from $580.00 to $820.00 per week.
The notice also stated that the new rent covered the cost of garden maintenance, lawn mowing and internet.
The tenant’s application was filed on 2 December 2024. The hearing to determine the matter was allocated after the date that the rent was due to increase. For this reason, the tenant sought clarification from the Tribunal as to whether they should continue to pay the current rent of $580.00 per week from 14 January 2025 or the increased amount of $820.00.
On 19 December 2024 the Tribunal issued an Interim Order that the tenant should pay $620.00 per week from 14 January 2025 until the Tribunal issues a decision on the application.
On 28 January 2025 the Tribunal made an order adjourning the hearing to enable the owner to attend given that there had been a break down in the relationship between she and her agent. The order stated that the rent increase was suspended, and the tenant should continue to pay $580.00 per week from 14 January 2025 until the substantive hearing. It seems that this part of the order was made in error given the earlier interim order.
The market rent provided in this order for these premises will apply from 14 January 2025. Market rent
The tenant has applied for a market rent assessment. Sections 25(1) and (3) Residential Tenancies Act 1986 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 tenant must prove on the balance of probabilities that the rent exceeds market rent by a “substantial amount”. The term 'substantial' is not defined in the RTA, but it is the opposite of ‘minor’ or ‘insignificant’. Some earlier Tribunal cases suggested a 'rule of thumb' of 10% over market rent. However, a rule of thumb based on a specific percentage has no legal status and is not appropriate where rents rise at a rate significantly above income inflation.
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. These terms are not defined by the Act. The Oxford English dictionary defines willing as: "having a ready will; disposed to consent or comply; ready to do (what is specified or implied) without reluctance"; and reasonable as "having sound judgement; sensible ... not asking for too much ... not extravagant or excessive; moderate".
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 evidence for comparable rents is usually 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 qualitative information available for comparison. 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.
It is also common for parties to refer to the 'market rent' statistics published by Tenancy Services. These statistics cover the rents charged for tenancies where bonds have been lodged over the preceding 6 months. The statistics include median rent as well as upper and lower quartile. Tenant’s case
There has been no rent increase for these premises since 2021. The tenant acknowledges that the rent should be increased but submits that the increase sought by the landlord is excessive.
The premises are a two-bedroom, two-bathroom home. There are two dwellings at the property, but the tenancy is only for this dwelling. The other dwelling consists of a garage which has been converted for living as well as the upstairs (studio) area. From 6 November 2024 the landlord has lived in the garage/studio space.
In the rent increase notice it states that the increase is to include garden maintenance and internet. This conflicts with the tenancy agreement signed at the beginning of the tenancy which records that the tenant is to be responsible for lawns, gardens and internet. The tenant was also told that the rent increase is to include insurance for the premises and camera surveillance.
The tenancy agreement records that the tenant is responsible for power and water costs, and it seems this has not changed even since the landlord has moved into the adjoining property. The notice also records that the electricity and water bills are to be shared based on the number of residents. That is because there is no sub meter for either water or power so no way of determining how much of these is being used by the tenant and the landlord. This issue is not for the Tribunal to determine today.
The tenant referred to the Tenancy Services website which records that the average rent for a home in Totara Vale is $740.00. But that figure does not take account of the number of bedrooms or amenities.
The tenant also referred to the upper quartile rent figure for a two bedroom home in Totara Vale, which is $600.00. When asked whether he considers the premises to be lower, medium, or upper quartile as defined on the website the tenant said that it was between lower and medium quartile. He said this was due to the landlord also now living on the premises.
The tenant also referred to Trade Me advertisements for two-bedroom premises in the Totara Vale area. The rent for those premises were $550.00 and $490.00 respectively, but both only had one bathroom. Landlord’s case
The landlord said that she renovated the premises in 2019 both inside and outside including replacing the carpet with wooden flooring. She also said that the garage was converted into a bedroom and doors were installed. She said the garage conversion started with the previous owners who had council consent and she finished it. I note that the garage is not included in this tenancy.
The landlord did not produce any photographs of the premises after the renovation but there were general photographs showing a fairly modern kitchen and an open plan living area.
The landlord said that there had been no rent increase since 2021. She also said that she had not lived in the other dwelling until 6 November 2021 due to the COVID situation and her return to China has been delayed due to these proceedings.
In support of the rent increase the landlord said that most two-bedroom properties have only one bathroom whereas this one has two.
The landlord referred to a newspaper article dated 12 December 2024 which referred to a statement by Chris Bishop, Minster of Housing: “The previous Government’s war on landlords ultimately caused worse outcomes for tenants: rents up by $170 per week from 2017 to 2023, the social housing waitlist increasing by about 20,000 families, and thousands of families living in emergency housing motels.”
It seems that the landlord suggests that based on this article the rent for her tenancy should have increased by $170.00.
The landlord referred to a property owned by her friend in Ellice Road, but no significant details were provided in relation to whether that property was comparable to this one.
When asked whether she considered these premises fit in to the lower, medium or upper quartile she said upper. Her reason for this was that there is a nice garden which she said the tenants could enjoy by themselves when she is not living there. Also, when she is not there the tenants would have parking for 4 cars. She also referred to the two bathrooms, one of which has a new shower due to a leak.
When asked whether there have been any upgrades to the premises over the past four years the landlord replied “no”.
The landlord had partly justified the increase due to the landlord taking over the cost of lawns, gardens, security cameras and insurance. The first two are included in the tenancy agreement and are costs for the tenant and the cost of installing security cameras and insurance is not normally a cost that would be passed on to a tenant. Analysis
The question to be determined, is whether the rent charged for the premises is at a market rate, and if not, whether the Tribunal should substitute its own assessment of what a market rate will be.
The parties submitted evidence which I have taken into consideration. I conclude that weekly rent of $820.00 for these premises is not market rent. I have reached that conclusion having considered two particular groups of evidence, that is the tenancy bond data and also the advertisements.
As at the date of hearing, based on the tenancy bond data between 1 July 2024 and 31 December 2024 for a two-bedroom house in Totara Vale the following data is available:
To apply any of the bond data assessments, it is necessary to consider whether the premises should fairly fall within the lower quartile, median or upper quartile ranges.
The landlord considered the premises to be in the upper range and the tenant said it was between the lower and median range.
On the evidence the premises do not fall within the upper quartile of premises. To do so would require features such as location, amenities and the standard and quality of the property to be at the higher end. For these premises I take account of the age of the premises and the basic amenities.
In relation to the advertised premises the listings indicate a level of rent below what the landlord would like to receive for these premises.
To determine the market rent I have considered the Trade Me advertisements, including where the rent is less but where they only have one bathroom and the amount of the bond data between the lower, median and upper quartile. Taking account of these factors I consider the market rent for this tenancy to be $620.00 per week. The market rent would have been higher had the tenants had the exclusive use of the premises as well as the garage and studio.
The question then becomes whether the rent increase is an amount substantially above what the market rate would be, and I find it is. The increase from $580.00 to $620.00 is a 7% increase whereas the increase from $580.00 to $820.00 is a 41.5% increase. It is a substantial increase above market rate.
The Tribunal substitutes its own assessment that the market rent for these premises will be $620.00 per week, and that rent is to apply from 14 January 2025.
Because the tenant has substantially succeeded with the claim, I have reimbursed the filing fee.

Tenancy Tribunal case 5093552 — Tenancy dispute at 14 Atlantis Place, Totara Vale, Auckland 0629

At a glance

Tenancy Tribunal case 5093552 — Tenancy dispute at 14 Atlantis Place, Totara Vale, Auckland 0629

At a glance

Award balance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions

Award balance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Key findings

Frequently asked questions