It is largely accepted that buying a rental is different to buying a home. Investors buy on projected yield and growth making purchasing a rental
a somewhat mechanical process (if you repeat it often enough). But what if you are buying a rental and an existing tenancy? Should
you broaden your due diligence and look at anything other than the numbers? Take a look at the recent Tribunal order, Chamberlain, Timothy Joel vs Property Brokers Limited Wanganui – Agent for Tony and Simon Alatett (NZ) Ltd, and
the answer should be a resounding Hell yeah!
Background
Mr. Chamberlain rented a Whanganui property from Tony and Simon Alatett (NZ) Ltd. During the course of the tenancy, the property was sold to Ms.
Jaiayamma Vitta though the management company remained the same. Mr. Chamberlain brought an application against the original landlords for improper
maintenance of the property and was awarded $2,935.86 in compensation and exemplary damages.
The Tribunal ordered that Ms. Jaiayamma Vitta be joined as a party to Mr. Chamberlain’s application seeing that at the time of the order, she had become the legal owner of the property.
The Tribunal gave leave for Mr. Chamberlain to amend his application and adjourned the hearing until October which brings us to the published order itself.
Outcomes
Adjudicator Lyon made the following order:
- That Ms. Vitta to complete various specified work or suffer immediate rent offsets/reduction
- That Ms. Vitta pay $1,420.57 to Mr. Chamberlain made up of $1,000 in exemplary damage and $420,57 as rent compensation to address the reduction of
tenancy quality due to the disrepair
The adjudicator’s reasoning for compensation, exemplary damage, and work orders are straightforward enough. Of...
