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Renters Stuck In Cold Houses With Big Power Bills

Fuseworks Media
Fuseworks Media

New Zealanders are notorious for sitting in cold, damp houses huddled together on the couch wrapped in blankets. KATE CHAPMAN of NZPA looks at whether the Government's insulation subsidy scheme will make any difference for those who don't own their home.

Wellington, Sept 29 NZPA - Renters earn a low-income, have high power bills and live in the country's worst houses, many of which are "past their use by date", an advocacy group says.

In the May budget the Government allocated $323.3 million over four years to fit houses built before 2000 with insulation and clean heating.

Under the scheme homeowners are eligible for grants to cover a third of insulation costs -- capped at $1300 -- and a further $500 to buy clean heating devices.

Community Services Card holders can get $1800 for insulation and a further $1200 for heating.

Landlords of card-holding tenants are entitled to $1800 for insulation and $500 for heating.

The third of New Zealanders who do not own their own home rely on their landlord to pick up the cheque.

Energy and Resources Minister Gerry Brownlee released figures earlier this month that showed of the 8000 houses retrofitted in the first eight weeks (July and August) of the scheme 11 percent were private rental properties.

Of those, 8 percent were rented by low-income earners and 3 percent by the general population.

Helen Gatonyi, manager of the Tenants Protection Association, said landlords of the worst houses had "no interest" in improving their properties.

"They're getting what they want from it until such time as they flick them off for redevelopment or what(ever).

"That small number of landlords are not going to take (the insulation subsidy) up."

Other landlords do not have the spare money to pay the rest of the costs, Ms Gatonyi told NZPA.

A register of rental properties and ensuring they met certain standards were ways of increasing the quality of rented homes, she said.

Much of the rental housing stock was "past its use by date".

"Irrespective of your income a landlord should indeed provide a property that meets a certain standard.

"If they were providing the house to that standard, then they would be more likely to take up this grant."

However, Ms Gatonyi congratulated the Government for the insulation scheme saying if more homes were insulated there would be less pressure on the national grid and "anything that saves electricity is good, so that's cost effective in itself".

The insulation scheme was a collaboration between the Government and the Green Party. It was the second of its kind.

The Green Party and the previous Labour government agreed to the 15-year $1 billion household insulation scheme.

National scrapped that scheme after the election saying it was not properly costed and would not go ahead.

Mr Brownlee said there were clear advantages for landlords under the insulation scheme and he was very happy with it.

The Energy Efficiency and Conservation Authority (EECA), which is administering the scheme, was working with the Property Investors Association to make sure they know about the benefits, he said.

"As more landlords become aware of the proposals that are out there then I think you'll see an increase in the number of rental properties that are being insulated."

The scheme was based on the house and income level of the occupants, not the income level of the owner

In an EECA survey of landlords 60 percent said a government subsidy would encourage them to insulate their rental properties.

Forty percent said they would insulate if it was compulsory.

There was a very small group of landlords with houses of "such a condition" that they might not meet the criteria for the loan anyway, Mr Brownlee told NZPA.

In general, tenants stay in warm dry houses for four years, compared to an average one year tenure for cold houses, he said.

"Most of the critics (of the scheme) seem not to appreciate that this is a scheme that is only two months old."

Martin Evans, president of the New Zealand Property Investors Federation, said his organisation encouraged its members to make their properties energy efficient.

There was a surplus of rental properties on the market and having insulation was a selling point, Mr Evans said.

Landlords should tell potential tenants about the health and heat retention benefits of an insulated house, he said.

Insulation also meant tenants were less likely to leave during winter.

There would always be landlords who didn't care, but they were not educated and probably did not belong to the federation, Mr Evans said.

"They're cheap and the tenants will take them cause it's all they can afford and they just sit there with their woollen hats and scarves and all that on and try and keep warm.

"We say well, `you've got to look after your customers'."

Maori Party MP Rahui Katene said her party was worried about the up-take of the scheme by landlords as there were no incentives for them to do so.

It is Maori Party policy to expand the retrofit of homes and it fought for that as part of its deal with the Government to support an amended emissions trading scheme.

The Maori Party would put pressure on Housing New Zealand to finish the insulation of its housing stock first, Ms Katene said.

The current insulation scheme was a "good option" for landlords to increase the value of their property and to find satisfied long-term tenants, Ms Katene told NZPA.

"It makes good economic sense whichever way you look at it."

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