What was the outcome of Tenancy Tribunal case 4563789?

The tribunal order states: An application for suppression has been made in this case but no suppression

How much money was awarded in case 4563789?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4563789?

The dispute type was not classified.

Where can I read the official tribunal order for case 4563789?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9243637-Tenancy_Tribunal_Order.pdf.

What was the outcome of Tenancy Tribunal case 4563789?

The tribunal order states: An application for suppression has been made in this case but no suppression

How much money was awarded in case 4563789?

Verified claim lines are listed on this page.

What type of tenancy dispute was case 4563789?

The dispute type was not classified.

Where can I read the official tribunal order for case 4563789?

The official Ministry of Justice published order is available at https://forms.justice.govt.nz/search/Documents/TTV2/PDF/9243637-Tenancy_Tribunal_Order.pdf.

Unit/Flat 4, 365 Gloucester Street, Linwood, Christchurch Tenancy Tribunal Case 4563789 — Tenancy dispute

Order

An application for suppression has been made in this case but no suppression orders apply around publication of this decision.
The application is dismissed.

Reasons

Both parties attended the hearing.
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.”
In the case of a fixed term tenancy, any application must be filed no later than 3 months after the start of the tenancy or the last rent review (see s 25(2) RTA). This application was made within the required timeframe.
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. The limitation with bond data evidence is that it is generic and does not provide data in relation to specifics of a property such as number of bathrooms or garaging. The Evidence
The tenancy started on 2 May 2022 and was for a fixed term to 7 May 2023. The agreed rent at the start of the tenancy was $490 per week.
On renewal of the fixed term tenancy, the landlord gave 60 days notice of a rent increase to $550 per week. The rent increase took effect on 5 June 2023 and has been paid by the tenants.
The tenants have applied for a market rent assessment. They contend that the market rent for the property is in the vicinity of $490 per week.
The property was new at the start of the tenancy. It is an attached townhouse, in a block of 7. It has 2 bedrooms, two full bathrooms and a third toilet. It has off street parking but no garage.
The tenants referred to Market Rent data from Tenancy Services which show that 411 bonds were received for 2-bedroom houses in Linwood for the period 1 December 2021 to 31 May 2023 with a median rent of $460 per week and an upper quartile rent of $490 per week. It was common ground between the parties that this property would fall into the upper quartile of rents payable.
The tenants also referred to advertisements for other 2-bedroom townhouses in Linwood. The tenants provided 5 advertisements. Of those, three of the properties had one bathroom and were advertised for rent of $480, $490 and $495 per week. The other two were described as having two bathrooms and were advertised for rent at $500 and $519 per week. Of the advertisements provided by the tenants, the property that appears most comparable is the one advertised at $519 per week. That property may be eligible for a $200 power credit.
The landlord provided three reports it had generated from Core Logic to support the increased rent of $550 per week. The reports were prepared on different dates but are the only evidence the landlord used to assess the rent increase. Tenancy Services bond data was dismissed as not reflecting the landlord’s observations of the market. The Core Logic reports are not based on a particular suburb, but on comparable properties within 1.5km of these premises.
The Core Logic reports record the advertised rental for a property, not necessarily the rent paid by the tenant. The advertised rental ranges from $510 to $580 per week and is for properties with 2 bedrooms and 2 bathrooms. The tenant submitted that all the core logic properties had garaging, whereas this property does not. I do not accept that submission. The car icon the tenant referred to is also visible for this property. The icon depicts either a parking space or garaging.
The landlord’s data includes properties in Edgeware. While that suburb is reasonably proximate to the subject premises, it appears that advertised rents are higher than in Linwood. I have put little weight on “comparables” from Edgeware.
Both parties referred to a complex at 129 Tancred St as supporting their position. The tenant referred to unit 3 which was advertised for rent at $500 per week, whereas the landlord referred to unit 2 advertised for rent of $549.00 per week. This evidence is indicative of the range of rents sought for comparable properties in the vicinity of the subject premises.
I have considered the bond data, advertisements and Core Logic reports and weighed the limitations of each. I have put more weight on properties in the Linwood area, of similar size and with two bathrooms. All the comparables referred to were of similar age to this property. I assess the market rent for the premises at 4/365 Gloucester St to be $520 to $530 per week.
The question then becomes whether the rent of $550 per week is an amount substantially above what the market rate would be. The rent is $20 to $30 per week above my assessment of the market rent for the property. I do not consider that to be a substantial, significant or tangible difference.
The tenant has not proved on the balance of probabilities that the rent exceeds market rent by a “substantial amount”. The application is dismissed.
As the tenants were not successful with their application, I have not granted their request for suppression of their details.

Order

An application for suppression has been made in this case but no suppression orders apply around publication of this decision.
The application is dismissed.

Reasons

Both parties attended the hearing.
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.”
In the case of a fixed term tenancy, any application must be filed no later than 3 months after the start of the tenancy or the last rent review (see s 25(2) RTA). This application was made within the required timeframe.
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. The limitation with bond data evidence is that it is generic and does not provide data in relation to specifics of a property such as number of bathrooms or garaging. The Evidence
The tenancy started on 2 May 2022 and was for a fixed term to 7 May 2023. The agreed rent at the start of the tenancy was $490 per week.
On renewal of the fixed term tenancy, the landlord gave 60 days notice of a rent increase to $550 per week. The rent increase took effect on 5 June 2023 and has been paid by the tenants.
The tenants have applied for a market rent assessment. They contend that the market rent for the property is in the vicinity of $490 per week.
The property was new at the start of the tenancy. It is an attached townhouse, in a block of 7. It has 2 bedrooms, two full bathrooms and a third toilet. It has off street parking but no garage.
The tenants referred to Market Rent data from Tenancy Services which show that 411 bonds were received for 2-bedroom houses in Linwood for the period 1 December 2021 to 31 May 2023 with a median rent of $460 per week and an upper quartile rent of $490 per week. It was common ground between the parties that this property would fall into the upper quartile of rents payable.
The tenants also referred to advertisements for other 2-bedroom townhouses in Linwood. The tenants provided 5 advertisements. Of those, three of the properties had one bathroom and were advertised for rent of $480, $490 and $495 per week. The other two were described as having two bathrooms and were advertised for rent at $500 and $519 per week. Of the advertisements provided by the tenants, the property that appears most comparable is the one advertised at $519 per week. That property may be eligible for a $200 power credit.
The landlord provided three reports it had generated from Core Logic to support the increased rent of $550 per week. The reports were prepared on different dates but are the only evidence the landlord used to assess the rent increase. Tenancy Services bond data was dismissed as not reflecting the landlord’s observations of the market. The Core Logic reports are not based on a particular suburb, but on comparable properties within 1.5km of these premises.
The Core Logic reports record the advertised rental for a property, not necessarily the rent paid by the tenant. The advertised rental ranges from $510 to $580 per week and is for properties with 2 bedrooms and 2 bathrooms. The tenant submitted that all the core logic properties had garaging, whereas this property does not. I do not accept that submission. The car icon the tenant referred to is also visible for this property. The icon depicts either a parking space or garaging.
The landlord’s data includes properties in Edgeware. While that suburb is reasonably proximate to the subject premises, it appears that advertised rents are higher than in Linwood. I have put little weight on “comparables” from Edgeware.
Both parties referred to a complex at 129 Tancred St as supporting their position. The tenant referred to unit 3 which was advertised for rent at $500 per week, whereas the landlord referred to unit 2 advertised for rent of $549.00 per week. This evidence is indicative of the range of rents sought for comparable properties in the vicinity of the subject premises.
I have considered the bond data, advertisements and Core Logic reports and weighed the limitations of each. I have put more weight on properties in the Linwood area, of similar size and with two bathrooms. All the comparables referred to were of similar age to this property. I assess the market rent for the premises at 4/365 Gloucester St to be $520 to $530 per week.
The question then becomes whether the rent of $550 per week is an amount substantially above what the market rate would be. The rent is $20 to $30 per week above my assessment of the market rent for the property. I do not consider that to be a substantial, significant or tangible difference.
The tenant has not proved on the balance of probabilities that the rent exceeds market rent by a “substantial amount”. The application is dismissed.
As the tenants were not successful with their application, I have not granted their request for suppression of their details.

Tenancy Tribunal case 4563789 — Tenancy dispute at Unit/Flat 4, 365 Gloucester Street, Linwood, Christchurch

At a glance

Claims & awards

Tenancy Tribunal case 4563789 — Tenancy dispute at Unit/Flat 4, 365 Gloucester Street, Linwood, Christchurch

At a glance

Claims & awards

Order

Reasons

Topics & place

Residential Tenancies Act sections

Property management

Frequently asked questions

Order

Reasons

Topics & place

Residential Tenancies Act sections

Property management

Frequently asked questions