Election year and why renting legislation should be left alone
Election year has arrived, and while political debate always ramps up during a General Election, housing and renting policy once again sits under the spotlight. Rental legislation in New Zealand has changed significantly over the past few years, and overseas developments suggest there are important lessons worth paying attention to.
Over the Christmas break, an article in the UK Daily Telegraph caught my eye, titled Landlord exodus forces New Zealand and Portugal to rethink crackdown. It prompted reflection on how New Zealand’s approach to rental legislation has shifted and whether those changes are delivering better outcomes for both landlords and tenants.
The article explored how Portugal and New Zealand have both softened earlier landlord restrictions to encourage investment in rental housing. In contrast, the UK Government is pressing ahead with policies such as banning no-fault evictions and introducing lengthy delays, potentially up to eight months, for landlords to regain possession of their properties.
The Telegraph argues the UK should learn from New Zealand’s reversal of many rental law changes introduced by the Labour Government following the 2017 election under Jacinda Ardern, particularly the removal of landlords’ ability to end a tenancy without a specific reason.
At the time, I supported those reforms. It felt reasonable that landlords should provide a valid reason to end a tenancy. In practice, however, the changes created real challenges, especially when dealing with antisocial behaviour under the problematic “three strikes in 90 days” rule.
Now, more than 12 months after these reforms were rolled back, landlords are once again able to issue 90 days’ notice without providing a reason. At the same time, more landlord-friendly measures have been introduced, including the ability to deduct 100 percent of mortgage interest costs from rental income.
While these changes clearly benefit landlords, the more important question is whether tenants are worse off as a result.
I would argue the opposite. The data suggests tenants may actually be better off.
The Telegraph article highlights how restrictive landlord legislation can reduce rental supply, leading to higher rents due to increased competition. New Zealand data supports this argument. According to OneHub powered by Trade Me, national rents fell by around two percent in December 2025 compared with December 2024. At the same time, rental listings increased by four percent, while tenant search activity dropped by two percent.
With interest rates easing and landlords able to offset interest costs again, there is also less pressure to raise rents to cover rising expenses. This easing of financial strain on landlords helps stabilise rents for tenants.
There has been discussion around whether a Capital Gains Tax would push rents higher. In my view, it would not. Capital gains are realised only when a property is sold and do not directly affect the day-to-day cashflow of running a rental property.
There is an irony in the rental debate. Renting groups often lean left politically, yet tenants may actually benefit more when governments take a lighter-touch approach to rental markets rather than introducing anti-landlord policies.
The current Government has also introduced pet-friendly legislation, a positive step that directly benefits tenants without discouraging rental supply.
Importantly, the return of no-cause evictions has not led to widespread unfair evictions. The industry is now far better educated around obligations under the Residential Tenancies Act. Strong protections remain in place against retaliatory evictions, with significant exemplary damages available where landlords breach the law.
It is striking how little attention the housing crisis receives today compared with 2017. Under Ardern’s Government, housing reform, Kiwibuild, and renting legislation dominated the policy agenda.
Perhaps this shift reflects a growing recognition that less government intervention may be the better approach. As we head into election year, regardless of who forms the next Government, policy should focus on increasing housing supply rather than reintroducing restrictive rental legislation.
Reforms that enable development and ensure supply meets demand, including proposed changes to the Resource Management Act, are a far more productive starting point.
As election year unfolds, the focus should remain on policies that genuinely improve outcomes, not those that restrict supply. The debate is worth having.
