One of the most notable proposed adjustments under the National-led government is the reversal of the automatic rollover of fixed-term tenancies to periodic tenancies, a policy initially introduced by the Labour government. This change is aimed at fostering greater flexibility for both landlords and tenants, allowing them to negotiate terms more freely rather than defaulting to a periodic tenancy.

Understanding the Change

Under the proposed new law, the fixed-term tenancy will automatically convert to a periodic tenancy unless a landlord or tenant gives notice to end the fixed-term tenancy within 21 – 90 days before the fixed term ends. 

No specific reasons to terminate are required, if the parties wish to renew the fixed term they will need to take further steps to do this.

Impact on Landlords

Landlords will have more control over the duration of fixed-term leases. They will be able to set an agreed timeframe for tenancy upfront, making it easier to manage leases without automatically rolling over into periodic tenancies. This change aims to encourage landlords to offer fixed-term leases by removing the current obligation to meet specific criteria to end a lease.

Landlords will have the option to either let the fixed-term lease roll into a periodic tenancy, terminate the tenancy at the end of the fixed term (with proper notice), or negotiate a new fixed-term lease. This flexibility is expected to create a more dynamic rental market, allowing landlords and tenants to negotiate terms that better suit their needs, ultimately fostering a more balanced and flexible housing sector.

What Tenants Need to Know

For tenants, this change means that if their fixed-term tenancy ends next year, it will automatically roll over to a periodic lease. Tenants will have to actively engage in discussions with their landlords should they wish to renew their fixed-term tenancy or negotiate new terms. 

Professional Property Management: A Crucial Role

In this new rental landscape, professional property management services become increasingly important. Experienced property managers can help both landlords and tenants navigate these changes smoothly. For landlords, professional property management ensures that their properties are managed efficiently, tenancy agreements are negotiated fairly, and any transition from fixed-term to new agreements is handled seamlessly. 

For tenants, having a property manager can provide peace of mind. Property managers act as intermediaries, ensuring that tenants’ rights are protected and that any negotiations with landlords are conducted professionally. In a city like Auckland, where the rental market can be particularly competitive, the expertise of rental property management professionals can be invaluable.

As we navigate these changes in the rental property landscape, staying informed and proactive is key. Whether you’re a landlord looking to maximise the potential of your investment or a tenant seeking a home that fits your needs, professional property management can make all the difference.

Get in touch with us today to learn more about how these changes could impact you and how we can help you navigate this new terrain. Our expert team is here to provide the support and guidance you need to make the most out of your rental property experience.