Tenancy Agreements Explained
Published: November 6, 2024
A well-drafted tenancy agreement protects both landlords and tenants by clearly defining expectations, responsibilities, and terms. Understanding what should be included ensures legal compliance and prevents disputes.
Key Takeaways
- • Written agreements are legally required in New Zealand
- • Must be provided within 12 working days of tenancy starting
- • Cannot override tenant rights under the Residential Tenancies Act
- • Should clearly specify all terms, conditions, and responsibilities
Legal Requirements
Under the Residential Tenancies Act 1986, all tenancy agreements must be in writing. Verbal agreements are not enforceable, though a tenancy still exists under the Act.
Important: Landlords must provide a signed tenancy agreement within 12 working days of the tenancy starting. Failure to do so can result in up to $1,000 in exemplary damages. Use the official Tenancy Services agreement template.
Essential Clauses
Parties & Property
- • Full names and contact details of all landlords and tenants
- • Property address and description
- • Property manager details (if applicable)
- • Chattels list (furniture and appliances included)
Tenancy Terms
- • Tenancy type (fixed-term or periodic)
- • Start date and end date (if fixed-term)
- • Notice periods for ending tenancy
- • Maximum number of occupants
Financial Terms
- • Weekly or monthly rent amount
- • Payment method and due date
- • Bank account details for payments
- • Bond amount (maximum 4 weeks rent)
- • Who pays for utilities
Fixed-Term vs Periodic
Fixed-Term Tenancy
Specific start and end date (e.g., 12 months)
- ✓ Guaranteed occupancy for the term
- ✓ Cannot increase rent during term
- ✓ Good for screening new tenants
- • Neither party can end early without agreement
- • Automatically becomes periodic if not renewed
Periodic Tenancy
No fixed end date, continues indefinitely
- ✓ Maximum flexibility for tenants
- ✓ Most common in New Zealand
- ✓ Suitable for long-term tenancies
- • Tenant: 28 days notice to leave
- • Landlord: 90 days notice (with grounds)
Required Additional Statements
Insulation Statement
Details about ceiling and underfloor insulation - must be provided before tenancy starts
Healthy Homes Statement
Confirms compliance with all five Healthy Homes Standards - within 90 days
Smoke Alarm Statement
Confirms working smoke alarms installed - checked within 28 days
What You Cannot Include
Warning: Clauses that override the Residential Tenancies Act are unlawful:
- ✗ Bond higher than 4 weeks rent
- ✗ Waiving tenant's right to quiet enjoyment
- ✗ Professional cleaning fees (can only claim actual costs)
- ✗ Preventing tenant from having guests
- ✗ Blanket pet bans (must consider reasonably)
- ✗ Limiting access to Tenancy Tribunal
Common Mistakes to Avoid
Using Outdated Templates
Always use current Tenancy Services templates or have agreements reviewed professionally
Missing Required Statements
Failing to provide insulation, Healthy Homes, or smoke alarm statements can result in penalties
Unlawful Clauses
Including clauses that contradict the RTA makes them unenforceable and may result in penalties
Negotiating Terms and Conditions
While tenancy agreements must comply with the RTA, there's room for negotiation on certain terms that benefit both parties:
Negotiable Terms
Property Use:
- • Pet policies and conditions
- • Home business permissions
- • Garden maintenance responsibilities
- • Parking arrangements
- • Guest policies and duration limits
Financial Arrangements:
- • Utility payment responsibilities
- • Payment frequency (weekly/monthly)
- • Rent review mechanisms
- • Maintenance cost sharing
- • Insurance arrangements
Negotiation Best Practices
- • Document everything: Put all agreed changes in writing
- • Be reasonable: Consider both parties' needs and constraints
- • Know the law: Ensure all terms comply with the RTA
- • Professional advice: Consult experts for complex arrangements
- • Clear communication: Avoid ambiguous language or terms
Digital vs Paper Agreements
Modern property management increasingly uses digital solutions for tenancy agreements, offering benefits for both landlords and tenants:
Digital Agreements
Advantages:
- • Instant delivery and signing
- • Automatic backups and storage
- • Easy updates and amendments
- • Integrated with property management systems
- • Environmentally friendly
- • Audit trails for legal compliance
Requirements:
- • Electronic signature capability
- • Secure document storage
- • Compliance with Electronic Transactions Act
Paper Agreements
When to Use:
- • Tenant preference or limited digital access
- • Complex agreements requiring detailed review
- • Legal requirements for physical signatures
- • Backup for digital systems
Considerations:
- • Secure physical storage required
- • Risk of loss or damage
- • Slower processing and delivery
- • Manual filing and organization
Amendments and Variations
Tenancy agreements may need to be modified during the tenancy. Understanding the proper procedures protects both parties:
When Amendments Are Needed
- • Change of circumstances: New occupants, pets, or property use
- • Property improvements: Additional chattels or modifications
- • Service changes: Utility arrangements or maintenance responsibilities
- • Legal updates: New compliance requirements or law changes
- • Rent adjustments: Market reviews or property improvements
Amendment Process
1. Mutual Agreement Required
Both landlord and tenant must agree to any changes. Unilateral modifications are not legally binding.
2. Written Documentation
All amendments must be in writing, signed by both parties, and attached to the original agreement.
3. Legal Compliance Check
Ensure all changes comply with the RTA and don't override tenant rights or landlord obligations.
International Tenants and Special Considerations
New Zealand's diverse rental market includes many international tenants who may need additional support understanding local tenancy laws:
Additional Documentation for International Tenants
- • Visa status verification: Ensure legal right to rent in New Zealand
- • Income verification: International bank statements or employment letters
- • Reference checks: Previous landlords or character references
- • Emergency contacts: Local and overseas contact information
- • Cultural orientation: Explanation of New Zealand tenancy customs
Communication and Support
- • Language support: Translated documents or interpreter services
- • Cultural sensitivity: Understanding different housing expectations
- • Legal education: Explaining tenant rights and responsibilities
- • Local resources: Information about community services and support
- • Regular check-ins: Ensuring understanding and addressing concerns
How Climber Property Helps
Current templates: Up-to-date agreements that comply with all legal requirements
Complete documentation: All required statements provided on time
Digital management: Secure storage and easy access to all tenancy documents
Professional negotiation: Balanced agreements that protect all parties
Amendment support: Proper procedures for agreement modifications
International tenant support: Specialized assistance for overseas tenants
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