Tax exemption discriminates against ordinary landlords

Housing Minister Megan Woods says upcoming tax legislation will give the exemption to new and existing build-to-rent developments rules in perpetuity.
The exemption will apply retrospectively from 1 October 2021. Owners of build-to-rent assets can claim interest costs relating to these assets for as long as the asset is held and operated as a build-to-rent development.
The proposed requirements for the new asset class include:

• That tenants must be offered a fixed-term tenancy of at least 10 years with the ability to give 56 days’ notice of termination, but they may agree to or request other tenancy offers; 
• The developments must have at least 20 dwellings in one or more buildings that comprise a single development, on either a single parcel of land or multiple contiguous parcels;
• The dwellings and any common land or facilities for those dwellings must  have a single owner;
• Dwellings can be held in one or more titles;
• The buildings that a build-to-rent dwelling is in, can include other dwellings or commercial premises that do not form part of the build-to-rent development;
• and the dwellings are used or available for rent under the Residential Tenancies Act.

“Minister Woods says build-to-rent developers provide high quality rental housing so these tax benefits are going to benefit high income earning tenants rather than the vast majority of tenants as a consequence.”

King says the vast majority of tenants cannot afford brand new, high end accommodation. “They want well maintained, warm, dry but ultimately good value rental accommodation.”