Saturday, September 1, 2012
Mike Butler: WOF warning for landlordsLabels: Mike Butler, Phil Heatley, Property investment
The poverty experts, who believe rental property owners only seeking short-term investment gains and tenants seek long-term tenancy stability, when the exact reverse is actually the case, want a capital gains tax for rental property.
Greens co-leader Metiria Turei tried to increase pressure for extending its insulation scheme when she told parliament "too many kids grow up in cold, damp homes."
Turei and the poverty experts seem unaware that the current home insulation and heating subsidies scheme is costly, mainly benefits licensed installers, and are set up in a way that is cheaper and more effective for landlords to ignore the subsidies and install the insulation themselves.
For instance, I installed insulation that would have cost $3886.10 after taking advantage of the subsidies for a total cost of $1726.34, saving $2159.76. The poor uptake of the subsidies is taken as a sign that landlords are not responding to the carrot so the poverty experts want the big stick of regulation to be waved.
They seem unaware that a heated, insulated home will still drip with condensation and grow mould if not ventilated. Amid the clamor about children living in cold homes, the professional poverty experts also seem unaware that insulation only lowers the cost of heating and reduces the scope for condensation. Mum or Dad still has to turn on the heater in winter, a reality that is often shocking for newcomers from the Pacific Islands.
Home insulation has only become an issue for poverty experts over the past 10 years, which is a period characterized by high immigration of people from hot climates. Many of these migrants, unaccustomed to the New Zealand climate, raise the temperature inside their flats and houses while sealing all windows and doors, which causes high levels of condensation and mould.
The pressure insulate is a push to get landlords to subsidize tenant living expenses, and comes at a time when landlords are paying about 35 percent more tax as the end of depreciation on buildings takes effect. No thought has gone into the reality that the tenant will end up paying for these increased costs.
Meanwhile, as one part of government tries to make life better for the poor, another part of government has banned non-complying fireplaces to achieve an arbitrary level of air cleanliness. This clampdown, which severely affected numerous quake-hit Christchurch residents through the past two winters, prevents the poor and everyone else from gathering firewood at no cost and burning it to keep warm.
at 4:38 PM