How to Conduct a Rent Review in NZ (RTA 1986 Process)

A rent review in a New Zealand residential tenancy is the process by which the landlord increases the rent. Under Residential Tenancies Act 1986 (RTA 1986) ss.24, 24A, and related provisions, rent increases are tightly regulated: minimum 60 days’ written notice, a maximum of one increase per 12-month period, and the tenant’s right to challenge an excessive increase through the Tenancy Tribunal. This how-to walks through the process step by step.

Step 1 — Confirm Eligibility to Increase

Frequency rule — s.24A

Under RTA 1986 s.24A, rent may not be increased within 12 months of:

• The start of the tenancy (for the first increase), OR
• The last rent increase (for subsequent increases)

The 12-month clock is measured by the tenancy and the property combination. If the tenant moves out and a new tenant moves in, the 12-month clock resets.

A rent increase that breaches s.24A is invalid. The tenant continues to owe only the previous rent.

Fixed-term tenancies

For a fixed-term tenancy, rent may only be increased during the term if the tenancy agreement specifies the new rent or the formula for calculating it (RTA 1986 s.24(2)). Otherwise, the rent is fixed for the term and can only be increased on rollover to periodic.

Step 2 — Calculate the New Rent

The landlord can set the new rent at any amount, subject to two constraints:

1. The increase must be lawful (i.e. the s.24A frequency rule satisfied and the increase is not retaliatory).
2. The new rent must not be excessive under RTA 1986 s.25 — though the test is applied only on tenant challenge, not at notice issuance.

There is no statutory cap on the size of the increase. NZ does not have rent caps or rent control. However, the Tribunal can order a reduction under s.25 if the tenant proves the new rent “exceeds the market rent” for similar properties in similar condition.

In practice, landlords typically benchmark against:

• Tenancy Services Market Rent data: https://www.tenancy.govt.nz/rent-bond-and-bills/market-rent/
• Realestate.co.nz / Trade Me Property comparable listings
• Published Realtors NZ rental market reports

Step 3 — Prepare the Rent Increase Notice

Under RTA 1986 s.24(1), the notice must:

• Be in writing (email is acceptable if the agreement permits electronic service)
• State the current rent
• State the new rent
• State the date the new rent takes effect — at least 60 days from the date the notice is served
• Be signed by the landlord or landlord’s agent

A standard notice template is published by Tenancy Services at https://www.tenancy.govt.nz/rent-bond-and-bills/rent/rent-increases/. Use of the template is not mandatory but is strongly recommended.

Template content

A compliant notice typically reads:

“To [tenant name], at [premises address]:

This is notice that the rent for the above premises will increase from [current rent, e.g. $500] per week to [new rent, e.g. $530] per week.

The new rent takes effect from [date — at least 60 days from notice date].

Signed: [landlord/agent name and signature] Date of notice: [today’s date]“

Step 4 — Serve the Notice

Service must comply with RTA 1986 s.136 — the notice may be:

• Posted to the tenant’s address for service (with proof of postage) — deemed served on the 5th working day after posting
• Delivered in person to the tenant or left at the premises
• Emailed if the tenancy agreement specifies an email address for service of notices

Keep a copy of the notice and proof of service. If the tenant later disputes the increase, the date of service determines whether the 60-day window was satisfied.

Step 5 — Wait the 60-Day Notice Period

The new rent takes effect on the date specified in the notice (which must be at least 60 days from service). The tenant may continue to pay the old rent during the notice period; the new rent is owed only from the effective date forward.

Step 6 — Tenant’s Challenge Rights

Excessive rent challenge — s.25

Within 3 months of the rent increase taking effect, the tenant may apply to the Tenancy Tribunal under RTA 1986 s.25 for an order reducing the rent to a market level.

The Tribunal considers:

• Comparable rents for similar properties in the same area
• The condition of the property (Healthy Homes compliance, repairs, included chattels)
• Any unique factors (e.g. proximity to amenities, parking, view)

If the Tribunal finds the increase exceeds market rent, it may reduce the rent and order refund of overpaid amounts. The reduction order also limits the next increase (it applies to the new lower amount).

Retaliatory increase challenge — s.54A

If the rent increase appears to be a reprisal for the tenant exercising a legal right (e.g. complaining about repairs, requesting Healthy Homes compliance), the tenant may challenge under s.54A. The Tribunal can set aside a retaliatory notice.

Step 7 — Tenant’s Practical Response

If the tenant accepts the increase:

• Update the standing payment / direct debit
• Acknowledge the new amount in writing (helpful for record keeping)

If the tenant disputes the increase:

• Continue paying the old rent until 60 days have elapsed
• Apply to the Tribunal under s.25 for a market rent assessment
• Provide comparable rental data as evidence

Tenants should not stop paying rent altogether — that triggers the rent-arrears process under RTA 1986 s.55, which can lead to termination.

Common Rent Review Mistakes

Healthy Homes Compliance and Rent Reviews

From 1 July 2025, the Healthy Homes Standards must be fully complied with on the first day of any new or renewed tenancy. Where a property fails to comply, the tenant may:

• Apply for a Tribunal order requiring compliance
• Apply to reduce the rent to reflect substandard accommodation
• Recover compensation for substandard living conditions

A landlord planning a rent increase should ensure full Healthy Homes compliance first — an increase on a non-compliant property is vulnerable to challenge.

Healthy Homes information: https://www.tenancy.govt.nz/healthy-homes/

Practical Workflow Checklist

1. Confirm 12 months have passed since tenancy start or last increase
2. Confirm Healthy Homes compliance and document if necessary
3. Benchmark against Tenancy Services Market Rent data
4. Prepare written notice with current and new rent and effective date (≥60 days)
5. Serve the notice by an approved method
6. Keep proof of service
7. Diary the effective date and update standing instructions if managed
8. Update internal records (rent ledger, tenant communication file)

Cross-Reference to Other Provisions

The rent review intersects with several RTA 1986 provisions:

Where to Get Help

• Tenancy Services helpline: 0800 TENANCY (0800 836 262)
• Tenancy Services rent guidance: https://www.tenancy.govt.nz/rent-bond-and-bills/rent/
• Citizens Advice Bureau: https://www.cab.org.nz/

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Disclaimer

Legal information, not legal advice. MmowW Scrib🐮 is operated by a licensed Gyoseishoshi (行政書士) office in Japan. We are not New Zealand lawyers or licensed immigration advisers.

Sources

• Tenancy Services rent increases: https://www.tenancy.govt.nz/rent-bond-and-bills/rent/rent-increases/
• Tenancy Services Market Rent: https://www.tenancy.govt.nz/rent-bond-and-bills/market-rent/
• Residential Tenancies Act 1986: https://www.legislation.govt.nz/act/public/1986/0120/latest/DLM94278.html
• Tenancy Services hub: https://www.tenancy.govt.nz/