A great step forward by the Government to mandate that insulation must be installed in the ceilings and underfloor areas of rental properties, but when you do the math it’s a bit like the Finance Minister’s “surprise budget surplus” – it simply doesn’t make sense.

The Government states that there are 270,000 homes classified as privately owned rental properties which are inadequately insulated, but this number includes approximately 100,000 homes that will be exempt from the new requirements because they cannot be insulated due to the physical constraints imposed by their original design.  Whilst this constraint is totally understandable, it follows that the 100,000 homes so exempted will remain in the rental pool and yet the Cabinet Briefing Paper does not indicate that any alternative means of improving the lived in environment has been considered, let alone expressing any concern for those families still having to live in those homes and remain exposed to the threat of an unhealthy lived in environment. There has to be a follow up investigation as to how the lived-in environment in these homes can be improved in order to protect the occupants as it is simply not right to leave them out in the cold.

There is a understandable reluctance amongst landlord owners to be spending money on their properties and we would certainly not like to see this legislative change result in landlords having to increase rents to maintain their return on investment.  Whilst the Warm Up Your Home Government subsidy is still available until June 2016 we note that $1.5m is being set aside to fund the “information campaign” and a further $4m being allocated to the MBIE budget to cover the “implementation costs”.  The total of $5.5m seems to us to be rather excessive and not necessarily required in total.  Based on the stated average of $3,300 as the cost of insulating these homes even half of that budget would go a long way to extending the Warm Up Your Home Subsidy?