The costs of bringing his rental property up to standard for the Healthy Homes Bill could see young owner Ben Booth sell up.

For young landlord Ben Booth, the Healthy Homes bill could mean the end of his investment.

Property experts in Wellington speculated that moves by the Government and Wellington City Council to force improvements to the capital's rental homes could end up forcing a massive selloff by private landlords

For fledgling property investor Booth the flow-on effects of such moves indeed seem inevitable.

Booth purchased his first and only property, a $350,000 three-bedroom home in Prebbleton, near Christchurch, in 2016 after seven years of saving.

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JOHN KIRK-ANDERSON/HOMED After saving for seven years, buying his first home was a big win for Ben Booth.

At 25 without tertiary qualifications he worked hard for his money on a dairy farm in Maruia.

Booth rented out his Christchurch property but still has to top up the fortnightly payments.

JOHN KIRK-ANDERSON/HOMED "It's not a bad thing, what they're trying to achieve is good. But I think they just need to think about the reality of us people at the lower end of the spectrum," said Ben Booth of the Healthy Homes Bill.

The potential costs of bringing his home up to the standard of the Healthy Homes Bill could upset things in a big way.

"It's definitely a concern and it is something that I need to know think about," he said.

"It's not a bad thing, what they're trying to achieve is good. But I think they just need to think about the reality of us people at the lower end of the spectrum, in terms of the simple finances of it."

JOHN KIRK-ANDERSON/HOMED Ben Booth has big plans for his property but has only done minimal exterior work so far due to financial constraints.

"$350,000 was my absolute limit, I scraped the bank. When the funds had gone through I had $1 left in my account, it took literally everything."

"A lot of us have put everything just to scrape into this bare minimum. It just needs to be thought about how it's going to affect people in reality."

Booth's property is a 1950s weatherboard duplex.

JOHN KIRK-ANDERSON/HOMED Selling his home and buying somewhere newer and up to standard would be ideal, but Ben Booth speculates he is priced out of that market.

"It's not particularly cold or anything like that but it is old. So there's limited insulation, there's no underfloor insulation."

"The purpose of Healthy Homes Bill is great," he said, "there's no denying that. There's no reason you wouldn't want that kind of stuff in your home. The only reason you wouldn't do it is for a financial reason."

"If I can't afford it, it may well be time to cash out, so to speak, and purchase a newer place," he said. "Problem being, they're a lot more expensive."

SUPPLIED "There will be a flow on effect with rental. Because if you're having to write a cheque out of your back pocket, people are going to have to get some form of return out of it," said Andrew Bruce, president of the Auckland Property Investor's Association.

President of the Auckland Property Investor's Association, Andrew Bruce estimated that self-managing landlords of properties in need of maintenance, such as Booth, would be the hardest hit by proposed changes.

"My understanding is that around 55 per cent of properties are managed by property managers and around 45 per cent are privately managed," Bruce said.

"I've got friends who've been four or five years in the same place and the rent has never gone up," said Bruce. "So if you ring up the landlord and say, 'Could you please do a whole bundle of work?' What do you think the landlord is likely to do?"

JOHN KIRK-ANDERSON/HOMED "When I was buying, it simply wasn't realistic for someone in my position to go and purchase a new place, a place that was more up to standard. It's very nice having these standards but if it's not affordable, it doesn't help," said Ben Booth.

"It's quite likely to be a catalyst for a lot of those properties that have actually been a wee bit below market rental, or in some instances substantially below market rental. I think quite a few people might be in for a substantial shock in terms of the rents going up, to even a market rental [rate]."

"No one wants to be seen to be living in damp, wet, horrendous conditions. No one wants to be in that position," said Bruce.

"I'd like to think that people wouldn't want to be providing those sorts of conditions, but I guess they do. I suppose it looks like a little bit of legislating for the lowest common denominator."

Are you a landlord or tenant worried about possible changes? Email us at homed@fairfaxmedia.co.nz.

Young landlord Booth would prefer not to raise the rent if he can avoid it.

"I don't think it's fair to pass on my problems to my renters just because I can't afford it," he said.

He estimated he could potentially spent $10,000 to 15,000 with cooperation from his bank, but more than that and he'd be forced to sell.

"I'd be in a fair bit of trouble," he said. "It's not realistic at all for someone in my position."

Christchurch Investor's Association president Stephen East, agreed that landlords without a buffer of cash would be the hardest hit.

"It's not so much about amateur or professional investors, it's about the stage they're at in their investment journey and whether they have the reserves to shoulder the costs."

"It's likely to hit new investors harder, because they won't have the cashflow available to front up thousands of dollars for additional compliance and regulation."

That is unfortunately just the case for Booth.

"For a person like me, there's not really anything at the end of the pay cycle to put aside for things like that [the bill]."

Though his property is a "do-er upper" the only work on it he's been able to afford so far is rubbish removal and the construction of a fence in collaboration with the neighbouring owner.

"If I had $10,000 right now, the first thing I would spend it on is underfloor insulation, so I can peel up all these old carpets and polish up the nice rimu floors under there. It would make a huge difference. From there I'd probably head to the bathroom, head to the kitchen."

"If and when it does come in, [the bill] will mean that any money that was in the budget for personal renovations will need to be diverted to fulfil whatever they're asking."

Timing of the bill and ambiguity of standards remain up in the air.

"The bill will affect all property investors," said East. "We don't know what the full effect will be since the bill will pass into law standards that have yet to be developed by MBIE. That's the equivalent of writing a blank cheque. And as far as I'm aware, landlords won't get to have a say about those standards, which is an enormous concern."

"We support warm and healthy homes for tenants, but landlords can't sustain their business long term if they're making a loss. Ultimately, it's going to scare investors out of the market, and it's another nail in the coffin of being a landlord."​

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