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$2m of tenancy bonds left unclaimed each year


interest-ratesIf you have moved out of a rental property recently, did you reclaim your bond?

The Ministry of Business, Innovation and Employment (MBIE) has revealed about $2 million is left in unclaimed bonds each year.

A bond is paid at the start of a tenancy and refunded to the tenant at the end if there has been no damage to the property.

An MBIE spokeswoman said about $220m worth of bonds was refunded each year.

"So the percentage not claimed or collected is small in percentage terms. We have processes in place to attempt to contact these people on a regular basis to attempt to arrange the refund. After six years the legislation prescribes that any outstanding money is transferred to the Crown."

That means the pool of lost bonds hovers at around $12m before it is passed over to the Treasury.

But Helen Gatyoni, of the Tenants Protection Association, said it was too much lost money.

She said the money was earning interest for the Government and that income should be channelled into services that would support better tenant education.

"That would result in the figure not being as high in terms of non-recovery."

She said it should not be hard to track down tenants who were beneficiaries, to refund their money.

"It's not as simple as people forgetting. Sometimes it gets a bit complicated for people to recover the bond, or an overseas person might go home without claiming the bond. Or the tenant might believe there is no bond to recover, because that's what they have been told. Is there enough being done in terms of following it up?"

But NZ Property Investors Federation executive officer Andrew King said sometimes the money was due to landlords, too.

If there is disagreement about how the bond should be distributed between the landlord and tenant, Tenancy Services will not refund the bond until an agreement is reached or the Tenancy Tribunal issues an order advising how it should be refunded.

Many did not want to go through that process, King said. "Some landlords don't go to the tribunal because they think 'what's the point'. But without the order you can't get the money back."

He said in other cases young tenants in shared flats were confused about whose money the bond was or did not get all the signatures to claim it.

 

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