Question submitted by APIA member Maggie: I have existing tenants, a couple with an adult daughter. The tenancy agreement is currently in the parents’ names. They would like to change it so the tenancy is in the daughter’s name and have requested a new tenancy agreement.
All three will continue to live there (as they always have), but the daughter is eligible for additional government financial support. They want the bond refunded to the parents and a new, higher bond lodged for the daughter.
I can’t do a final inspection for the parents as the house is still full of their belongings. The daughter is happy to take responsibility for any damages from the start of the parents’ tenancy.
Is it better to use a change of tenant form in this case?
Answer from Sara Mitchell, Operations Manager, Harcourts Reforma
In this instance, the best approach is to complete an assignment.
An assignment occurs when the current tenant(s) wish to transfer their tenancy to a new tenant, and the incoming tenant agrees to take on all existing terms and conditions of the tenancy.
Final Inspection — Even if the Property Remains Occupied
Even if the property remains occupied, you should carry out a final inspection for the outgoing tenants. This inspection can be done around the tenants’ belongings, but all defects, damages, and concerns should be documented thoroughly with both written notes and photographic evidence.
A final inspection is strongly recommended as it provides protection should disputes arise at the end of the tenancy.
Assignment Agreement
An assignment agreement should be completed. This document clearly states which tenants are leaving and which will remain. It is then attached to the original tenancy agreement — a new tenancy agreement is not required.
At Harcourts Reforma, we use internally developed assignment agreements that have been drafted and approved by our legal team.
Bond Handling
- The bond can be refunded to the outgoing tenants and a new bond lodged for the incoming tenant.
- A WINZ letter may be required.
- Standard bond refund and lodgement forms should be used.
- You can only take a maximum of 4 weeks’ rent for bond — this must be considered if accepting a higher bond amount.
- Rent can only be increased if there has been no rent increase in the past 12 months, in line with the Residential Tenancies Act.
Landlord Rights in an Assignment
- The landlord may require the new tenant (assignee) to be of similar quality to the outgoing tenant (assignor).
- The landlord may request the incoming tenant complete a full application and undergo standard vetting checks.
- Reasonable costs incurred in processing the assignment can be passed on to the outgoing tenant — such as credit checks, preparation of the agreement, and the final inspection.
Note for APIA Members: We welcome your tenancy questions — email us at admin@apia.org.nz and we may feature yours in a future Q&A.
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