Source: New Zealand Government
Restoring the brightline test to two years will help increase the supply of residential property putting downward pressure on rent, Revenue Minister Simon Watts says.
“From 1 July, the brightline test will replace the five and ten-year periods with a more balanced two-year period.
“Every day, New Zealanders are struggling with higher costs of rent, and this Government is making common-sense decisions to make life easier by rebuilding the economy and easing the cost of living. By restoring the brightline test to two years, we are doing exactly that.
“A big problem that is causing rents to skyrocket is the lack of availability of residential properties for renters to choose from.
“By making investment in residential property more attractive, we will see a greater supply of properties in the market which will support rent becoming more affordable.
“Tying homeowners down in compliance only applies pressure on the rental market. That’s why we have also simplified the application of the main home exclusion from the bright-line test by introducing a clean test for what is exempt.
“Homeowners will no longer be subject to the two-year bright-line test if they occupy the home as their main residence for 50 percent of this time. This will make it easier for homeowners to get their property onto the market and sold.
“This will mean more residential properties for renters to choose from, taking some of the upward pressure off rents.
“This delivers on one of the key decision-making principles as part of the coalition agreements between National, Act, and New Zealand First.”
