Wear and Tear vs. Damage in NZ Rentals: What Landlords Need to Know

Understanding the difference between fair wear and tear and tenant caused damage is essential for landlords across New Zealand. It affects everything from bond claims to insurance liability, and is a common issue brought before the Tenancy Tribunal.

What Is Fair Wear and Tear?

Fair wear and tear refers to the natural deterioration of a rental property due to normal use. According to Tenancy Services NZ, tenants are not liable for this type of wear and tear.

Examples include:

  • Flattened carpet in high traffic areas
  • Minor wall scuffs
  • Faded paint or worn tapware

These are expected outcomes and cannot be deducted from the tenant’s bond.

What Is Tenant Caused Damage?

Damage is caused by carelessness, neglect, or intentional actions. Under the Residential Tenancies Act 1986, tenants may be held responsible for damage that is not consistent with the normal use of the premises.

Examples include:

  • Carpet burns or stains
  • Holes in walls
  • Broken appliances or fixtures

If the damage is careless, the tenant’s liability is capped at four weeks’ rent or the landlord’s insurance excess, whichever is lower.

How the Tenancy Tribunal Decides

The Tenancy Tribunal considers:

  • Location of damage (e.g. high traffic areas)
  • Length of tenancy
  • Age and condition of items
  • Avoidability of damage
  • Depreciation (e.g. a 10 year old dishwasher may be fully depreciated)

The $2 coin rule can be used: if a mark is smaller than a $2 coin, it’s likely wear and tear. Larger or multiple marks may be considered damage.

Why Occupant Numbers Matter

More occupants = more wear. A two bedroom home with one tenant will show less wear than the same home with a family of five. This doesn’t mean there’s damage, just that wear and tear may occur faster.

Depreciation and Bond Claims

Even if something is damaged, its book value matters. If an item is nearing the end of its life (e.g. a 9 year old carpet), it may not be worth pursuing a bond claim. The Tribunal considers depreciation when assessing compensation.

Landlord Tips for Managing Wear and Tear

  • Use detailed entry and exit condition reports
  • Take dated photos at the start and end of tenancy
  • Understand insurance excess limits
  • Communicate clearly with tenants
  • Seek advice before lodging a Tenancy Tribunal claim

Need Help Navigating Tenant Damage?

At First National Progressive, we help landlords protect their investments while maintaining fairness for tenants. Whether it’s mystery carpet stains or faded curtains, we’ve seen it all, and we’re here to guide you through it.

Wear and Tear vs. Damage in NZ Rentals: What Landlords Need to Know

Disclaimer

The information provided in this blog is intended as general guidance only and does not constitute legal or technical advice. While we strive to ensure accuracy, laws and regulations may change, and individual circumstances vary. We strongly recommend that landlords seek independent legal and/or technical advice before making decisions related to tenancy matters, property maintenance, or disputes.