With housing back in the pre-election spotlight, the Green Party this week launched their policy package, targeted at an often overlooked segment of the voter spectrum – renters.

The problem, as the party sees it, is that a significant proportion of rental stock is in poor condition, and security of tenure for renters is weak, giving landlords disproportionate power in the contractual arrangement.

The policy aims to tackle this by implementing a warrant of fitness (wof) and star rating system for rental properties. The party also wants to boost security of tenure by giving tenants the right to renew their leases and government the ability to determine rent increases according to an as-yet-unspecified formula.

The idea is certainly savvy politics, with a growing number of renters in the country due to the housing affordability crisis and the Christchurch earthquakes, but does it make for good public policy?

The negative effect that rent controls have on rental supply is well-documented, so the focus of this article is on the property wof.

Based on a pilot study conducted by the University of Otago, the compulsory scheme stipulates that should a rental property not meet certain conditions, tenants can withhold rent until such time that it does.

But what happens when a disaster damages a large proportion of the rental stock? Does that mean tenants would be able to withhold rent while the bureaucratic processes slowly work through the insurance claims, as happened in Christchurch?

Furthermore, what about price sensitive tenants who are willing to sacrifice quality for a cheaper property, such as students?

Indeed, the proposal only focuses on one part of the tenant-landlord relationship. If we’re going to warrant properties, why not warrant tenants, based on whether they damaged previous accommodation and paid their rent on time?

The Greens have also shown Beltway thinking with this proposal, in that central government will pass legislation but leaves it to local government to implement and enforce. Other pieces of legislation that have followed this model, such as the Resource Management Act and Building Act, have demonstrably increased the cost of housing, not reduced it.

Lastly, there are numerous quality ratings in the private sector. If this is such a good idea, why does the government have to get involved at all? A far better option is to cut red tape and free up supply. That way investors could respond to high rent prices by building more homes, thereby curtailing landlords’ ability to extract excessive rents on poor properties, and giving renters the choice to vote with their feet.