Sept 3 - Should Councils Be Property Managers?

Submitted by VinceAdmin on Wed, 02/09/2015 - 7:54pm

We seem to take it for granted that councils have the ability and the right to manage rental properties. Perhaps we shouldn’t.

At the beginning of July the government imposed new quality standards on landlords.  All rental properties must be insulated by 2019, all must have smoke alarms by next year, and new powers have been set up to prosecute landlords who break tenancy regulations. But what will happen when councils break these rules? Who ends up footing the bill?

The Northern Advocate reported in March that a council-owned Ewing Road property worth $400,000 sat empty for two years with squatters coming and going. Then, just over a month ago, a suspicious fire gutted the place – damage which could have been avoided if the property was used properly. Purchased in 2005, this building was supposedly set aside for marina parking.

There’s the old Harbour Board Building within the Town Basin, an iconic building with a huge amount of potential. This was a Northland Regional Council (NRC) building before being bought by WDC, but the two councils, in their wisdom, have left it empty for almost ten years now. Sure a lot of people are excited that the building may host a Hundertwasser centre, but couldn’t the building have been used to add value to our city for the past decade and not left sit and rust?

The old Countdown building site in Kensington, owned by the NRC for many years, has had several developers offer money to develop the site. However the NRC wanted more money than the land was worth, so it has been left to sit and be a target for graffiti.

Perhaps building owners shouldn’t carry out property management duties.  The owner wants the most money it can get for the property, and the manager wants the building to be tenanted all the time, and sets the value that the building should be at, so it always has tenants and then makes sure that the owner does the maintenance on the building to keep it up to standard.

Looking at their track record, our councils are not the best landlords.  When questioning MPs about council ownership of properties the answer comes back: it is not their core business, so they should not be doing it. 

So, dear reader, what do you think? Should we take the keys off the councils?

 

Comments

WD

Fri, 04/09/2015 - 10:45pm

Vince, what is missing here is any sense of vision outside of self interest.
It's like Councils buy property just "because they can" not because they have any clear vision of how it can be used.
So:
1. Councils are as good a property managers as anyone else
2. They have too much money (albeit borrowed) to indulge their fantasies without having a clear plan and vision as to where such properties fit in
3. You missed out one of the biggest farces of the lot - the Blue Goose. Remember Craig Brown at the time singing its praises - they bought it just because they could - flowery ideas, little substance, much ratepayer money and it still sits largely idle.
4. So just to summarise: this has nothing to do with council as managers but everything to do with council as visionaries and strategists.

Vince

Sun, 06/09/2015 - 7:58pm

Thanks for the comments,

Would you say the problem sits with having the right Councillors, those who are prepared to provide good direction? or would you say the problem sits with the Senior management, those who manage the Districts day to day money?

I do hear the statements that Councillors give when they say "it's all part of the bigger picture", or "it's not our job to tell the staff what to do, they bring the best projects to us to sign off", or any other form of excuse...

Vince