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Wellington City Council is phasing in residential water meters across the city by 2028, with Tiaki Wai managing the rollout. Currently, most landlords cannot legally pass water costs on to tenants. Water is bundled into council rates for the vast majority of Wellington rentals, and only properties with an individual meter in place can charge tenants for usage. Once a meter is installed, landlords can recover water costs under the Residential Tenancies Act 1986, but only if the tenancy agreement explicitly provides for it. Annual water bills are projected to reach up to $6,831 per property within a decade.

Wellington City Council is rolling out individual water meters to all residential properties by 2028. The rollout is being managed by Tiaki Wai, the new entity taking over Wellington's water assets. Until now, water for most Wellington homes has been bundled into council rates meaning landlords absorb the full cost and tenants don't see a water bill. That's about to change.

Here's what you need to know before the rollout reaches your property.

How water billing works in Wellington right now

For most Wellington rental properties, water isn't individually metered. There are currently only around 628 water meters installed across the city's residential and community stock which is a tiny fraction of Wellington's total rental market.

That means most landlords are absorbing the cost of water through their rates. You cannot pass that cost on to your tenants. Under the Residential Tenancies Act 1986, you can only recover water charges from tenants if your property is individually metered.

This is one of the most common misunderstandings I hear from Wellington landlords, particularly those who are self-managing with an older template tenancy agreement. Some assume that including a water charge clause in the tenancy agreement settles the matter. It doesn't. Without a meter, that clause isn't enforceable.

If your property doesn't have a meter, the water cost is yours. Full stop.

What changes when a meter is installed

Once your property has an individual water meter, the rules shift. Under the Residential Tenancies Act, landlords with metered properties can recover water charges from tenants, but only if all the following conditions are met:

• The property is individually metered for water supply
• The tenancy agreement explicitly requires the tenant to pay water charges
• The property meets the water supply requirements set out in the Act (continuous supply throughout the day, and a flow rate of at least three litres per minute at each outlet)

If all three conditions are satisfied, you can pass actual water usage costs on to your tenant. You can't profit from it, you charge what Tiaki Wai bills you, proportionally, for the tenant's usage period.

The detail that catches self-managing landlords out is the tenancy agreement requirement. If you've got an existing periodic tenancy and a meter gets installed, you can't simply start billing for water. Your tenancy agreement needs to support it. In most cases, both parties need to agree in writing to vary the terms and that conversation is much easier to have before a meter arrives than after.

The numbers landlords need to factor in

The financial stakes here are significant. Tiaki Wai has warned that annual water bills could reach as high as $6,831 per property within a decade, as the costs of maintaining and upgrading Wellington's ageing water infrastructure get priced into usage-based billing.

That's a substantial cost to absorb if you can't pass it on and it’s a substantial cost to pass on if your tenants are in older, less water-efficient homes.

For properties in suburbs like Thorndon and Kelburn - where many of the rentals are older character villas and heritage townhouses - water efficiency is worth thinking about now. Dripping taps, ageing hot water cylinders, and older shower fittings can drive up usage in ways tenants have little control over. That creates friction, and friction leads to disputes.

In Central Wellington, where newer apartment stock tends to be more water-efficient, the numbers will look different. But across the board, landlords who haven't thought about water efficiency are going to want to get ahead of it.

Can you install a meter before 2028?

Yes. The 2028 rollout is the council's mass installation programme, but landlords can arrange to have a meter installed earlier if they choose. Some are considering this to gain the ability to pass water costs on to tenants before the rollout reaches their property.

This is a legitimate option under the current law…… But proceed carefully.

There are active proposals to require landlords to meet water efficiency standards before they can charge tenants for usage. The reasoning is sound: if a property has known leaks or inefficient fittings, it's not fair to bill tenants for consumption they can't control. Nothing has been legislated yet, but this is the clear direction of travel.

If you're thinking about early meter installation, the sensible approach is to address any known water efficiency issues first. I.E. fix the leaking tap, service the hot water cylinder, check the toilets aren't running constantly and make sure your tenancy agreement is in order before the meter goes in.

What Wellington landlords should be doing now

The rollout is still two or three years away for most properties, which gives you time to prepare, but not to ignore it. Here's what I'd suggest working through:

1. Review your tenancy agreement. Does it have a water charges clause? Does it reflect the current legal requirements under the Residential Tenancies Act 1986? If you've been self-managing with a template agreement from several years ago, this is worth checking now, not when a meter arrives.
2. Check for water efficiency issues. Walk the property. Dripping taps, running toilets, and slow-draining gutters are all worth addressing before metered billing changes the financial dynamic. Fixing these now is considerably cheaper than disputing water bills later.
3. Factor water costs into your financial planning. Water is currently embedded in your council rates. Once individual metering kicks in, the billing structure changes. Build this into your rental income projections, particularly if you're approaching a rent review.
4. Talk to your tenants early. If you have a fixed-term tenancy that extends beyond 2028 or a periodic tenancy with long-term occupants. Your tenants need to understand what's coming. Introducing water charges without warning is a reliable way to damage the relationship and invite a Tenancy Tribunal application.
5. Don't assume about what you can charge. The rules around water charging under the Residential Tenancies Act are specific, and the consequences of getting them wrong aren't trivial. If you're uncertain what applies to your property, get advice before acting.

The bigger picture for Wellington landlords

The water meter rollout is one of several changes reshaping the cost and complexity of owning a rental property in Wellington right now. Alongside the Healthy Homes Standards enforcement focus, the Residential Tenancies Amendment Act 2024 changes to fixed-term and periodic tenancies that took effect in January 2025, and Wellington City Council's proposed rate increases for short-term accommodation, the compliance environment for Wellington landlords is more demanding than it was even three years ago.

Self-managing landlords are increasingly finding that staying on top of these changes takes more time and expertise than they anticipated. Small errors, an unenforceable water clause, a tenancy agreement that doesn't support introducing new charges, or a missed notice requirement can be expensive to resolve once a dispute is underway.

This is exactly the kind of regulatory change I walk through with every owner who comes to us. Understanding what you can do, what you can't do, and what's coming next isn't optional…. it's the job.

Wellington's water meter rollout is coming regardless of whether you're ready for it. The landlords who navigate it well will be the ones who understand the rules in advance and who have tenancy agreements that work, properties that don't waste water, and tenants who aren't blindsided by a new cost appearing mid-tenancy.

If you'd rather hand this over to someone who handles it every day….. tenant selection, inspections, maintenance, compliance, and rent collection - we'd be happy to talk. Get in touch with Dave at Propertyscouts Capital City.

Frequently Asked Questions

Can I charge my tenants for water in Wellington right now?

You can only charge tenants for water if your property has an individual water meter installed. Since most Wellington properties don't have individual meters yet - water costs are bundled into council rates - most landlords cannot currently pass water costs on to tenants. This will change as Wellington's meter rollout progresses toward 2028.

What happens when Wellington's water meter rollout reaches my property?

Once a meter is installed on your property, you'll be billed for actual water usage by Tiaki Wai, Wellington's new water authority. You can then recover those costs from your tenants but only if your tenancy agreement explicitly requires it and the property meets the water supply requirements under the Residential Tenancies Act 1986.

Can I install a water meter before 2028 to start charging tenants for water?

Yes, you can arrange early installation. However, you'll still need a tenancy agreement that includes a water charges clause, and there are proposals being considered to require water efficiency standards before landlords can charge for usage. If you're considering early installation, address any known water efficiency issues first and review your tenancy agreement carefully.

What if my tenancy agreement already has a water clause but no meter?

Without a meter, that clause is unenforceable under the Residential Tenancies Act 1986. You can include a water clause in anticipation of metering, but you can only begin charging once a meter is actually installed and all conditions under the Act are met.

How much could water bills cost Wellington landlords once meters are in place?

Tiaki Wai has projected that annual water bills could reach up to $6,831 per property within a decade. The exact cost will depend on usage and the final pricing structure. Older properties with less water-efficient fittings are likely to incur higher bills, which is worth factoring into your financial planning now.

About Dave McCarry
Dave McCarry is the owner of Propertyscouts Capital City in Wellington and has worked in property, business, and customer service for many years. Since becoming a property investor in 2009, he has built a strong reputation for practical advice, strong tenant selection, and hands-on property management focused on protecting landlords' investments and maximising returns.