NZ weekly rents rise 6% in year to October, Trade Me says

Tuesday 11th November 2014

The median weekly cost of renting a house in New Zealand has risen more than six percent on a year ago, underpinned by a heated rental market in Christchurch, according to the Trade Me Property Rental price index out today.

Rents are rising faster than property asking prices, which indicates things are tightening up for tenants, said Trade Me Property head Nigel Jeffries. The new index measures rental trends for more than 10,000 properties listings through Trade Me Property by private landlords and property managers in October. Jeffries said the rate of increase in rents nationwide had been steep over the past three months.

The biggest rise has been in what Jeffries called the “scorching” rental market in Christchurch where median weekly rents have jumped 20 percent year on year to a new record high of $510 per week, compared to $425 a year ago. The highest rents nationwide are a median $805 per week for five bedroom plus houses in Christchurch.

“With 12,000 houses removed from the city and an influx of workers moving in for the rebuild, the rental market remains under pressure in Christchurch,” he said.

The increase in median weekly rents was also strong in Wellington, up 9.5 percent on a year ago. Jeffries said the rise was across the board in the capital with the largest homes now attracting $700 a week, up 27 percent on a year ago.

Auckland remained reasonably stable with a 2 percent year on year increase in median weekly rent to $460 per week although the market is dominated by three and four bedroom houses which saw a 5 percent rise.

On a regional basis, Taranaki lead the pack with a 23 percent median weekly increase compared to a year ago to a record high of $370 per week. Jeffries said the region was experiencing a mini boom off the back of the energy sector in New Plymouth with strong increases in property asking prices as well.

Canterbury median rents rose 22 percent while Manawatu/Wanganui defied the national upward trend with a 11 percent fall in median weekly rents, a decline that started earlier this year.

Inflationary pressures are strongest for medium sized properties, with rents up close to 10 percent year on year. Units are the cheapest to rent with a national median cost of $300 per week which was unchanged, although units cost the most for Christchurch tenants at a median $340 per week.

Looking back at the past five years, Jeffries said the most significant rises had occurred in the past two years. Tenants paying a median weekly rent of $360 a week in 2012 were now having to dig out another $40 a week, he said.

BusinessDesk.co.nz

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