Rental market stalls nationwide

The Trade Me Property Rental Price Index shows that New Zealand’s median weekly rent has stayed at $420 per week for the fifth month in a row.

Even in Auckland’s superhot market the median weekly rent has stuck at $495 per week for the second month in a row.

Once Auckland is excluded from the data, the median weekly rent remains unchanged from June at $360 per week, which was a drop on the $380 per week record in March.

Trade Me Property head Nigel Jeffries, said the national median weekly rent demand has gone up by 6% over the last year, but most of that increase came in late 2014 – early 2015.

Likewise in Auckland, where the median weekly rent has gone up by almost 8% over the last year, most of the increase came early this year.

“We’re seeing the rental market slowing down across the country and demand pressure in the City of Sails is easing.

“Since early 2015 Auckland’s weekly rent has only seen small incremental increases – a clear indication of lessening demand pressures and a healthier supply of rental properties.”

However, over the last five years, Auckland rents increased by 27%, going from $395 per week to $495 per week last month.

Jefferies said this rental increase is minimal compared to the additional $280,000 which has been added to the average asking price of an Auckland property over the same time period.

Meanwhile, regional rental data provided a mixed set of results.

Seven regions – including Manawatu/Wanganui, Otago, Waikato and Bay of Plenty - had increases of 5% of higher, two regions had an annual fall and three regions showed no change.

Jeffries said it was possible the “Auckland effect” could be behind the median rent increases in the Waikato and Bay of Plenty where they rose by 5.9% and 6.3% respectively.

“There’s speculation that Aucklanders are investing in regions like the Waikato and Bay of Plenty which may explain why median weekly rents in these regions continue to increase.”

The Canterbury region declined with July’s median weekly rents of $425 per week the same as a year ago, after peaking at $485 per week in March.

This is very different from a year ago when annual increases in rents were recorded in double digits, Jefferies said.

“It is another clear indication that the rebuild peak has been crested and the Christchurch rental market is slowly settling into its new reality."