Unit rents lead the way

Trade Me Property’s February rental data shows that, following an increase in January, the national median weekly rent has dropped $5 down to $430.

While the national median weekly rent was down on January, it was up 4.9% on February last year.

Head of Trade Me Property Nigel Jeffries said February saw rents settle after the annual new year market adjustment in January.

Depending on the region, the rental return news for landlords around the country was mixed.

However, the unit-apartment market provided a particular ray of light.

The national median weekly rent for units has increased by 12% over the past year, which mean it hit a record level of $360 a week in February.

When it came to apartments, the national median weekly rent went up by 7.5% over the past year. This left it at $430 a week in February.

Jeffries said that while Auckland was a key driver in these markets, it was interesting to see the rise in popularity of units outside the major metro areas.

“The Bay of Plenty has seen the median weekly rent for units rise 21% in the past year, and it now sits at $315 a week.

“In Northland, weekly rents for units are up 30% in the past year to $260 a week. In the Manawatu/Wanganui rents of units were up 22% to top $218 a week in February.”

Even in Auckland, where rents were static overall, landlords with apartments had a slightly better time in February, he said.

“Asking rents ticked up by $10 per week to hit a new record high of $460 per week in February, after 10 consecutive months where asking rents have been static at $450 per week.”

Outside the apartment market, Auckland landlords did not see an increase in rents in February.

The city’s median weekly rent remained unchanged at $500.

Jeffries said that was a 5.3% increase on February 2015, but it has barely changed in the last nine months.

“That stable environment is good news for tenants but a tough one for landlords with significant mortgages.”

In Christchurch, the median weekly rent came in at $420 a week, which means it has remained static for five consecutive months and is down almost 7% on a year ago.

Jeffries said rents in Christchurch settled down, from some extreme highs, as the rebuild got into full swing.

“We don’t expect to see much change in that market in the coming months either.”

Trade Me Property’s data showed that, in February, the Bay of Plenty was, once again, the rental growth hot spot.

Jeffries said the most dynamic property market in the country is the Bay of Plenty - and that applies to both the rental market and the for sale market.

“Median weekly rents in the Bay hit a new record high of $400 in February, representing a massive 17.6% increase since February 2015.”

Over the past two years, the Bay of Plenty has leapt from 10% below the national median weekly rent (excluding Auckland), and was now 5% ahead, he said.