Northern rents booming - but not for all

The latest Trade Me Property Rental Index shows that while the national median weekly rent stayed flat on $450 in May for the sixth month in a row, many regional markets are booming.

Across New Zealand’s 15 regions only Canterbury saw rents drop year-on-year, while Gisborne and the West Coast were unchanged.

But Trade Me Property Nigel head Jeffries said some North Island markets were particularly strong, with Northland and the Bay of Plenty returning double digit growth.

“The median weekly rent in Northland has dropped slightly since April, down $5 to $380. That said, the region is still up 18.8% on this time last year.

“The Bay of Plenty maintained its record high of $450 a week in May. That is a year-on-year increase of 12.5% and leaves it second equal with Wellington in the most expensive region stakes.”

In the South Island, Nelson/Tasman reached a record high in May as it hit $399 a week, which was growth of 7.1% increase over the past year.

However, the results from the country’s biggest cities were a mixed bag – with median weekly rents in Auckland and Wellington rising while Christchurch saw a decline in rents.

In Auckland, the median weekly rent hit $530 in May, although this showed year-on-year growth of just 1.9%.

In Wellington, the median weekly rent came in at $450 in May, which was a strong year-on-year increase of 9.8%.

Jefferies said that, in the Capital, the most significant jump was for medium-sized properties (three to four bedrooms), which are the city’s biggest market.

“At $525 per week, medium-sized houses have jumped 14.1% in the last year, adding a massive $3,380 to the annual cost to rent one of these properties.”

But in Christchurch the median weekly rent fell by $5 to $390 in May, which was a 2.5% decrease on this time last year.

Jefferies said rents in the Garden City have declined relentlessly since the height of the rebuild.

“They’ve fallen year-on-year for the last two years. This means that in Christchurch rents have risen just over 8% in the last five years, while nationwide the rise was 25%.”

Christchurch was a perfect example of supply and demand in the rental market, he said.

“Before the earthquake, Christchurch typically had 1450 rental property listings listed each month. After the earthquake, this fell to around 1000, and that depletion drove rents up hard.

“Since 2013, the number of rental properties has increased steadily and we’re back to the pre-earthquake number of listings, with rents starting to level out.”

He added that they think Christchurch rents will stay around their current rate for the foreseeable future.

Read more:

Reigning in Wellington landlords 

Renting more affordable – HAM