Rents shoot up due to limited stock

The national median rent increased by 3.4% year-on-year to hit a record $460 per week in November, according to the latest Trade Me Property Rental Index.

Head of Trade Me Property Nigel Jeffries says it was the first increase since last December and was driven by a lack of available rental stock. 

“Supply simply cannot keep up with the demand we are seeing and it’s rare for rental properties to be coming on and off the market so quickly.

“We’re seeing rentals are being listed for a very short time as fierce demand means landlords can have their houses listed and then tenanted in record time.”

He says they did see rent rises around this time last year, but the rental market is much tighter this year.

The rent increases are widespread, with all but one of New Zealand’s 15 regions seeing year-on-year rent increases.

Six regions recorded double-digit growth, with Marlborough leading the pack with a 23.5% jump to $420 per week.

It was followed by the West Coast which saw an increase of 22% to $288 per week, Whanganui which rose 12% to $320 per week, and Hawke’s Bay which was up 11.8% to $380 per week.

However, Jeffries says it is the Wellington rental market which is under the most pressure heading into the New Year.

The region’s median weekly rent was up 8.7% on November 2016 to $470 per week while the number of available rental properties was down by 71% at the end of November.

“We are seeing a growing number of enquiries on Wellington rental listings within just hours of appearing onsite as Wellingtonians battle to secure a flat,” he says.

“In November, a two bedroom property in Mt Cook received 33 enquiries in the first three hours of being listed.”

The situation in the other two main centres was different.

In Auckland the median weekly rent was up by 1.9% year-on-year to $530 per week, meaning rents remain comparatively flat.

But Jeffries says available rental stock in the Super City is down 35% on last year and with students set to flood the rental market early next year some large rental increases could be in store

Conversely, Christchurch continues to buck the national trend. It saw a 1.3% year-on-year decline in median rents which left them at $390 per week.

Jeffries says that, thanks to the rebuild, Christchurch is one of very few places in the country where the supply of rental properties is in good shape.

Read more:

Super City rents up, supply down 

Rental prices could spike