That is of cold comfort to landlords struggling with increasing tax and other costs.
Rents rose by 0.9% in the December quarter and are up 4.4% over the past year. Rent is the biggest single item in the Consumers Price Index, accounting for just under 10% of the basket. The CPI rose 1.4% in the December quarter to 7.2% over the past year, slightly down on the previous quarter.
Economists are predicting the Reserve Bank might not need to hike the OCR by 75 basis points next month to bring inflation under control and could look at a 25 or 50 basis point rise instead.
Apart from rent being a major contributor to inflation, housing costs are adding to the pressure, says Westpac senior economist Satish Ranchhod. The December had 2.1% increase in the cost of buying a newly built home., with cost up 14% over the past year.
“Although the material shortages that dogged the construction sector over the past year have eased, there is still [resure on build costs. That includes higher labour costs and contractor charges.”
Trade Me Property‘s rental index shows the national median rent across the country stayed at $580 in December and had been the same since September. That was $10 more than January last year.
Trade Me property sales director Gavin Lloyd says the $20 price increase in the national median rent between December 2021 and the end of last year was only half the size of the rise the year before when the median rent rose from $520 in December 2020 to $560 in December 2021.
Last year rents were up annually in every region of the country apart from Wellington, with Northland showing the biggest increase of 12% to $560 in December. That was $60 more than in January.
Wellington still has the most expensive median weekly rent at %560. It was up 3.2% annually, but unchanged from the beginning of the year in dollar terms.
In the Auckland region the median weekly rent grew by 3% annually to reach a new high of $615 in December. This comes after rents remained stagnant for more than 12 months, fluctuating between $600 and $610 since October 2021.
Rents were up 11% to $555 In Nelson-Tasman, followed by Marlborough with a 9.2% annual increase to $535. That was $5 and $35 more than in January respectively.
In dollar terms, Manawatū/Whanganui and Taranaki also had large rent increases since January, up $45 and $40 to $515 and $550 a week. They rose by 7.3% and 5.8% annually.
Rental supply was up nationwide for the ninth month in a row, with a 2% annual increase in the number of rental properties listed on Trade Me in December.
The biggest supply increases were in Manawatū/Whanganui, Wellington, and Northland, with rental listings for these regions up by 35%, 33%, and 22% annually.
At the same time, demand was down nationwide by 2% in December, says Lloyd.