Media Release

23 November 2016

Auckland and Wellington rents rise in quiet market

Tenants in Auckland and Wellington are being asked to pay more despite New Zealand’s median weekly rent remaining unchanged at $440, according to the October edition of the Trade Me Property Rental Index.

Head of Trade Me Property Nigel Jeffries said the national median rent was up 4.8 per cent year-on-year. “The median weekly rent hasn’t budged from $440 for four consecutive months but for the first time since April, Auckland tenants are being asked to cough up more. In the Super City they are being asked to pay $510 a week, an increase of $10 on the $500 mark where rents have been stuck for six months.

“Auckland’s rents are up just 3 per cent on last year so landlords won’t be celebrating, but it’s significant to see rent expectations tick up for the first time in quite some time,” he said. “The average annual rent cost for a typical Auckland property is now $26,520 – still a lot less than the cost of most mortgages in the city.”

Mr Jeffries said that Wellington was “considerably hotter” than the slight temperature increase reported in Auckland. “Rents in the capital are up again after a slight fall last month. In October, the weekly median rent jumped back to $420, not a record high, but enough to deliver an annual increase of 7.7 per cent on this time last year.

He said the Wellington market had seen strong growth since July and showed no sign of slowing down as the market moves into summer and the competitive New Year renting period.

Ups and downs in the regions

Outside of Wellington and Auckland, Mr Jeffries said Southland, Marlborough and Bay of Plenty showed “remarkable jumps” in October, with double-digit growth on last year and record median weekly rents.

“Marlborough and Southland both hit record weekly rents of $350 and $250 respectively as the juggernaut of the rental market – Bay of Plenty – kept rolling on. Median weekly rents in the Bay are up more than 15 per cent on this time last year to $410, and just $10 less than Wellington. The growth in the Bay of Plenty has been phenomenal.”

In contrast, there were four regions with dips on last year. In the South Island, the West Coast was down 6 per cent to $235 a week, and Canterbury dropped 4.8 per cent to $400 a week. In the North Island, Taranaki was down 2.5 per cent to $350 a week, and Gisborne was down 1.8 per cent to $280 a week.

“Median weekly rents in Christchurch look to have found their post-rebuild sweet spot at $400 a week. Rents have steadfastly remained at this price for six months and are the same as they were three-and-a-half years ago.”

Wellington soaring while Christchurch eases off

Wellington saw major increases in the median weekly rent across all house sizes in October, with the medium-sized houses typically sought by families, jumping 10 per cent on last year or $2300 per annum.

Meanwhile, Christchurch tenants continue to experience a respite from rental increases with only the large house category (5+ bedrooms) increasing.

Table 1: Median weekly rent by property size & region: October 2016 vs October 2015

Urban living more affordable

Mr Jeffries said apartments, townhouses and units are more affordable options for tenants with all three property types seeing lower median rent rises than traditional family homes. “Auckland apartments, which have been very strong recently, only ticked up 2.2 per cent on last year with a $10 rise in median weekly rents.”

He said Wellington’s house market strength was also reflected in urban property, with the highest median weekly rent jumps of 5.6 per cent, while in Christchurch the urban property options were down 7.9 per cent.

Table 2: Median weekly rent by property type & region: October 2016 vs October 2015

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NOTES

About the Trade Me Property Rental Price Index: This report provides a comprehensive monthly insight into the rental market covering price trends by type and size of property across New Zealand. The index is produced from Trade Me Property data of properties that have been rented in the month by property managers and private landlords. On average over 11,000 properties are rented each month and the report provides a comprehensive insight into this part of the property market for tenants, landlords and investors. The index is calculated using the median rent in the month, this being an accurate statistical assessment of the current rent being charged by landlords and property managers.

More info: For information about the differences between the Trade Me Property data and bond data collected by Tenancy Services, please read this post by Dr Lucy Telfar-Barnard from the University of Otago: http://onetwothreehome.org.nz/2015/05/11/how-high-is-the-rent/

Regional data: If you are after information for a particular region, please email Logan Mudge via mediaenquiries@trademe.co.nz and we will see what we can unearth for you. We can also provide the graphs and tables.

CONTACT

Nigel Jeffries is available for interviews. To tee up a time that suits, please email Logan Mudge via mediaenquiries@trademe.co.nz or phone (027) 477 9486.

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