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Trade Me - Rents Unchanged for Last Six Months

Rents unchanged for six months straight

New Zealand’s median weekly rent has not moved in the last six months according to the latest Trade Me Property Rental Index.

Head of Trade Me Property Nigel Jeffries said the typical New Zealand rental property started the year with a median weekly rent of $450 and is yet to budge. “I’m sure these numbers will be a relief for the many tenants who have felt big rises in recent years. They’ll be pleased to see the brakes have stayed on but not everyone will be happy as a number of regions are still seeing strong rent inflation.”

Mr Jeffries said that while there was little movement this year, the median weekly rent was still up 4.3 per cent on June 2016 when the nationwide median weekly rent was $430. “Landlords are still seeing some gain on their investments - they’re earning over $1000 more on the typical property than they were a year ago.”

Auckland and Christchurch lagging

Mr Jeffries said year-on-year growth in asking rents in Auckland and Christchurch lagged the national increase. “Auckland’s median weekly rent of $530 remains the highest in the country, but growth in our largest city is down on the national average, up only 3.9 per cent on this time last year.

“Median weekly rents in Christchurch haven’t grown year-on-year for the last 12 months as the city settles back into its rental rhythm. The median weekly rent in the Garden City ticked down 2.5 per cent in June to $390. The asking rent in the city has only gone up $30 in the past five years.”

Mixed bag in the regions

Median weekly rents outside Auckland, Wellington and Christchurch were up 8.6 per cent year-on-year with the ‘star performing’ regions still showing growth. These regions include Northland (up 15.2 per cent), Waikato (8.3 per cent) and Nelson (8.1 per cent).

However Mr Jeffries said it was a mixed bag throughout the country in June. “While some regions continue to grow solidly, the double-digit jumps we’ve been seeing have reduced significantly.

“For example, in the Bay of Plenty the median weekly rent leapt from around $350 in June 2015, blasted up to $400 a week in June 2016 and peaked at $450 in April this year. But since then, it has plateaued and now sits at $430 a week, up just 2.4 per cent on a year ago. Tenants in the Bay will be pleased to hear the massive growth of recent years appears to be slowing for now.”

Northland was the strongest performing region with the median weekly rent jumping to a near-record $380 in June, and meaning tenants can expect to pay an additional $2500 a year to rent the typical property.

Nelson was the only region to hit a new record in June, hitting $400 a week and meaning tenants will be set to pay an extra $1500 more in rent per annum.

Meanwhile Taranaki, the West Coast and Marlborough were all unchanged year-on-year, and Canterbury was the only region to fall, dipping 1.3 per cent.

Large houses hit new peak

Large houses (5+ bedroom homes) hit a new record median weekly rent of $775 in June. The annual cost of renting these properties is now over $40,000 and costs $3900 more than this time last year.

Mr Jeffries said large houses in Auckland didn’t hit a new high in June, but continue to be extremely popular with tenants. “There’s a lot of demand for large homes in the City of Sails and the median weekly rent is up 13.3 per cent to $850. That’s an annual cost of over $44,000 and up $5,200 on last year.

“Wellington isn’t far behind, large houses have a median weekly rent of $800 in the Capital, up a staggering 23.1 per cent compared to June last year. That’s a $7,800 rise for tenants in a year.”

Wellington continues to feel the heat of supply v demand

Mr Jeffries said Wellington’s urban properties are still seeing a huge imbalance between demand and supply, with the lack of properties pushing median weekly rents up in all urban property categories.

“Apartments, townhouses and units have all jumped more than 11 per cent in the last year. Tenants looking for these properties are having to find a lot more money. In the case of units they’re paying over $1800 more a year and over $2300 more for apartments and townhouses.


ENDS


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