Rents rocket in the regions

May was another strong month for the New Zealand rental market with every region experiencing an annual increase and five provinces reaching new records, according to the latest Trade Me Rental Price Index.

Trade Me’s Head of Property Nigel Jeffries said rents outside New Zealand’s three largest cities saw significant growth in May and eight regions experienced strong double-digit increases. “It’s very uncommon for us to see year-on-year rental price growth in every region, particularly at this time of year when we would expect the rental market to cool.

“Southland, Taranaki, Northland, Otago and the West Coast in particular had very strong months with all five hitting new record median weekly rents in May.”

“Supply is simply not keeping up with demand around the country which means landlords can continue to demand top dollar for their rentals. Also, with the new insulation rules for rental homes coming into effect on July 1, we think landlords may be passing this cost onto tenants.”

Mr Jeffries said rental properties nationwide had seen a surge of interest and the country’s median weekly rent rose 5.3 per cent year-on-year to $500. “The average number of enquiries jumped up 22 per cent on last year as more tenants looked to make a move in May. Stock is battling to keep up with this growing demand and we saw a 6.7 per cent decrease in rental properties coming on to the market in May.”

“While rents rocketed in the provinces, the main centres were steady. The median weekly rent in Auckland has remained at $560 per week for most of the year and rents in Canterbury appear to be experiencing a similar trend, hovering around the $400 mark since September last year. After a red hot summer rents in Wellington have cooled, falling $25 on January’s high to $525 per week in May,” he said.

Waikato has New Zealand’s most popular rental, again
Mr Jeffries said for the second month in a row Hamilton has held the title of the most popular rental in the country. “A two-bedroom apartment in Claudelands had 94 enquiries in just two days onsite making it the most enquired rental property on Trade Me in May. Hamilton also took out the second spot with the second most viewed rental in the same suburb of Claudelands.” Mr Jeffries said.

The median rent in Hamilton rose 10 per cent on May to $440 per week, $10 shy of April’s record. “There’s a growing interest for rentals in Hamilton with 15 per cent more enquiries than May last year. Stock on the other hand isn’t keeping up and the number of rental listings in the city dipped in May, falling 3 per cent on last year.”

Waikato’s most popular rental listings in May 2019

Mr Jeffries said rents in the wider Waikato region continued their upward trend, rising 7.5 per cent on last May to $430 per week.

“If we take a closer look at the region, the largest increases have been in the Taupo and Matamata-Piako districts. The median weekly rent in Taupo reached $420 per week in May, up 20 per cent on last year when it was just $350. In the Matamata-Piako district the median rent hit a record high of $430 per week, up 13 per cent on the year prior.”

Mr Jeffries said more and more Kiwis were looking at renting in Waikato and in May there were 17 per cent more enquiries than the year prior.

Auckland rents remain steady
Mr Jeffries said the median rent in Auckland remained unchanged for a fourth consecutive month to stay at $560 per week, up 1.8 per cent on last year.

“Rents in Auckland have been relatively flat for more than a year, having only increased $10 per week since February 2018.”

Mr Jeffries said there’s still plenty of interest in the Auckland region but it appears that the number of rentals in the region is meeting demand.

“Rentals outside Auckland’s city centre are most popular with tenants, the most enquired about property in the region in May was in Bucklands Beach - 22kms from the city.”

Auckland’s most popular rental listings in May 2019

Wellington rents cool
“The median weekly rent in Wellington rose 9.4 per cent year-on-year to $525 in May, but prices are well down on January’s record of $550. Tenants in the capital are a bit better off but we expect to see prices in the capital continue upwards later this year, there simply aren’t enough rental properties in Wellington compared to the demand.

“Taking a closer look at the region, Upper Hutt saw the largest annual increase of 31 per cent or $125 to a record $520 per week. South Wairarapa rose 21 per cent to $450, Masteron was up 20 per cent to $395 while Wellington city rose 9.6 per cent to $570 per week.

“Wellington’s most popular rental in May was in Naenae, fetching 80 enquiries in the first two days onsite.”

Wellington’s most popular rental listings in May 2019

All houses sizes increase
“The median weekly rent increased for all house sizes in May with large houses (5+ bedrooms) outside Auckland and small houses (1-2 bedrooms) in Wellington experiencing the most growth of 15 per cent year-on-year.”
Mr Jeffries said outside Auckland the median weekly rent for houses reached a new record of $445 per week.

Apartments, townhouses and units rise

“Apartments, townhouses and units all saw increases in the median weekly rent in May.
Mr Jeffries said townhouses in Auckland were the only urban property type to fall across the country, dropping a modest 1.5 per cent year-on-year.

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