House prices may be declining but rents show no sign of heading in the same direction.
The latest bond data from Tenancy Services shows the national median residential rent was $550 a week in October, up $30, or 5.8%, compared to October last year.
While landlords may be celebrating, the annual figures need to be treated with some caution because rental growth may not be as robust as those numbers suggest.
The national median rent first hit $550 a week in January this year, rising from $540 the previous December and $520 in November last year.
It then stayed at either $540 or $550 a week for the rest of the year, apart from June when it briefly dipped down to $535 before bouncing back up to $540 in July and remaining there until September.
So the $30 a week increase in median rent was something that actually occurred over the third and fourth quarters of last year. Since then rents appear to have been fairly stable.
That trend is also reflected in the figures for Auckland, which is the country's largest rental market by far, accounting for 38% of all bonds received by Tenancy Services in October.
The median rent in Auckland was $595 in October, up $5 a week, or 1.0%, compared to October last year.
However that's still below the peak of $600 a week which prevailed from November last year to May this year.
Those figures suggest rental growth in Auckland is flat at best.
However the latest figures come at the end of what is usually a fairly quiet time for the rental market. The next few months will be critical for determining which way rents are headed. That's because the period from December to February is traditionally the busiest time of year for new rentals, with many people using the Christmas break to move house and many students looking for new accommodation at the start of the year.
The table below shows the annual change in median rents around the country by region for the year to October.
The comment stream on this article is now closed.
16 Comments
How interesting. Every time Labour took a step to make the lives of tenants slightly better, "property investors" were whining and complaining and saying that ultimately all these costs will be passed on to the tenants.
Turns out they were full of sh....
Welcome back... still grumpy. Where's the happy Jester ?
I wonder if all the people who move around the country are having trouble selling thus more rentals on the market? Luckily the reduced rents will help cover the increased interest.... ... wait a minute...
wait a minute... you forgot the tax advantages ....... wait a minute....
5.8 percent rise for those who can't read.
In Auckland I would say the positive is that rents were stable during a very unsettled time. There were dire predictions of vast outflow of kiwis due to pentup demand, not matched by inflows. And more dire predictions that the accidental landlords and the record new builds combined with having no international students were about to crash the rental market. Put simply - HYPE
I can’t recall anyone predicting that the rental market would crash.
However, some (like me) predicted rents in Auckland would be essentially flat, which has been proven correct.
I expect small gains in 2023. Large supply coming on line will balance out with increasing immigration (mainly lower skilled) in Auckland.
Large supply coming on line will balance out with increasing immigration (mainly lower skilled) in Auckland.
Bought a Saturday paper today, which I do on rare occasions, there were two Real Estate inserts and each one was thicker than the actual newspaper. There are a tonne of properties coming on the market, at least where I live anyway, but still many with hugely unrealistic price expectations. Somethings gonna give in 23".
Christmas Classics.
by HouseMouse | 11th Oct 22, 4:26pm
It’s getting very boring.
I long ago admitted I was wrong on interest rates.
And Btw there’s no chances fixed rates will get to 7% before Xmas. They almost certainly won’t get there next year either.
👍
Yeah HM stuffed up big time there, however even though I thought rates would rise I never thought they would rocket like they have when I fixed a TD for 1 year back in late Feb. The rate of the increase has pretty much caught everyone with their pants down.
Accomodation supplement will keep rental market base stable unless the government cuts it back in some areas as more supply now available. F
From what I have seen many tenants who in the past could not get a rental because of risk are being offered rentals due over supply forcing landlords having to accept higher risk now.
Winners at the moment are landlords who have good tenants longterm versus the greedy lets up the rent everytime they can type now having to sign up higher risk profile.
Wages up, up, up. Immigration up, up, up. Construction pipeline down, down, down.
The only thing that will keep rents down is an artifical rent freeze.
Its because of the rental freeze implemented by the Govt from March through September 2020. Combined with the new law that says rents can only be raised once per year, the ability to increase rents for existing tenancies is now locked to the October to March time period.
Auckland will be impacted by the high vacancy rates of inner city properties that would otherwise by occupied by international students and migrants. I expect Auckland rent rises will soon catch up to the rest of the country when the oversupply is absorbed next year by incoming migrants and students.
Everywhere else is now suffering from an undersupply of rental properties due to all the impediments being imposed on landlords, as well as the higher interest rates starting to have an impact on rents. Rents are going to increase over the next few months to March, and will show up in the Dec and March quarterly inflation rate.
Read the Runes . The stones are running short of blood.
There are only 3 properties available to rent in Blenheim at the moment. Three. For a town of 30,000 people. Two of those properties are 2 bedroom flats, which is probably why Marlborough shows up as rents having fallen - they havent fallen, rentals (especially larger family homes) have simply disappeared from the market.
I'd love to see the conditions of these auckland properties for $595
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.