The residential rental market appears to be holding steady, with the number of properties rented in April following its usual seasonal course while rents held on to the gains made at the start of the year.
The latest rental data from Tenancy Services shows it received 11,157 tenancy bonds in April, down slightly from the 11,802 it received in April last year.
Bonds are usually lodged at the start of a tenancy and their numbers tend to peak over summer and then decline over the winter months.
April's figures suggest the rental market is continuing to follow that trend this year and the bond graph below shows the monthly trend since the beginning of 2021.
Rents also appear to be stabilising after a period of growth, with the national average rent climbing back to its record $575 a week in April.
That's up by $25 a week (+4.5%) compared to April last year, with the average rent first hitting $575 in January and then dropping back to $560 in February and March before climbing back up to $575 in April - the rent graph below shows the trend since January 2021.
The rent figures derived from recently lodged bonds will reflect the rents being charged for new tenancies, which will tend to set the benchmark for other landlords when they review the rents of their existing tenants.
It's not uncommon for rent figures to bounce around a bit from month to month but the trends shown in the graphs below suggest a measure of normality has returned to the rental market after the disruptions caused by the pandemic lockdowns, albeit with slightly higher rents.
If the market continues to follow the usual seasonal trends then it would be likely that the average rent would soften slightly around the middle of the year and possibly pick up a bit in spring along with rental activity, depending on the balance of the underlying fundamentals of supply and demand.
A more detailed quarterly analysis of rental activity is available in interest.co.nz's Residential Rent Report.
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28 Comments
Perhaps the Aussies have a good idea? AirBnB has squashed our local residential rental market. Make it less attract than longer term rental (as it was before their arrival) and let's return stock to the market.
The Hobart City Council is doubling rates for owners of short-stay accommodation such as Airbnb in a bid to “open up” the city’s housing market....the ATO has many data matching processes and receives income information streamed directly from many holiday providers like Airbnb. if you do not report your income and you are identified via data matching processes, you could be fined and penalised for failing to report this income to the ATO.
Coming to a backyard container conversion near you!
In all seriousness, this would be a significant change. Seeing a lot of comments about the "poor renters" as landlords "have" to air bnb their properties instead of providing rental acc.
Many people don't have a choice, Labour made it illegal to rent out sleep outs, granny flats, converted garages, self contained flats within a home, and all other types of accommodation that dont meet the legal definition of a "seperate dwelling".
K.W. Rubbish. It is legal to rent out sleep outs, granny flats, converted garages, self contained flats within a home, provided they meet minimum standards eg are safe and warm. It’s only substandard places like unsafe uninsulated garage conversions without proper facilities that are illegal. Like the ones slumlords are renting in Queenstown to unfortunate people desperate for accommodation. Are you saying people should be able to rent out unsafe, unhealthy places?
or you can make residential rentals more attractive than what it is now?
In what way were you thinking?
Like having employees, there's now an almost maternal requirement to being a landlord. So you have this screwed up relationship which has a commercial underpinning, overlaid with a level of responsibility and liability that doesn't stack up.
AirBNB is not exactly a new revelation. booking, book a bach, holiday homes among others all operated short term accomadation platforms before AirBNB. Local residents make use of these platforms and the cheaper alternative they fill in the holiday market, why punish travelers with more costs.
Air bnb is a very easy scapegoat to any rental shortage problem regardless of the actual facts as to what may be causing it.
The number of Auckland rentals almost halved once NZ was opened to tourists and students last year. Adding GST in April next year may help unless the inequality party gets in.
I'm not sure that Hobarts idea will work as it may be impossible to police. Both Berlin and Bangkok have a ban on airbnb but I have used airbnb in both cities recently.
Housing and infrastructure shortages are a sign of success, Sir John Key himself said so.
Clearly he meant his personal success, having taken up the position of the chair of NZ's largest mortgage lender shortly after retiring from politics, a position he still holds 7 years later. His son used his contacts to jump into the development game recently partnering with the proud brothel owning Chow family.
I don't expect Singapore-style meritocracy but is it too much to expect better leaders than such buffoons?
Alot of councils already put a limit too nights that a property can be air BNB before extra charges come into play. And also rates increase in some regions if the property is air BNB
Most regions require a consent to be an air bnb over a certain number of nights. This usually means an upfront cost plus higher rates.
Nz Councils already do. They make you pay commercial rates. Still better net yields with airbnb though.
Agree and also has the advantage of you being able to use the property, especially for those of us living in rural areas.
"Still better net yields with airbnb though"
Here is the main reason that houses that might have been in the long term rental market are in the short term rental market by non owner occupiers.
To start with maybe less than 10% of properties would make good airbnbs.
Something miles away from cbd in the suburbs won't get bookings and won't end up being worth the hassle.
Seasonal stays also mean only 6 months of bookings so likely poor returns there also.
It's not the cause of rent increases, attacks on accommodation providers by lie-bour govt coupled with 50 year high net immigration is the reason the trend in rents has just started to point upward at an alarming rate.
I've always argued these businesses should be charged a commercial differential rate.
You mean commercial interest rates by banks?
That's up to them and their risk assessment.
What I was talking about was local council rates which are tied to the use of the property. Short term stays is a commercial use according to some that differs from long term rentals somehow (not as if they'll be using the toilet any more or local amenities any more if they are short term v long term tenants).
No, the same targeted local government rate differential as is applied to commercial property in the city/district. Most LAs have an existing targeted rate for commercial properties, as much of the economic development expenditure of councils reflects a direct benefit to businesses and often it is businesses and/or leisure amenities that attract visitors (who use short-term accommodation) to a city/town or region. Short-term accommodation other than residential BNB-type properties pay a commercial differential (e.g., motels, hotels).
Ok well this is a council-by-council thing obviously. As I know for a fact many councils "hunt down" airbnb's and apply the councils commercial rates to them. something like this in Auckland:
https://www.aucklandcouncil.govt.nz/property-rates-valuations/your-rate…
Pncc for example doesn't appear to have similar. Not as "tourist destination" as others (unlike your into stock cars) but a lot of airbnb's doing well there not paying business/commercial rates.
"That's up by $25 a week (+4.5%) compared to April last year" - after inflation it is down about 3% compared to April last year.
Yeah and when you compare it to the 20+% increases in Sydney and London it looks extremely good. May it continue to help Kiwis stay here.
Makes sense looking at lastyears net migration numbers.
This year the trend is up I wonder how strong the effect on rentals will be by end of year. https://www.nzherald.co.nz/business/new-migrant-numbers-up-greatly-desp…
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And accommodation supplements will be up by at least half that percentage rise next year.
Locking in the increased rents.
Here’s an unpopular opinion - bottom of the housing market was last month. Disagree if you wish but I’ve seen enough to know so. It’s never clear until a few months down the track.
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