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Real Estate Investar Blog

Rents increase as landlords use new year to review costs


The start of the new year has meant a rent rise for tenants around the country.

The latest Trade Me Property Rental Index shows the national median asking rent increased from $420 to $435 between December and January, after very little change through 2015.

Head of Trade Me Property Nigel Jeffries said it was expected. "It's a trend we see each year as many landlords look to adjust their rental incomes at the start of the year."

Auckland tenants got off lightly – the median weekly rent only edged up $5 to $500 a week. The city's rents increased 4.2 per cent over the year.

"Rents in the City of Sails have been hovering around the $500 a week mark for some time and don't look like changing drastically in the coming months. This plateau indicates a good supply of rental properties in Auckland and landlords aren't going to get any extra assistance on their mortgages for the foreseeable future," Jeffries said.

Over the past five years, Auckland's median rent was up 28.2 per cent, adding $5720 to the median annual rent bill.

January's rent increases were bigger in other parts of the country.

Wellington recorded a $40-a-week jump in median rent between December and January to a new record of $450.

The Bay of Plenty had a $25-a-week increase to $395.

"The growth in the Bay of Plenty is extraordinary," Jeffries said.

Christchurch landlords have seen their returns stall as weekly rents remained at $420 a week for the fourth consecutive month, down 6.7 per cent over the past year.

The median rent in Christchurch has declined year-on-year for 10 consecutive months. Since the peak of $495 a week in early 2015, rents have fallen around $75 per week and saved tenants just under $4000 a year.

Landlords with small houses appear to be getting the best bang for their buck in the rental market.

Outside Auckland, the median asking rent for these properties rose by 5.3 per cent over the past 12 months. Auckland was up 5.1 per cent.

In Wellington, large houses recorded a "massive" increase in median weekly rent, Jeffries said, jumping $55 in the past month to top $875 a week – the highest weekly rent for this category of property across the country and $100 higher than Auckland.

Jeffries said with the start of the academic year Trade Me Property looked at the cost of renting in New Zealand's major university cities.

"Since January 2014 all of the major university cities around the country except Canterbury have experienced serious increases in the median weekly rent.

"Students in Auckland now need to find an extra $50 a week while students in Palmerston North and Dunedin are paying $25 and $30 respectively more than they were two years ago."

Hamilton's median asking rent has increased from $325 in 2014 to $360 this year.

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