Rents not keeping pace
Rents are lagging a long way behind house prices, the latest Trade Me rental price index shows.
Thursday, January 22nd 2015, 12:00AM
by The Landlord
The national median rent on the site was unchanged at $400 per week in December, and was up just 5% on the same time in 2013.
Head of Trade Me Property Nigel Jeffries said the rental market was stable through 2014.
"We saw the national median weekly rental land at $385 in January, then it gradually eased up to $400 in the middle of the year. It stayed there for the rest of 2014."
He said the situation for rentals was a stark contrast to the residential sales market.
"Around residential property for sale we’ve seen continuous price pressure and an inflation rate of over 12% throughout 2014. Clearly many landlords are more focused on capital appreciation rather than yield."
Over the past five years, the median rent nationwide has increased just $50, according to the site’s data.
Only two of the 15 regions Trade Me covers reported double-digit percentage growth in rents in the year to December. In Bay of Plenty, the median rent increased 13% to $340. Taranaki also posted a 13% increase, to $350.
Northland’s median rent hit a record $300 per week in December.
Wellington and Christchurch recorded rent increases of 3.9% and 4.8% respectively. Auckland’s median rent was the same in December 2014 as it was in December 2013.
Jeffries said the most demand was for houses with three or four bedrooms.
In Auckland weekly rents for those properties ended the year back at the peak of $520 per week first reached in April 2014.
But Jeffries said demand for units as an affordable option was also driving rents int he main cities. "With annual growth of 7%, weekly rents for units in Auckland were $375 per week in December, up from levels of $350 at the end of 2013. In Christchurch units ended the year at $340 per week, up 6%from a year ago."
| « Strong December for Harcourts | 'Auckland effect' spreading: QV » |
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