by Miriam Bell
Barfoot & Thompson has released its rental update for the October-December 2016 quarter and the results fly in the face of public perception.
The update shows that while average weekly rents might be high in Auckland, landlords are not raising them at a breakneck pace.
Across all property types and locations, the average weekly rent increased by just 4.4% on the same quarter in 2015.
This left the average weekly rent at $524 in the December 2016 quarter, as compared to $502 the year before.
South Auckland’s average weekly rent increased the most, with growth of 6.3% over the year.
This is in contrast to Central Auckland where the average weekly rent was up by just 2.6%.
Barfoot & Thompson director Kiri Barfoot said rents have risen at quite a modest rate given the record house sales prices seen last year, along with high demand for rentals.
Most property owners would prefer to have a trustworthy long-term tenant, paying rent on time, to asking for higher rent, she said.
“Landlords obviously consider the return on investment, but are very conscious an empty property doesn’t pay rent.
“This is why we don’t tend to see tenants being hit with large rent increases even when house prices or interest rates rise.”
It was one and two bedroom rental properties that saw the biggest rent increases over the year.
For the first time, the average weekly rent for a one bedroom property in all areas of Auckland passed $300.
The average weekly rent for a one bedroom property rose by 5.1% over the year to hit $344 in the December 2016 quarter.
For two bedroom properties, the average weekly rent also saw a 5.1% increase over the year to reach $437 in the December 2016 quarter.
However, three bedroom properties are the most common rental and the best reflection of what the overall market is doing, Barfoot said.
The average weekly rent for a three bedroom property in the December 2016 quarter was $525.
This was an increase of less than 1% on last quarter ($520) and of 4.4% on the same quarter in 2015 ($503).
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