Landlords still hold the upper hand - just

CoreLogic’s latest Housing Affordability Report shows this figure has been on a slow and steady upwards trend since late 2018 and is now a new record high – or in other words, the worst position on record for rental affordability.

Rental affordability has been steadier around the main centres, although Tauranga does look a bit more stretched – 30% of gross average household income is required to pay rent, about 3%-points above average. Dunedin’s figure is 26%, compared to the average of 23% and Hamilton sits at 22%, again above the normal 20%.

The affordability situation for renters in Wellington is also tougher than it’s been for at least 17-18 years. CoreLogic’s senior property economist Kelvin Davidson says an important point to note the relatively easy commute to higher-paying jobs in Wellington City may flatter local owners’ and renters’ affordability in the Hutt Valley and Porirua. “In other words, if we looked at a local wage for those areas, affordability may be worse.”

Auckland’s ‘rent burden’ is closer to normal - 21% versus the average of 22% - and in Christchurch it’s a similar message that rental affordability doesn’t look quite so stretched. However, if a renting household earns significantly less than the average income, then the affordability position will be worse than these figures suggest.