The summer rental rush has already begun in the capital after the median weekly rent in Wellington rose a ‘whopping’ 10 per cent on last year to reach $495 per week in October, according to the latest Trade Me Rental Price Index.
Head of Trade Me Property Nigel Jeffries said looking back over the last five years, rents in Wellington typically start heating up in December but this year had kicked off early. “Demand in the capital is massive, with 13 Wellington rentals in the country’s top 20 most popular rental listings during October. It’s just the beginning too, summer is around the corner and rents look set to break the $500 mark for the first time.
“The median weekly rent in Wellington City is just $10 behind Auckland City, after climbing 10.2 per cent on the year prior to $540.”
Mr Jeffries said tenants looking for a rental in the capital will be pleased to know there were 6 per cent more rental properties onsite than last October which should be easing some rental pressure.
“Aside from the headline rental asking prices, tenants looking for a property in Wellington City have some good news in that there has been a 15 per cent boost in the number of listings. But of course the demand is extraordinary and showing no sign of letting up.
“Tenants looking for a property are facing tough competition and it’s only going to increase as more do the traditional ‘summer shift’ as tenancies come up for review and university students come to town.”
Wellington’s most popular rental in October was an affordable one-bedroom unit in Petone which had 73 enquiries in its first two days onsite.
Table 2: Wellington’s most popular rental listings in October 2018
|Rental address||Suburb||Enquiries in first 2 days|
|2||Norway Street||Te Aro||66|
Rents rise nationwide
“Tenants across New Zealand will be digging deep into their pockets after the median weekly rent rose 6.7 per cent on the year prior, and remained at an all-time high of $480.”
Mr Jeffries said rents in Northland (up 10.5 per cent to $420) and Waikato (up 6.3 per cent to $420) reached new highs in October and crept closer to the prices of the nearby Super City. The median weekly rent in Whanganui (up 13.3 per cent $340) was another region to break a record in October while every other region saw a year-on-year increase.
“Supply is struggling to keep up with demand across the country after a 3 per cent drop in the number of rental listings year-on-year. With rising house prices, we suspect it’s taking Kiwis longer to save for a deposit and as a result many are having to stay in rentals longer,” he said.
Auckland rents hold firm
“Auckland’s median weekly rent remained at $550 for the seventh month in a row, up 4.8 per cent on last year as demand increases in the Super City, ” Mr Jeffries said.
He said the number of enquiries for Auckland rentals in the first two days onsite was up a ‘significant’ 20 per cent. Manukau City was the most popular place to rent in October, with a 38 per cent increase in the number of enquiries in the first two days onsite.
“While rents in Auckland have remained relatively flat over most of 2018, we are expecting they’ll heat up in the summer months as tertiary students return and supply continues to battle to meet demand. We predict Auckland rents will get very close to the $600 mark early next year.”
Table 1: Auckland’s most popular rental listings in October 2018
|Rental address||Suburb||Enquiries in first 2 days|
|1||Albert Street||City Centre||61|
Strong double-digit growth for houses in Wellington
“All house sizes in Wellington experienced strong double-digit growth in October with medium houses (3-4 bedrooms) climbing the most, up 11.5 per cent to $580 per week.”
Mr Jeffries said small houses (1-2 bedrooms) continue to be the hot favourite across the country after they reached a new high of $400 a week in October, up a solid 6.7 per cent on last year.
“Outside Auckland, small houses saw the greatest increase rising 9.1 per cent on last year to reach a new high of $360 a week.”
Table 4: Median weekly rent by property size & region: Oct 2018 vs Oct 2017
Urban properties continue growth
Mr Jeffries said the median weekly rent for urban properties (units, townhouses and apartments) increased 6.1 per cent on last year to $435 in October - just $5 shy of August’s record.
“New Zealand-wide townhouses, have experienced strong annual growth, up 8.7 per cent to remain at the record median weekly rent of $500 seen back in February this year. Units dipped slightly on August’s record high of $390 to $385 in October, but were still up 6.9 per cent on last year,” he said.
Table 3: Median weekly rent by property size & region: Oct 2018 vs Oct 2017
About the Trade Me Property Rental Price Index:
This report provides a comprehensive monthly insight into the rental market covering price trends by type and size of property across New Zealand. The index is produced from Trade Me Property data of properties that have been rented in the month by property managers and private landlords. On average over 11,000 properties are rented each month and the report provides a comprehensive insight into this part of the property market for tenants, landlords and investors. The index is calculated using the median rent in the month, this being an accurate statistical assessment of the current rent being charged by landlords and property managers.