Rental asking price remain stagnant for third month in a row: Trade Me

Monday, 15 May 2023

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What landlords can earn in rent appears to have stagnated, with the median amount being asked for remaining unchanged for three months in a row, Trade Me data shows.

The website’s data showed the weekly rent landlords were asking for had risen by 3% across the country since April last year. That equated to an increase of $20 per week during that period, going from $580 to $600.

But data from Stats NZ indicated landlords were not always getting the rent they asked for. Stats NZ’s Rental Price Index shows over the same period the amount households paid in rent for new tenancies increased 2.8%.

Trade Me’s rental price data only includes the rent price that landlords were asking when they listed their property on the site, not the amount that renters ended up paying.

In March, when Trade Me’s median asking rent was also at $600, data from the Ministry of Business, Innovation and Employment showed median rent for all properties with a bond lodged sat $40 lower, at $560.

“As rentals are listed as a classified on our site we do not have visibility on what the final agreed rent is, therefore, the bond lodged may be different from the advertised rent,” Trade Me property sales director Gavin Lloyd said.

Investor Tammy Onekawa, who owns properties in New Zealand and Australia, recently questioned whether Kiwi landlords could get higher rents, given the high prices tenants were already paying.

“My mind boggles at the cost of rent anyway, especially in New Zealand, because they are so high, and yet the increases come, and it still gets paid, I wonder when does it get to the point where people just can’t do it?” she said.

Asking rent had increased by a greater amount in some areas, going up $50 a week in Manawatū/Whanganui to reach a median of $530 per week, Trade Me reported.

“And it was almost the same in Canterbury with an extra $45 to $540,” Lloyd said.

Trade Me property sales director Gavin Lloyd says Southland median asking rent was $100 cheaper than the next most affordable region.

Southland had seen no increase in the last year, with median weekly rents advertised on the platform remaining at $430.

“There are many factors why Southland’s median price isn’t rising, including it being one of the most affordable markets to buy in - it’s about $400,000 for a first home, meaning there aren’t the same pressures on the rental market,” Lloyd said.

April’s rental stock was down 19% compared to 2022, Lloyd said, and Auckland was down 36%.

Trade Me said demand was up 36%, based on email inquiries.

Despite extensive damage from flooding, Hawke’s Bay increased its rental stock by 1%.

“This could be for a number of reasons, including anecdotally we heard some people were shifting their short-term rentals to long-term to help ease the pressure in the community,” Lloyd said.

“Demand in the Bay also dropped by 2%.”

Wellington rental asking prices were up 4% on a year ago. Landlords have been reporting getting less for their properties in the capital, with fewer students and the cost of living attributed as possible causes.