Rental price growth is easing in Auckland

Friday, 24 January 2025

Auckland rents were up 3.89% annually to a weekly average of $689, Barfoot & Thompson says.

Auckland rents are still rising, but the pace of the increases is slowing, Barfoot & Thompson says.

The average weekly rent across the 17,500 properties on its books was up 3.89% annually to $689.78 in December, according to the real estate agency's latest quarterly rental update.

It means tenants are paying $26 more per week than in December 2023 when the average weekly rent was $663.97.

But rent increases hit a peak of 5.69% in the first quarter of the year, and since then the level of quarterly increases has reduced, the agency’s data showed.

Barfoot & Thompson general manager of sales Grant Sykes said the shift came off the back of easing market pressures that drove higher-paced price growth in the first half of 2024.

Average weekly rents in Central Auckland were up 2.76% in the year to December.

“In early 2024, tension between high demand and constrained supply was intensified by factors like the return of long-term visitors and international students to the city, record-high net migration and even the ongoing impact of 2023’s extreme weather events.”

From the middle of the year, things had begun to level out, with a continued decline in net migration through decreasing arrivals and increasing departures, he said.

“Along with this easing of demand, it is likely new supply is coming to the market from some property owners listing their homes for rent while overseas.”

Weekly rents rose the most in the rural Franklin/Manukau area, where the average was up 5% to $616.45, and South Auckland where it was up 4.70% to $633.09.

At the other end of the spectrum, the eastern suburbs and central Auckland had the lowest increases in rents, with their averages up 2.04% and 2.76% to $750.04 and $589.58 a week respectively.

Pakuranga/Howick had the most expensive weekly rent at $752.23, and by size one-bedroom properties had the highest rent rise, up 4.56% annually to a weekly average of $458.53.

Sykes said the agency’s property managers reported that in late 2024 many people were prioritising their end-of-year finances over the added cost of moving house.

The median asking rent for Auckland properties advertised on Trade Me fell 1.5% in December from November.

It had likely subdued activity in the last few months of the year, and delayed the typical upswing in activity usually seen in spring, he said.

“That said, property managers have been reporting a noticeable shift since late December, with more looking for new properties and attending property viewings.”

Trade Me Property’s latest Rental Price Index, which was released on Friday, supported the easing Auckland rent trend revealed by Barfoot & Thompson’s figures.

It showed the median asking rent for Auckland properties advertised on the website fell 1.5% in December from November. That left the region’s median at $600, unchanged from the same time last year.

Trade Me’s figures showed modest annual rent movements, either up or down, around much of the country, except for Otago and Southland where asking rents were up 11.6.% and 6.8% to $625 and $470 respectively.

Wellington rents remained unchanged at $650 a week, while in Canterbury rents were down 0.9% to $565. The national median weekly rent was up 0.8% to $630.

Trade Me Property customer director Gavin Lloyd said a month-on-month drop in rental listings around the country was a consistent seasonal trend.

“This downturn can largely be attributed to the Christmas break, a time when prospective renters may hold off on their search until after the summer holiday.”