National rental supply surges

Media Release: Thursday 14 April 2011

National rental supply surges

The demand from tenants for rental properties across New Zealand is lagging behind as supply increased 11% over the past quarter, according to an analysis of listings on Trade Me Property.

Brendon Skipper, the head of Trade Me Property, said supply had turned the corner in the last quarter of 2010 after a period of decline and was now taking off. “Over the past three months in cities like Tauranga, Dunedin, Hamilton and Wellington we’ve seen the number of properties up for rent outstripping demand from prospective tenants.”

In Auckland, supply was “incredibly tight” (down 13%) and demand from prospective tenants had “gone nuts” and spiked up by 18%.

“Anyone who has been reading media coverage in recent months knows Auckland is tough if you’re looking for a place to rent at the moment. Average weekly rent across the city is up 7% on a year ago, and it’s inevitable that will continue to rise if demand stays crazy and supply stays low.”

Tenants may consider looking further afield – in Manukau and North Shore the number of properties available for rent is up 10% and 6% respectively. With demand down in the past quarter, landlords in those cities would undoubtedly welcome interest from potential tenants.

In Wellington and Dunedin, the traditional New Year surge in demand was well and truly over with both regions now in a position of oversupply. “Students at Victoria and Otago, and public sector workers from the capital have found their flats and settled in for the year, so in these cities landlords have a harder job filling their properties than three months ago.”

In Christchurch, the main impact of the earthquake has been a flat-lining in the number of properties available for rent – anything available is being tenanted swiftly. The number of enquiries from prospective tenants had increased 7% on a year ago, but there was little evidence landlords were taking advantage of the disaster.

“Any vultures must be few and far between because although average weekly rent has gone up 5% compared with a year ago, Christchurch is only slightly ahead of the national average of 3%. To put this in perspective, that lags the entire Auckland region, Palmerston North and Rotorua.”
% change: Q1 2011 vs. Q1 2010
(excludes apartments)
Area Supply Rent per week Demand
Auckland City - 13% 7% 18%
Manukau City 10% 8% - 4%
North Shore City 6% 8% - 1%
Waitakere City 1% 6% 10%
Christchurch City 0% 5% 7%
Dunedin 9% 2% - 11%
Hamilton 20% 4% - 11%
Wellington City 17% - 2% - 8%
Lower Hutt 16% - 0% - 15%
National 11% 3% - 1%

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