Rent rising faster in Hawke's Bay than anywhere else in NZ: Trade Me stats
Hawke’s Bay tenants have endured New Zealand’s highest hike in rents over the past year, new figures reveal.
The latest Trade Me Rental Price Index shows the national median weekly rent was up 6.7 per cent on last year, remaining at a record high of $480 for a third consecutive month.
“Every region in the country saw an annual increase in August and three regions reached record weekly rents,” Trade Me’s head of rentals Aaron Clancy said.
“Hawke’s Bay led the pack with a 13.9 per cent bump to a new record of $410.”
The median rent outside New Zealand’s three major cities has risen 10.5 per cent to $420 – a record for August.
High rental prices also continued to affect Auckland.
The median rental price in New Zealand’s biggest city remained at a record high of $550 for the fifth month in a row – up 3.8 per cent on last year.
Official statistics from the Ministry of Business, Innovation and Employment show the Hawkes’ Bay average mean rent was just $379 a week – unchanged from the previous month – and up only $32 from August last year. That was a rise of 9.2 per cent.
The New Zealand Property Investors Federation’s Hawkes’ Bay-based president, Sharon Cullwick, said although investors and landlords faced rising costs nationwide, the situation in Hawke’s Bay was more complicated.
“One of the main issues for Hawke’s Bay is the increase in insurances, which is happening all over the country but because we are known to be in a high-risk earthquake area.
“My own insurances, per property, have gone up $700. So, that’s one reason.
“The rates in Hawke’s Bay have also gone up a lot, especially the regional council’s rates.”
The NZPIF had sent out a survey to all 275,000 private landlords to get their perspective on the situation regarding proposals to reform the Residential Tenancies Act and also the Healthy Homes Standards definitions.
With government proposals being considered including proposals that landlords must have a heat pump or electrical heating in a lounge area that would heat to a certain temperature, the issue could get even worse.
“For example, I have one house that I have just purchased from a lady who lived there for 80 years but when July 1 comes around next year, I’m going to knock it down. There’s no point keeping it because the cost to get it up to standard is just not worth it.”
Other people were looking at getting out of the rental market altogether, she said.
That would further highlight the disparity between supply and demand.
“They say the average amount of people per rental property is 2.8 people and a home-owner is just 1.8. That means for every house that gets sold to a first-home buyer, you actually still need one other house to house those people and we just don’t have those houses.”
MBIE data shows the mean rent in Hastings was $381 a week at the end of August – up from $347 a week from the same time last year.
Napier’s mean rent was slightly higher, at $399 a week, up from $374 a week in August 2017.
Over the same time, mean rents in Central Hawke’s Bay rose $92 to $340 a week – a rise of 37 per cent.
Wairoa’s mean rent rose only $10 to $246 a week.
Trade Me figures only take into account the median advertised rent on site “asking” price rather than the agreed price, meaning Trade Me data includes rentals with asking rents that have not yet been rented out, whereas government data looks at the average rent of bonds lodged for new rentals.
Tremains Rentals general manager Ruth Shannon disagreed with the Trade Me’s assessment of higher prices.
“Winter has been quite stable for us, we haven’t had the decrease in inquiry that we used to experience in winter – but we haven’t experienced the rent increases that Trade Me are touting.”
There had been a noticeable increase in people travelling to Central Hawke’s Bay for lower rents, Shannon said.
However, she said, supply of properties would be an ongoing issue.
