Small dwelling rental prices reach all-time high

Apartment, townhouse and unit rents have reached an all-time high, up 6.3 per cent nationally in the past year to $420 a week but 20 per cent in the past three years, the latest Trade Me Property rental index shows.

Nigel Jeffries, Trade Me Property head, said rents for these types of properties were on average $420 a week but much higher in Auckland at $490 a week.

Auckland apartment rents rose 6.5 per cent in the past year to an average $490 a week, townhouse prices rose 5.8 per cent to an average $595 a week and unit rents rose 4.9 per cent to an average $430 a week, the data showed.

Wellington prices rose faster: apartment rents were up 7.1 per cent to an average $450/week, townhouses up 8 per cent to $475 a week and units up 11.3 per cent to $345 a week.

Christchurch unit rents fell 4.6 per cent in the past year to an average $310 a week, townhouse rents remained unchanged at $400 a week, but apartment rents there were up 5.3 per cent to $400 a week.

Nationally, across all types of rental properties, rents rose 2.3 per cent in the past year, Trade Me said.

“To date, we’re experiencing the lowest period of rent increases in five years. This is quite the contrast to 2016 when the annual rent growth was nearly double at 4.4 per cent,” Jeffries said.

The index comes from properties advertised on Trade Me, where around 11,000 properties are displayed each month.

Last month, Barfoot & Thompson said Auckland residential rental yields or landlord incomes rose for the first time in three years.

“Returns for Auckland rental property owners look to be on the up with gross rental yields for three-bedroom homes in over half the city’s suburbs rising in the first half of 2017 compared with the same period last year. This follows a steady decline in rental yields observed since 2014,” the agency said.

Kiri Barfoot, a Barfoot & Thompson director, said that was good for landlords and “exactly what you would expect to happen at some point in response to moderate but consistent increases in rent and slowing of house sales prices”.

Crockers said the average weekly rent for a three-bedroom property in Auckland softened from $630 to $616, compared to the national figure rising slightly from $450 to $460 a week, resulting in the premium falling from 40 per cent to 34 per cent.

“Over the past month average Auckland rents for a two-bedroom residential property have remained relatively stable at $479, while twobedroom rents across New Zealand have increased from $380 to $400,” Crockers said.