Number of empty rentals at its lowest
The number of empty rentals in Hamilton is as low as they ever get, with one agency reporting less than a handful available.
Property management company Waikato Real Estate is at 99.7% occupancy across 1300 properties, said manager Oliver Pearson. “That's really as low as it ever gets in terms of vacancies. The market is super tight at the moment so [it’s] quite hard to come by a good rental if you’re looking for one.”
Oliver and wife Michelle Pearson, who is the head of growth, said they have numerous anecdotes of people looking for homes, including a family of eight who were considering splitting the family up while they searched.
It was mostly families looking for properties but competition was tough, with up to 30 people showing up to one viewing.
The rental price average was up 7% compared to this time last year, Oliver said.
New Zealand’s annual net migration hit a new record of 126,000 last year while Hamilton’s population grew by 3.4% between June 2022 and 30 June 2023.
Lodge’s Jeremy O’Rourke said migration and foreign buying rules had put the squeeze on a market that was already under significant pressure and the issue was being compounded by a lack of investors willing to buy before the government ironed out details around interest deductibility and bright-line testing.
The foreign buyers ban, introduced by the Labour government in 2018, prohibits the sale of existing homes to non-NZ residents. “At the moment we're still waiting on the detail - even the bright-line test, I think there are a few questions being asked. So from July 1 property that's sold, it's only a two year bright-line test but there's argument about what that actually means. And there's been no detail released yet around that.
“We get a lot of investors who are inquiring at the moment who are interested in residential property but until they have clarification on the bright-line, until they have clarification on particularly interest deductibility and what implications there are around that they're not really prepared to commit, particularly if they're leveraged investors.”
The worst part about it was that, of Lodge’s 3800 rental properties, only nine were currently vacant, O’Rourke said. There is a real demand for rental property. And we just don't have the investors who are here.”