Auckland rents keep soaring, others slip

Trade Me Property head Nigel Jeffries

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Auckland tenants are now paying $400 per week for properties regardless of size or type.

Even the smallest unit or one-bedroom home will cost a typical Auckland renter $400 per week, with median rents rocketing up more than 8% in the past year.  

Trade Me [NZX: TME] Property head Nigel Jeffries says tenants can expect to pay $499 per week for a typical property, taking annual rent costs close to $26,000 – about $2000 more than a year ago.

This is the second highest annual increase in the past five years. The highest increase was in September 2011 when median rents went up 9% year-on-year.

“It piles more pressure onto the cost of living for tenants,” Mr Jeffries says.

“Over the past five years weekly Auckland rents have risen by 28%, adding $5500 a year to the costs of renting a typical property across the city. The first eight months of this year alone have added $2000 a year to the cost of renting – a hefty price to pay for tenants.”

To put Auckland’s median rent changes in perspective, the average asking price for a residential property for sale has soared by almost 63% over the past five years. And in the first eight months of this year, the average asking price of a typical Auckland home has increased by almost $80,000.

In contrast, median asking rents in Christchurch are dropping, down almost 5% on a year ago to $429 per week.

The Christchurch rental market was extremely hot two years ago, with median asking rents rising more than 13% year-on-year.

In March this year it peaked at a weekly rent of $495 to surpass Auckland, but Mr Jeffries says rents have eased back every month since and Christchurch tenants are now being asked to pay $3400 less a year.

“It is good news for tenants in the Garden City with median asking rent falling 5% last month to $429 per week, while Auckland sat at the other end of the see-saw,” Mr Jeffries says.

Across the rest of the country, median asking rent remained relatively stable for the fourth month in a row, up $3 to $360 per week.

Over the past five years, the median asking rent for a property outside of Auckland has increased 20% from $300 per week in August 2010 to $360 per week in August this year.

Around 11,000 rental properties are let via Trade Me Property each month.

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11 Comments & Questions

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Having only ceased renting 2 years ago I found the headline "nothing less than $400" weird.

I went onto TradeMe's own rental section for my part of the city where I had been renting previously (Titirangi @ $450/wk for 3 bedroom house) and found prices ranging from $290 to $600.

Now I clearly don't have the skills to be "Head of Property" or anything, but according to my mathematics $290 is $110 less than $400. Even the averaged price was considerably less than the $499 quoted.

I ran it again for another area I'm familiar with (New Lynn) and once again found the headline figure to be cobblers.

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I do wonder sometimes how anyone on a lower wage can afford to live up in Auckland. Even when these individuals are shacked up with others and just able to squeak by paying 40%+ of their take-home income on rent, with no other luxuries or bills included, is it really such a great way to live? A few of my family members (and A LOT of people my age) were unable to fight the allure of the big city in their mid-late 20s/early 30s and spent huge amounts of money "living the lifestyle". Now they have hit later life and realised they have paid a high cost for such folly with no savings, no house and very little in assets or, even worse, net debt. They now want to move to the regions where they can actually afford a house for about 60-70% less (shock horror!) than what it costs to "live" in Auckland. I suspect this is being repeated ad infinitum across NZ, and a lot of OECD countries across the world.

The sooner you learn to be flexible with the market cycles by changing your job/life and go where you can afford to live AND save, the better. Some learn this lesson early, some later, and some never; I am thankful every day to be in the former category!

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Fully agree with the above comments.

If you choose to live in Auckland (and unless you're living for free on Her Majesty at Mt Eden you are choosing) then you are choosing to pay Auckland rents, and are choosing how close to work you wish to live, choosing what quality of house you wish to live in, and choosing whether you want to pay more now and get more capital gain vs. pay less now and get less gain.

If you choose to live in Auckland, with Auckland house prices and Auckland traffic (and Auckland people), and are not being paid a premium compared with Wellington, Christchurch or smaller regions; then more fool you.

Imagine if people were whinging about not being able to buy a Mercedes for Corolla prices?

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So are you saying that nurses, teachers etc. should be paid an Auckland premium then? Or should Auckland just go without those sorts of essential services as the people who are not paid a premium to do those jobs compared to elsewhere in New Zealand get priced out of the city?

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Yes people should expect to be paid more in Auckland, but this should not be formalised as an 'Auckland premium'.

As a school teacher (a profession the regions are screaming out for), if you choose to take a job in Auckland for the same salary you could receive working in New Plymouth, Masterton or Westport; then you are either accepting that you are paying a premium for the 'Auckland lifestyle', or else you have some serious logical failings and probably shouldn't be teaching others.

Clearly the Unions aren't earning their dues if they can't get teachers and nurses higher salaries in Auckland.

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Wow - so all of us born and bred in Auckland, with family connections here should move according to you like its some "fault"?
Interestingly the population growth contributing to rampant house inflation and gridlocked traffic was caused by others moving to darn Auckland from the rest of NZ and overseas! Not us!

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Well, yes, you should have to move.

Someone has to make room for cash-rich foreign buyers who wish to live in NZ's biggest city. If not you, then whom?

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Touche' - Haha - yes that seems to be the directive of the current government (who I've regrettably voted for 3 x....but not again ;)) Screw the loyal citizens of NZ - sell the lot including kitchen sink to rich foreigners who have zero interest in our way of life (or paying tax)..lets speculate and inflate everything to make the numbers look good.

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I have a lovely 3 bedroom renovated house in Takapuna Auckland that is hard to rent out especially in Winter. I was so desperate to rent it out in July 2015 being vacant over a month I took a hundred dollars off the rent and gave a free month.
I also tried selling the house recently but hardly any one turned up to the open home and it was vacant which was costly, no one bidded at the auction, to the agents frustration.

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Were you commanding 30-40%+ over the CV?

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a twist to this conversation - I fall into the category of being an Aucklander who has to rent - I sold my house to support my business, which struggles.

I rent now in Sth Auckland [have been for 3 years] & now have to shift. The renter's market now is extraordinary - the most overwhelming change I notice is every sales girl [they are girls] for the Agents are Asian - and moreover, every property is owned by Asians..

Smell the roses people !

and I see today the head honcho in China wants some reassurance about 'NZ's investment policy' from visiting Brownlee [?] when they don't allow any foreign purchasers..

There's a real problem & it needs a rational, not racist resolution.

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