There has been strong growth in residential rents in the last 12 months, with rents in Wellington close to catching up with those in Auckland.
Bond data from the Ministry of Business, Innovation and Employment’s Tenancy Services division analysed by interest.co.nz shows that the average rent from new bonds received from throughout New Zealand in the second quarter of this year was $450 a week, up 7.6% compared to the second quarter of last year.
That means that on average, renters are likely to be paying around $32 more a week in rent than they were 12 months ago.
And the rate of increase is also on the rise.
Between the second quarter of 2017 and the second quarter of 2018, the average rent increased by just $19 a week (4.9%).
However there are substantial regional differences, with rents generally rising more slowly in Auckland and Christchurch than in most other parts of the country.
This country’s most expensive rental district is Queenstown-Lakes, where the average rent in the second quarter of this year was $638 a week, up 8.8% compared to the second quarter of last year.
That was followed by the Auckland region, where the average rent increased by $16 a week (3.0%) between the second quarter of last year and the second quarter of this year, from $515 a week to $531 a week.
However the 3% growth in rent was down slightly from the 3.5% increase over the previous 12 months.
Significant differences within Auckland
There are also significant differences within the Auckland market, with the biggest increases occurring in the region’s western and southern districts with annual increases of 7.8% in Franklin, 5.4% in Waitakere, and 5.0% in Papakura, but just 0.8% in Rodney which was the lowest percentage increase in the country, 1.9% in Auckland’s central suburbs and 2.2% in Manukau.
Of the main centres, Wellington posted the biggest increase, with the average rent in the Wellington Region hitting $504 a week in the second quarter of this year, up 11.1% compared to a year earlier.
The rate of increase was even higher in Lower Hutt at 13.9% and Wellington City at 12.1%.
The higher rate of rent growth in Wellington compared to Auckland means the difference in rents between the two regions is rapidly narrowing.
In the second quarter of 2017, the average rent in the Auckland region was $65 a week (15%) higher than in the Wellington region. But in the second quarter of this year that gap had reduced to $27 a week, or 5.4%.
Modest rental growth in Christchurch
Rental growth in Christchurch has been at very modest levels for the last two years.
In the second quarter of this year the average rent in Christchurch was up just 1.2% compared to the second quarter of last year, which was half the rate of increase over the previous 12 months.
Christchurch’s average rent of $381 a week was lower than the average rent in any of the North Island’s rental districts except New Plymouth, Palmerston North and Whanganui.
Rental growth between the second quarter of last year and the second quarter of this year was between 5% and 10% in most provincial districts.
The table below shows the average rent in all districts in the second quarter of this year, and the annual percentage change for the last two years.
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|Average rent $/week||% Change||% Change|
|Q2 2019||Q2 17 - Q2 18||Q2 18 - Q2 19|