Residential rents up an average of $40 a week in September year, Auckland rents up $60 a week

Property / analysis

Annual rent increases range from $7 a week in Dunedin to $130 in Queenstown-Lakes

3rd Nov 23, 10:45am by Greg Ninness

Residential rents increased by an average of $40 a week across the entire country in the 12 months to the end of September, with rents in Auckland up $60 a week.

According to bond data from Tenancy Services, the national median rent increased from $540 a week in the third quarter of last year to $580 in the third quarter of this year, giving an annual increase of 7.4%.

Bond data is a leading indicator of movements in market rents, because most bonds are collected for newly tenanted properties, providing a snapshot of where the market is sitting, and most landlords and property managers use market rents when reviewing rents for existing tenancies.

Queenstown-Lakes is the most expensive place in the country to rent a home with a median rent of $750 a week, up by $130 a week (21%) compared to the third quarter of last year.

After Queenstown-Lakes, the biggest increases occurred in Taupo, up $100 a week (22.2%), Whakatane +$90 (19.6%) and Marlborough +$65 (13.7%).

Dunedin had the smallest increase at just $7 a week (1.6%).

Perhaps surprisingly, rent increases were comparatively modest in the Wellington Region, with the median rent in Wellington City increasing by just $10 a week (1.7%) over the 12 months to September this year. Rents in Lower Hutt were up by just $15 a week over the same period. (See the table below for the rent increase figures for all major urban centres).

Within the Auckland region, rent increases ranged from $20 a week (3.2%) in the Rodney Ward on the city's northern boundary, to $83 a week (12.2%) in the Orakei Ward in central Auckland. (See the table below for the rent figures for all Auckland Council ward areas and the map showing the ward boundaries).

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Auckland Council Wards

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95 Comments

by HouseMouse | 3rd Nov 23, 10:52am 1698961976

HFL!

by JimboJones | 3rd Nov 23, 12:44pm 1698968644

Rents will be going down once National give back the tax perks I am told.

by morepork | 3rd Nov 23, 1:01pm 1698969690

Just like fruit and vegetable prices would have gone down ~15% if Labour had got back in and taken off GST

by JimboJones | 3rd Nov 23, 1:07pm 1698970051

A couple of big differences:

1) The 15% GST would apply to all fruit sold, whereas interest deductibility only applies to a subset of landlords (indebted ones).

2) Interest deductibility makes housing a more desirable investment and pushes up house prices and hence rents.

by refactornz | 3rd Nov 23, 1:18pm 1698970721

Rents will be going down once National give back the tax perks I am told.

Who told you that? Not National.

by morepork | 3rd Nov 23, 1:26pm 1698971216

"We're going to put downward pressure on rents by actually unwinding the bright line test from ten to two years, unwinding interest deductibility, and changing some of the tenancy laws."

https://www.1news.co.nz/2023/09/10/luxon-unsure-if-hell-lower-rents-on-…

by RickStrauss | 3rd Nov 23, 1:39pm 1698971973

A great example of Newspeak.

by Flying high | 3rd Nov 23, 2:17pm 1698974255

Interest deductibility makes housing a more desirable investment and pushes up house prices and hence rents

Consent more land, build more houses, problem solved. Maybe?

by morepork | 3rd Nov 23, 3:07pm 1698977246

Unlikely that more rental houses will get built when National's going to remove a tax advantage of new builds.

by Flying high | 3rd Nov 23, 3:57pm 1698980273

Increase the supply of land by consenting and servicing more. The lucky owners who get their land consented are rewarded with an uplift in value. The size of the uplift is determined by supply volumes as well as by demand. We know the demand for affordable housing is high.

If 2000 sections are needed and council release 1000 sections, logic says that the section prices will be up to twice. Thats good for the farmer/landbanker, not so good for the eventual homeowner.

by HouseMouse | 3rd Nov 23, 3:59pm 1698980376

Who pays for all the infrastructure?

by Flying high | 3rd Nov 23, 4:56pm 1698983790

Dumb question. Dont provision new sections then and see what happens

by HouseMouse | 3rd Nov 23, 5:37pm 1698986244

Why is it a ‘dumb question’?

I am talking about all the large scale infrastructure that councils need to provide to service new greenfield subdivisions (obviously small scale ones are an exception). That incurs more debt which becomes a massive burden for councils and ultimately ratepayers.

Take Drury. While the developers have built and paid for a decent amount of infrastructure, Council has still had to incur a lot (I think about $1.5 billion) of debt to come to the party and put in the infrastructure it needs to do. It has also had to reprioritise spending that existing communities were expecting.

by Flying high | 3rd Nov 23, 5:53pm 1698987228

Are you sure about your figures

by HouseMouse | 3rd Nov 23, 5:57pm 1698987473

As a rough order of $, yes

by HouseMouse | 3rd Nov 23, 5:59pm 1698987566

Here you go:

https://www.nzherald.co.nz/nz/auckland-council-has-approved-a-plan-to-c….

by Flying high | 3rd Nov 23, 6:14pm 1698988475

the average development contribution per home will ... $74,142.

1.631 billion over 22000 homes. Add in businesses, shops, retirement villages, maybe some other ratepayers. The expenditure is over 30 years not one year... the average rates still earns the council more than they spend

More small minded thinking by housemouse again. As I said before "don't provsion new sections and see what results from that"

by HouseMouse | 3rd Nov 23, 6:24pm 1698989087

You are totally missing point. Obviously I understand that the debt can be recovered via DCs. The problem is *the debt* when council is near it’s debt ceiling. Also what happens if the development is not as successful as the developers hype it up to be? Or the number of houses delivered is half what they said it would be - noting the first stage of the development is townhouses rather than apartments as planned for, and well less than half the anticipation yield….

Answer me that one, Einstein

by Flying high | 3rd Nov 23, 6:51pm 1698990686

Can you count?

We shouldn't question that while we bow to housemouse the arbiter of investment knowledge

by HouseMouse | 3rd Nov 23, 7:25pm 1698992721

I guess 25 years + in development and construction counts for little in your eyes.

I bid you a good evening.

by Flying high | 3rd Nov 23, 9:29pm 1699000186

And clearly you're a strong supporter of the housing ponzi. Too bad if genuine kiwis, some with families live in cars and shipping containers etc

Someone would think, after that length of time in the industry you'd be able to think outside the square. That you would have some solutions to the infrastructure funding vs actual need conundrum

by K.W. | 3rd Nov 23, 1:18pm 1698970690

Rents on individual properties wont go down, but on aggregate rents will reduce once tax deducitibility is restored on existing properties. The reason is that existing homes rent for less than brand new homes. So by forcing investors to buy new properties, rents have been pushed up. As an example, in my suburb a decent 70's 2 bedroom unit with a garden and garage rents for about $450 a week. A brand new townhouse with no garden or garage rents for $550 a week. There are about two older units available for rent, and about 20 brand new townhouses. Therefore the vast majority of renters will be forced to pay an extra $100 a week to rent a property in the area. By making more $450 a week properties available, rents will come down.

by James Thrace | 3rd Nov 23, 1:45pm 1698972321

Nonsense.

New builds are eligible for interest deductibility so why the increased rent on that basis?

by K.W. | 3rd Nov 23, 2:31pm 1698975085

I think you missed my point - older homes rent for less than brand new homes. Restoring interest deductibility to existing homes will mean investors will return to buying cheaper homes, which they will rent for less than brand new homes. Nothing to do with interest deductibility on new homes, but the absence of it on old homes which means investors dont buy them. Its about making more cheaper rentals available for tenants to choose from not forcing them into higher priced brand new builds.

So average rents fall from 20 times $550 plus 2 times $450 ($540 per week average) - to there being 20 times $450 rentals and 2 times $550 rentals ($460 per week average). Its basic math.

by morepork | 3rd Nov 23, 3:08pm 1698977327

This is short term thinking. Without the tax incentive fewer new rentals will get built, exacerbating the shortage of rentals, particularly given how the immigration taps are being opened.

by Pragmatist | 3rd Nov 23, 3:26pm 1698978416

With the current stupidly high costs of building they aren't getting built anyway.

by K.W. | 4th Nov 23, 12:03pm 1699052614

Or new builds will return to the FHB market like it used to be. Currently FHB are competing with investors for new builds, this raises the price of them (over that from just the build costs) as the benefit of tax deductibility is built into the price but the premium of which is now paid by both investors and owner occupiers. Equalise the tax situation, and investors will return to buying the older houses that most FHB dont want, they will upgrade them to HHS standards, and rent them out. While FHB go buy more expensive brand new homes because its their "dream" home.

Even just removing that tax deductibility premium will lower the price of new builds which benefits both investors and owner occupiers. At lower prices, people will buy more new builds, thus increasing supply. If you need evidence of this, look no further than apartment approvals - more new apartments were sold under National than they were under Labour after the tax changes and a supposed boom in housing.

"Tamba Carleton of CBRE prepared a chart which showed the recent peak in apartment pre-sales was in 2016 when more than 3000 units across the city were pre-sold. She is an associate director within CBRE’s New Zealand research department, specialising in high-density residential research with a focus on the apartment market. She said 2016′s figure fell 83 per cent to just 500 Auckland apartment pre-sales last year. And the situation is not improving."

If tax deductibility increases supply, then why hasnt supply increased???

by James Thrace | 4th Nov 23, 6:52pm 1699077179

Supply hasn’t increased because people who rushed in to buy the Wolfbrook/Williams Corp shitboxes have realised what utter shitboxes with poor construction and cheap materials they have turned out to be, and bought at a premium.

The multi unit infill housing of the past 5 years will be the next major housing issue/crisis after Leaky Homes. I am nominally calling it the “Williamsbrook Rort”.

by DavidJ | 3rd Nov 23, 10:54am 1698962096

bit of a tragedy .. over committed landlords feeling the pinch pass the pain onto renters (who generally can ill afford), immigration floodgates are open, supply languishing .. such a mess

by HouseMouse | 3rd Nov 23, 11:22am 1698963744

Yep

Putting aside the human impact, this of course further eats in to peoples’ discretionary spend, further hitting hospo, retail

by Retired-Poppy | 3rd Nov 23, 11:43am 1698965001

Rising rent/mortgage stress, this only serves to intensify the cost of living crisis. Now there's looming job losses for our country to navigate through.

Using open spigot immigration policies to drive down wage inflation is going to bite this and future Governments fiscally. We are borrowing to maintain and repair - not improve and expand. Our infrastructure was ailing even before this recent surge. I think we're probably staring down another period of civil unrest to be honest. A generation or two of self entitled individuals will start to feel very disenfranchised.....

by RickStrauss | 3rd Nov 23, 12:04pm 1698966269

And we've got NACT coming in wanting to prevent brownfield development in favour of NIMBYism and greenfield sprawl. This will drive up maintenance costs thus increasing Rates, if they do so.

by IanSmit | 3rd Nov 23, 12:04pm 1698966285

the solution?

Anti-depressants for everyone

by FCM | 3rd Nov 23, 12:28pm 1698967734

You have to wonder what line they are being spun to come to NZ. Arrive find out need a hefty savings amount to apply for a mortgage, then get one at huge interest rates, found out most can't afford to get one, go look for a rental (along with 50 others) and demand supply equation takes over. Yeap a real mess.

by timbob | 3rd Nov 23, 7:09pm 1698991788

From what I've noticed, we have a lot of high paid tech workers immigrating to NZ, to earn NZD, and are buying up in new subdivisions.

by tothepoint | 3rd Nov 23, 7:46pm 1698993966

Rent increases of the current magnitude will provide a stimulus for investors - especially since there's a chronic shortage of dwellings.

We can expect a flow-on impact for house values/prices. Up they go - again. 🙃

Landlords/investors with houses in Central Auckland and Central Wellington will do very nicely indeed. But plenty of other localities will prosper as well…...

TTP

by RickStrauss | 3rd Nov 23, 1:18pm 1698970697

Rent increases of this magnitude will provide a stimulus for investors.

New Zealand - the land of the over-stimulated property speculator.

by Te Kooti | 3rd Nov 23, 1:44pm 1698972262

Welcome back TTP, the world feels normal again as we enter another 7 year bull market property cycle.

by HouseMouse | 3rd Nov 23, 1:46pm 1698972405

Hold your horses. I reckon 2025 for the next bull market to truly kick in.

by Retired-Poppy | 3rd Nov 23, 1:54pm 1698972855

LOL! - thanks Te Kooti. Laughter is good for the soul. :)

by nktokyo | 3rd Nov 23, 10:59am 1698962379

Government takes measures to force investors to sell and stop them buying: Everybody cheers.

Rents go up: Everybody boos.

Government brings in a lot of people to ease acute labour shortage and inflation, while leaving in place measures to stop investors from buying or owning. Everybody cheers.

Rents go up: Everybody boos.

This was telegraphed the day Grant Robertson walked on stage and, ignoring treasury and IRD advice, said anybody who rents a property out is hereby a speculator and removed interest deductibility on rentals. It will take 2-3 years to work through the system because a) inflation applies to rents as much as it does to every other commodity, b) the shortage is more acute than normal because tens of thousands of homes went to social housing over the next 2 years, c) it's going to take months to sort out the CCCFA and deductibility rules and d) vested interests are going to relinquish their control over build pricing only when it is ripped from their cold dead hands.

Nothing is going to change until our cost to build goes down. The only people who are borrowing at 7% to rent out at a net yield of 3% on a new build are those who have been tricked by salespeople masquerading as financial advisors. When rents have to possibly double to make building to rent viable then Houston, you have an issue.

by sparrow | 3rd Nov 23, 11:15am 1698963350

Too high rates of migration are the main cause. I see in Canada public support for migration has plummeted over the last 12 months due to their housing crisis, we're just a few months behind them.

And yes the price of land and building and existing dwellings are all far too high, it makes no sense to live here unless you're an existing homeowner.

National and co have a big problem on their hands.

by HouseMouse | 3rd Nov 23, 11:26am 1698963970

But interest deductibility applies to new build rentals. By restoring it to all rentals, there will be less incentive for landlords to buy new builds, worsening the supply / demand imbalance as less new homes get built.

by 1689 Baptist | 3rd Nov 23, 1:32pm 1698971535

Today I learnt that existing houses also get interest deductability if they are rented to Kainga Ora. I wish someone had told me that earlier.

by James Thrace | 3rd Nov 23, 1:49pm 1698972565

Kainga Ora are only accepting applications for new builds unless your property is in an area with limited new builds.

you also have to ensure the existing property is up to all recent Healthy Homes compliance. You are also required to obtain, and pay for, an independent report to prove compliance despite the independent report not being a legal requirement to obtain (some misinformation there from both KO and property managers).

in short, asking KO to rent out your existing house isn’t as easy as it appears. They wanted us to take out our clean air burning wood fire and replace it with a heat pump. No thanks. Wood fires still work in a power cut.

by Fleeced sheep | 3rd Nov 23, 5:12pm 1698984735

JT, consider yourself having dodged a bullet. K.O will tell you they will return your house to its current state, less any fair wear and tear at the end of your contract. They'll then rent it out to someone private landlords wouldnt touch with a 10 foot bargepole and after its properly trashed hand it back as is. Its a David and Goliath battle to get anything out of them, and really not worth the hassle. The lack of control you'll have when dealing with KO wont offset the gain of interest deductability IMO.

by Colin Cameron | 4th Nov 23, 6:29am 1699032578

Yes but also other social housing like the Sallies will allow you to qualify for the tax deduction not just housing NZ

by E46 | 3rd Nov 23, 11:28am 1698964134

I don't doubt that those changes have contributed somewhat but I think the bigger driver will be immigration, investors chasing better yields, and renters ability to pay.

For example Australia, has had zero changes to rental laws, way more landlord benefits than here and full on tax rinsed negative gearing yet their increases are larger than ours. I honestly think even if we didn't remove interest deductability the rental increases we are seeing would likely be exactly the same as they are now.

https://mozo.com.au/home-loans/articles/what-is-the-average-rent-in-australia

https://www.theguardian.com/australia-news/2023/sep/01/australia-rental-price-rice-crisis-data

by Chaosinflesh | 3rd Nov 23, 12:32pm 1698967931

Rents were dropping before the government opened the floodgates. Took weeks for our previous landlord to replace us Aug 22, and they had to drop the rent even to get a nibble.

by HouseMouse | 3rd Nov 23, 12:37pm 1698968223

Labour care so deeply for the working people of NZ!!!!!

by K.W. | 3rd Nov 23, 1:12pm 1698970365

Rents were dropping because most of 2023 had a negative flow of people out of the country. This has reversed. So its no surprise that now NZ follows Australia and heads into an immigration fuelled rental crisis.

by singautim | 4th Nov 23, 4:09am 1699024140

During covid lockdown CBD apartments were empty. I was lucky - my investment property was empty for only a couple of months but then re-rented at 20% less; even now rent is less than it was 5 years ago. It is clearly supply and demand - heavy immigration pushes rents up and leaves Kiwi families living in motels.

by JimboJones | 3rd Nov 23, 12:50pm 1698969011

nktokyo if you are correct then rents should go down (or stagnate) after the tax perks are brought back. I have my doubts TBH.

Also we should have had very cheap rents by world standards as most other countries do tax landlords for their profits. But realistically favourable tax treatment encourages people to invest in property which pushes house prices and rents up.

by FHBtears | 3rd Nov 23, 11:23am 1698963799

Can’t WAIT for this downward pressure from National’s tax cuts for the landlords. Trickle down at its best! Woo.

by ChrisOfNoFame | 3rd Nov 23, 11:43am 1698964984

Best laugh I've had all week. Keep up the good work.

by Jonny.Foe | 3rd Nov 23, 1:54pm 1698972897

Apparently people / new migrants can move more quickly into towns than developers can build houses. Who da thunk it? Now add in the fact that building houses is not really worth it at the moment given building and finance costs, and (lower) house prices, and that, to be fair, some landlords are wrestling with much higher costs. What do we have? A perfect storm for booming rents.

Now, what do booming rents mean? Firstly, a 5% increase in rents adds precisely 0.5 percentage points to our annual CPI. Now add in the impact of workers pushing hard for pay rises so they can actually afford to pay their rent. Now remember that rents in a supply constrained environment rise to what ever people can afford to pay. You guessed it - what we have here is a mutually reinforcing inflationary loop. Now how might we stop that? Well, I guess we could increase interest rates to kill housing construction and increase landlord costs? That would work, no?

by Small Kev | 3rd Nov 23, 11:49am 1698965359

Rent boom likely, many don’t mind house sharing. $400 per room per week, Wi-Fi not included.

Driveway/street full of parked cars…not for me thanks.

by HouseMouse | 3rd Nov 23, 12:09pm 1698966578

Haha brilliant

by Kate | 3rd Nov 23, 12:15pm 1698966905

Now remember that rents in a supply constrained environment rise to what ever people can afford to pay.

Nah, they rise in accordance with what people + taxpayers can afford to pay, given the substantial rent subsidies (accommodation supplements) contributed by taxpayers (possibly rising to $3 billion pa in the next fiscal year).

by RickStrauss | 3rd Nov 23, 1:20pm 1698970807

$3 billion dollars in welfare subsidies to landlords every year, plus price subsidies to benefit property speculators. And National wants to ramraid young folks' KiwiSaver to benefit property for a second time too.

Really hard keeping these snouts out of the trough, eh.

by Kate | 3rd Nov 23, 1:58pm 1698973109

Young voters and renters really had a choice of least best and most worse - and they chose most worse. In other words, no party campaigned on rent control by way of cost lowering. It will have to happen someday. ACT have such an opportunity to reduce government expenditure by $2+ billion per annum in this one line item. They can only but be insincere in their ambition in that regard - take instead from the least capable to retain handouts to those that don't need it. It's all very sad watching it unfold.

by singautim | 4th Nov 23, 4:23am 1699025019

I've often disputed to your calls for rent controls. My experience as a renter in London years many ago persuaded me that rent controls are a perfect example of the law of unintended consequences - London had simultaneously the worst homelessness and highest number of empty houses. They even coined the word Rackmanism. However you may be right rent controls will happen one day because the accommodation benefit as enacted is so obviously dumb. Attempt to save more than $8,000 and it just switches off; move from overcrowded city to rural area and your $370pw drops below $100. Work longer hours or get a pay rise and your benefit dissolves away. Have more children so need a larger property - tough because it only caters for one-child families. Scrap this $3b accommdation benefit and replace it with a straight-forward generous child benefit.

by Kate | 4th Nov 23, 11:09am 1699049356

Great information, thanks. Just like the way we structure all welfare/tax transfers (aside from super), the 'claw backs' make a nonsense of the policy - as the incentive to save and get ahead are all wrong - indeed they are disincentives to save and get ahead. This is where a UBI comes in (which is effectively what super is). The concern I have with child benefits is that they are still a welfare mechanism, as opposed to a regulatory mechanism.

I'm very much in the camp of anything is better than the current accommodation subsidy - it's just unsustainable and fiscally irresponsible. All the NGOs I spoke to who work in this housing space can do nothing but argue for increases in the thresholds and the amount of the supplement itself; as that is the only current government response to the broken housing market. Others argue for a rent freeze which I point out only serves to freeze rents at a level that is already too high in relation to incomes.

A circuit breaker is needed.

by singautim | 4th Nov 23, 11:26am 1699050375

Child benefits are not a welfare mechanism - they are an investment in our future. Tax payers happily pay for children's education, free medicine, etc so why not pay for their food and accommodation.

by singautim | 4th Nov 23, 11:37am 1699051058

The existing very limited rent controls imposed by Labour are impacting the Mom & Dad investors. We bought the house next door with an inheritance plus mortgage about 20 years ago and had it rented out as an investment via reputable agents until recently. Now we live in it with two empty bedrooms because we are too nervous of having tenants we cannot remove. So a small reduction in rental property availability because of a well-meaning piece of legislation.

The problem with investment properties is the investment is in potential capital gains not rents. Just forcing all investment properties to be held as companies paying 27% tax would help resolve it.

by singautim | 4th Nov 23, 11:38am 1699051110

""a rent freeze which I point out only serves to freeze rents at a level that is already too high in relation to incomes"" not if inflation is kept sufficiently high.

by Kate | 4th Nov 23, 5:52pm 1699073535

Not if wage inflation is kept sufficiently high.

by singautim | 5th Nov 23, 2:00am 1699102855

A good distinction but the real world of rental properties for families not students is for periods of many years. Over five to ten years wages and benefits do inflate (although maybe not as much as food prices) so a wage freeze ought to be a temporary measure in exceptional circumstances (say after something like the Christchurch earthquake).

by HGWR | 3rd Nov 23, 1:16pm 1698970581

Low interest rates without change to tax or immigration settings is what we tried from 2015-2020, during which time inequality widened, rents and house prices grew considerably. Why would we expect it to have any other effect if we tried again?

I'm also not very convinced by your inflationary loop - you've conveniently ignored the inverse relationship between rental demand/supply and other demand/supply. If food prices go up, people have less to spend on rent, and vice versa.

by Jonny.Foe | 3rd Nov 23, 11:18pm 1699006739

Rents grew at almost exactly the same rate as income between 2015 and 2020. And if you think food prices go up and down with demand, I've got a harbour bridge to sell you.

by Small Kev | 3rd Nov 23, 11:44am 1698965048

The Labour Party gave landlords a 'gentle nudge' to start reviewing rents annually. Some landlords have been playing the 'generosity' card, only bothering to adjust rents with each new tenant.

by K.W. | 3rd Nov 23, 1:07pm 1698970055

And the Greens threat to impose rent control saw landlords quickly bump up their rents to market rent before the election, before they were permanently trapped with low rents.

by Flying high | 3rd Nov 23, 9:52pm 1699001530

Precisely

by Jonny.Foe | 3rd Nov 23, 11:19pm 1699006785

That is some Mr Tickle arms length reaching right there!!!

by timbob | 3rd Nov 23, 11:46am 1698965175

Rent increases are factored into the CPI. I think inflation is here to stay. HFL !

by ikimpaul | 3rd Nov 23, 12:23pm 1698967433

A couple of things

1. Queenstown is determined to kill its golden goose

2. Interesting Lower Hutt rents have dropped - the data I've been collecting on lower hutt shows in 2021 the number of rentals on the market ranged from 90-110 per week, this shot up to 260 the week of the 28th Nov 2022 as a large number of townhouses were built and completed in the region in 21/22.

This year the average number of rentals has been 177 per week- although this week there are only 130 rentals available and there has been a decline in the number of rentals in recent months.

What this is indicating is the more supply the lower the rental price increases, Queenstown may want to take note.

by Jonny.Foe | 3rd Nov 23, 11:20pm 1699006824

It's jobs and wages - the areas where rents have gone up have seen decent jobs / wages growth.

by HouseMouse | 3rd Nov 23, 12:22pm 1698967325

Apologies a bit off topic, but this mortgagee sale of a new apartment block is yet another sign of what is on the way:

https://www.nzherald.co.nz/business/china-construction-bank-nz-calls-fo…

by kiwi_overseas | 3rd Nov 23, 12:27pm 1698967628

ABSURD.

massive immigration furling the fire

by HouseMouse | 3rd Nov 23, 12:38pm 1698968298

Yes indeed.

However I have little doubt that immigration will slow massively in 2024.

by Nifty1 | 3rd Nov 23, 12:43pm 1698968600

Why will immigration slow down massively in 2024?

by HouseMouse | 3rd Nov 23, 12:50pm 1698969009

Because the labour market will tighten significantly.

A number of people on work visas in construction will also need to leave, affecting the net migration numbers.

by timbob | 3rd Nov 23, 1:18pm 1698970722

I thought construction had already fallen off a cliff, which would there be hundreds of construction workers be being hired at this point in the business cycle? Does anyone think that the jump in demand for housing, and house sale prices increasing by 10% in the last month is a knee jerk reaction by the market to possible higher rents and mass migration stories, and spruiking the RE market ?

by HouseMouse | 3rd Nov 23, 1:23pm 1698971000

Consents have slumped but construction has still been strong as many projects started in early to Mid 2022. Many projects are being completed this year, and far fewer will start next year.

by 1689 Baptist | 3rd Nov 23, 3:10pm 1698977422

So immigration will slow. But there won't be net emigration in your hypothesis. Only net emigration will bring downward pressure on rents. We are simply postulating on the speed of the trajectory, not the direction.

by HGWR | 3rd Nov 23, 1:04pm 1698969853

One reason - in the last year we've added close to 30,000 working holiday visas whilst only a few thousand have expired. Next year, we'll probably add 30,000 more WHVs, but the 30,000 from this year will expire at the same time. So net migration of WHV holders will go from roughly +20,000 to 0.

There will be a similar albeit weaker effect seen across other visa types.

by K.W. | 3rd Nov 23, 1:11pm 1698970260

Except that a lot of those WHV will simply convert to standard Work Visas, as their employers take advantage of the rubber stamping to become Accredited Employers and be able to hire anyone they like.

by HouseMouse | 3rd Nov 23, 1:11pm 1698970266

Yep exactly

by Squishy | 3rd Nov 23, 1:19pm 1698970798

When the economy has more jobs than houses you've probably devalued labor too much comparatively.

by K.W. | 3rd Nov 23, 1:22pm 1698970966

In exciting news for investors, the net inflow of people into NZ hit almost 80,000 for the month of October. The days of NZ losing population seems to be over, thanks to Labour's open door rubber stamping immigration policies. Sadly none of them seem to be doctors or nurses, but you should be able to get an Uber pretty quickly these days. Brace for an Australian style rental crisis. Get popcorn.

by timbob | 3rd Nov 23, 3:10pm 1698977440

The estimated net migration curve is going exponential. I see your point. Rents are going to skyrocket.

by 1689 Baptist | 3rd Nov 23, 3:16pm 1698977766

Exactly, small talk policies such as interest deductability are simply blowing in the wind. large net immigration means demand goes up while supply stays the same.

by wingman | 3rd Nov 23, 4:29pm 1698982147

So much for the moronic Labour legislation removing tax deductibility on mortgage interest.

by Chaosinflesh | 3rd Nov 23, 9:42pm 1699000977

thought you did new builds, so why would you care?

by Nzdan | 4th Nov 23, 7:42am 1699036964

Might be a little stretching of the truth to bolster their online ego.