A lack of rental growth continues to be the predominant feature of the residential investment market at the moment, with the national median rent showing no improvement since the end of 2023.
The latest bond data from Tenancy Services, shows that the national median rent first hit $600 a week in December 2023 and has remained there ever since, apart from the months of January 2024 and 2025, when it briefly jumped to $608 and $620 respectively, before dropping back to $600 in February of both years.
Rents in the main centres are a bit more volatile, but overall they show similar trends to the national figures.
In Auckland, the country's largest rental market, the median rent has been stuck on $650 a week since July last year and in April this year was $10 a week lower than April last year - see the table below for the rental trends in all main centres.
While rents are largely flat, there has been an increase in the number of properties being newly tenanted.
In April this year, Tenancy Services received 11,826 tenancy bonds, up by 6.7% compared to April last year.
This supports anecdotal evidence from property managers that there is no shortage of properties to rent, particularly in Auckland, giving prospective tenants plenty of choice and keeping a lid on the rents landlords can charge.
However individual landlords who lose a tenant may need to reduce their asking rent to attract a new tenant thanks to what is called "value creep."
That's where a tenant takes advantage of a fall in rents by moving up to a better quality or more desirable property, but the rent they are paying remains the same.
This causes the rents received by landlords to fall while the rents being paid by tenants are unchanged.
This would explain why asking rents on property websites such as Trade Me Property appear to be falling, while bonds received by Tenancy Services are largely unchanged.
3 Comments
The business of landlording was capital growth. Rent did not matter so much.
And now ? What is going to happen now there is no business in it.
Developers trying to offload specu boxes with continuing no capital growth are becoming further and further under water. Clearly with no specu inflation extortion, how will it make sense....?
For once I mostly agree. I have just received notice for 4 bed x 2 living area @ $750 Pw. Will advertise at $700. Trade me numbers have just started retreating in Nelson but supply and demand are roughly matched. Some listing have been sitting for months but new ones come and go quickly.
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