Trade Me Property says Christchurch has become a tenant's market with rents declining for 15 months in a row

Trade Me Property says Christchurch has become a tenant's market with rents declining for 15 months in a row

The median asking rents for homes advertised for rent on Trade Me Property have barely changed in Auckland over the last 12 months, but have fallen significantly in Christchurch.

Trade Me Property said the average asking rent for all homes throughout the country advertised on the website in July was $440 a week, up 4.8% compared to July last year.

In Auckland the average advertised rent was $510 a week in July, up just 3% compared to July last year, in Wellington it was $420 a week up 5% and in Christchurch it was $400, which was down 7% compared to a year earlier.

The figures also showed that advertised rents for smaller properties were rising at a greater rate than those for larger homes.

Across the country, the median advertised rents for apartments were up 7.3% in July compared to a year earlier, while the advertised rents for home units were up 7.6%, and advertised rents for 1-2 bedroom houses were up 6.1%.

But rents for 3-4 bedroom houses, which are still the most common type of rental property in this country, were up just 4.3% compared to a year earlier, and rents for homes with five or more bedrooms were up just 2.9%.

Asking rents were up in all regions of the country compared to a year earlier, except for Canterbury where they were down 7.1% , the West Coast  down 4.2%, and Taranaki which was unchanged compared to a year earlier.

The biggest increases occurred in Bay of Plenty +13.9%, Northland +11.1% and Waikato +8.8%.

Trade Me's Head of Property Nigel Jeffries said the number of rental properties becoming available was continuing to increase in Canterbury, particularly in Christchurch where the strong supply meant it had become a tenant's market, with median asking rents falling for 15 consecutive months, down from a peak of $495 a week to just $400 a week in July.

Median asking rents for homes advertised on Trade Me Property in July

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25 Comments

I'm calling it. Auckland is heading into an oversupply of rental properties and just has a shortage of houses to speculate on. How on earth will boomers cope with servicing empty "Investment" properties?

Hopefully by selling them at a loss and getting burnt like most of them probably deserve...

Or Govt. will sort them out and look after boomers like they usually do.

Here we go again, the "Chicken Licken Call" that the sky is falling. After seven years of calling it you guys must be getting tired of "crying wolf". Now I am getting my folk tales mixed up. Please, please stop "calling it" every 5 minutes... It's boring.

The boom to doom cycle is around 10 years or so... and just in case you haven't noticed house prices might be up ( at record levels along with income vs debt ratio's) but ...just about everything else is taking a hit because of the capital suction effect of all that debt binged investment going to just one UNPRODUCTIVE thing. Not just here but around the globe....again. A pay the piper day is not a case of if ...but when.

So continue sticking your head in the sand, others can see the forest for the trees.
What's boring is people who think 2008 was a non event where all the financial problems of the world were solved using bailouts, QE, and austerity packages. Nah.

Do you remember the end of the boy who cried wolf? Could be worth another read.

No shortage of tenants. Plenty of Chinese and Indians still to move over.

Hard to believe now but this will be Auckland's story in a few years also. Unless JK and co keep the immigration tap on full..

People have now realized Auckland rental yields are going sideways. But wait till they see what's coming under the Unitary Plan (decisions version) just approved. The scope for more household units is absolutely massive.

I know for a fact there are many investors already looking at creating units, terraced town houses, second dwellings, MHU's, etc. It seems unlikely Auckland rents will rise as a consequence.

The scope is larger, but the land cost is still too high. They can look all they like, it isn't going to make Auckland become more attractive to construction investment. All the people who have just been given the scope to develop will do the same sums that everybody did who had scope to develop pre-Unitary Plan (in the CBD) and come to the same conclusions. It is mostly still better to hold land as an investment, than to build in Auckland.

"The biggest increases occurred in Bay of Plenty +13.9%, Northland +11.1% and Waikato +8.8%."

Up another 12% in manawatu, more than 2 of the reported 3 'hotspots'. Still a screaming buy rating on Palmy property from me.

Small population, isolated from most of the major centres except for Wellington.... Long term outlook is not favourable, but a quick captial gain would be perfect.

Oh except wellington, the capital of the country, and about to get 30 min closer after transmission gully.

Central to over 1 mill population. Used as distribution hub for freight for that reason.

Biggest army base in nz.

Airforce base 20 min away.

Massey Uni's biggest campus. International student boom is fueling rents.

Agresearch capital of nz. FoodHQ , Frontera research base, and nearby processing plants.

Outlook extremely favourable. Predicted population growth similar to welly (around 20% gain to 2043). Compared to nill predicted growth in HB , rotorua, lower Hutt, almost every other secondary city except Hamilton and tauranga.

Christchurch's rental decline is driven by two aspects:

  • The sudden release of lotsa building-ready land onto the market, which end-ran the land-bankers and allows (still) new house/plot prices in the low $400K for a starter-kit house. This supply has kept both house prices and rents locked down. Lesson here for Awkland: supply-provision really does have economic effects. Whodathunk?
  • The early rents post-earthquake were skewed well oopards, by the re-homing of lotsa people under insurance-provided short-term rentals. It was nothing to get $1-2K per week for a house, because the insurance alternative was motels and hotels at $200 per night. This has decayed away to fairly much nothing, so the effect on average rents is quite marked. Christchurch is almost a 'normal' market now.

Checking TradeMe shows some 1938 properties for rent in Christchurch - last time I looked ( a month or so back) was around the 1800 mark - why the increase..... curious.

I have previously mentioned on this site that rents were declining in Christchurch......many tenants have had to shift as quite a few landlords wouldn't meet the market and lower the rent charged..........some houses have been remaining empty for a considerable period of time before new tenants can be found..........landlords who aren't meeting the market will be faced with a turnover in tenants and already their is considerably reluctance for tenants to tie themselves into agreements over 6 months...........

No comment from the MAN? I called this last month .....

Yes rents have come back a wee bit over the past year to 18 months.
The truth is though that if you have a well maintained property they are still easy enough to rent and there is
Still demand even in the middle of the year.
We have bought several in the past year and had no problem at all renting them and all positively geared.
Landlords are better off than a couple of years ago as the interest rates have come back by 20 per cent or so.

Are there current or historical stats out there for CHCH rental asking prices based on terms of one year or longer?

Yes there are stats available.
Landlords can wear rental drops due to the lower amount of interest being paid.
Many landlords also do not depend on income from rents as they also have a 9 to 5 jobs so from my experience often have rents lower than need be.
Landlords who are full time tend to be more professional and generally obtain more income.
Many landlords with only one or two properties aren't even aware of the necessity to be doing 3 monthly property checks and document everything.

The bigger news is that it is rents are starting to fall in Brisbane and Sydney and stabilising in Melbourne, whilst Auckland's continue to rise.

Our immigration figures are about to become a whole lot less of a "problem" as thousands of young Kiwis are going to be leaving.

No problem, we have plenty of Chinese and Indians to replace those who leave.

Rent up 3% even in winter time?!

The stats are annual rise, didn't matter what month the report is the full year is included.

There is still plenty of downside to come for Christchurch with people renting out there damaged homes having moved into the new house. Then there are all the as is where is houses being bought up, quick tidy and onto the rental market.
I worry that with no controls the city has become the new "wild west" with lots of damaged cashed out homes creating a situation which, could in the future, make the leaking homes problem look minor. Just saying :-)

Jono, not too sure what you mean by " the Wild West"

Any too badly damaged houses have been demolished.

Most of the "as is" homes are perfectly fine and totally liveable.
The fact is that they have stood up to over 15000 shakes.
They have all had thorough checks carried out and if there is any major problems the owners are not renting them out as they have been paid out.

Christchurch is going to be the destination of choice for liveable cities in Australasia in the next few years guaranteed.