Santa brings an early Xmas present to tenants as residential rents decline and rental property supply increases
Residential rents are slowly declining while the number of rental properties being tenanted is increasing, according to the latest bond data from Tenancy Services.
The national median rent was $590 a week in October this year. That’s down from $600 a week in October last year, with median rents declining in six regions, remaining unchanged in four and increasing in six compared to a year earlier. (See the table below).
Overall, the figures show there has been little, if any rental growth for about the last two years, with median rents declining slightly over the last 12 months.
Conversely, there have been substantial increases in the number of properties being rented over that period.
Across the whole of New Zealand, 13,368 bonds were received for properties tenanted in October this year, up 21% compared to October last year.
On an annual basis, the number of properties tenanted in the 12 months to October this year was up 7.6% compared to the previous 12 months. (See the graph below for the monthly trend).
The figures also reflect data from property websites such as Realestate.co.nz, which show the number of properties being advertised for rent increasing while their advertised asking rents are declining.
All of these figures point to the same thing – a significant increase in the supply of properties to rent which is pushing down the rents landlords are able to charge.
However, the biggest test for the rental market is yet to come, with the period from December to February usually being the busiest months for tenants and landlords.
But so far, it looks as if the rental pendulum is swinging firmly in tenants’ favour.
