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Wellington is the first region in the country to cross the average weekly rental milestone of $ 600, with a record high of $ 615 per week in January, according to the latest Trade Me rental price index.
It saw the capital overtake Auckland, which hit an all-time high of $ 590 last month.
While rents were on the rise in the Wellington region, the Porirua district remained the most expensive, with a median weekly rent of $ 680, compared to $ 640 in Wellington City and $ 590 in Lower Hutt.
Are you affected by record rental prices in the capital? Contact [email protected]
Ross Giblin / Stuff
Wellington is now the most expensive city to rent, crossing the $ 600 weekly median rent barrier. (File photo)
Homes with three or four bedrooms cost $ 700 a week to rent on average in Wellington, while a smaller one- to two-bedroom property would cost renters around $ 530 a week.
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Trade Me property sales director Gavin Lloyd attributed the problem to a lack of supply.
While Wellington’s rental market was typically under pressure in January and February, as many leases were up for renewal and higher education students began looking for new flats, this year it seemed even more difficult to find a rental property. usual.
“In January, the number of rentals on the market was down 3 percent compared to the previous year,” Lloyd said.
NICHOLAS BOYACK / THINGS
Median home price in Lower Hutt is $ 657,100 and weekly rent has skyrocketed to $ 590 per week. (file photo)
The region was countering a national trend, as across the country the number of rentals on the market had increased by 4%.
“As property prices continue to grow, we see more investors buying properties across the country and putting them up for rent,” said Lloyd.
“If supply continues to outpace demand, we would expect prices to cool down as we approach winter, which will be a huge relief to tenants after a difficult couple of years of rent increases.”
The most popular rental property in Wellington on Trade Me was a three-bedroom townhouse in Kelburn, which received 132 inquiries in the first two days after being listed.
Kevin Stent / Stuff
Porirua remains the most expensive city in the country to rent, averaging $ 680 per week. (file photo)
Wellington City Councilwoman Tamatha Paul said these increases were a symptom of a spiraling housing crisis and that Wellington would lose its cultural identity unless local and central government intervened.
“I’ve always said that people live here despite the houses,” he said.
“Whether it’s the artists who contribute to Wellington being the capital of arts and culture, whether it’s its students, or the working-class people who serve our city. The horrible housing and rental market is what really holds Wellington back in all areas. “
Paul said the changes to the rental laws in the Residential Leasing Act of 1986, the second phase of which went into effect today, were a good start. But the amount of rent increases needed to be limited to make renting an affordable option for people.
“What we see are owners who increase the rental price, but do not make material changes to their houses. That really must end. “
Renters United spokesperson Geordie Rogers said there should be a cap on the prices that could be set for rent.
“There really is no way to control at what price a landlord can set the rent, except the market rate, which is already well above what it should be. We would like to see rents set for inflation or for landlords to justify rent increases to the Rental Court. “
Rogers used the example of a tenant who feared a rent increase because the landlord was painting the house.
“What really surprised me was that the person didn’t say ‘I’m going to have to look for another flat,’ they said ‘I’m going to have to look for another job.’ People are considering moving from Wellington because it is easier to find a job elsewhere than it is to find a place to live. “
Lloyd said high house prices were exacerbating the rental market contraction.
“The median sale price of a property in Wellington has risen considerably in the last year. This keeps first-time home buyers in their rental property longer, while saving for a house deposit. “
Westpac chief economist Dominick Stephens said a factor behind the rent increases in Wellington was proximity to the government.
“The government is pouring a lot of money into the economy and Wellington sees more than its fair share,” he said. “It’s another example that the economy has weathered the impact of Covid surprisingly well.”
Stephens expected rental price growth to slow “over time, perhaps over the next year” due to low population growth and strong construction activity.
Rogers said any slowdown in rental growth would not fix the problem.
“It is important to realize that rent is not just a commodity. Because we are talking about a place where people live, they are willing to shell out an extreme amount of money just to have some security. I think we will see that the owners will continue to take advantage. “
Supplied
A four-bedroom apartment was recently listed on Marion Street in Wellington seeking new tenants for rent of $ 815 per week.
Overall national median weekly rent increased 5 percent in January compared to the previous year, hitting a new high of $ 540 per week.
The largest percentage increases were seen in Manawatū / Whanganui (17 percent), Marlborough (13 percent) and Northland (11 percent), where average weekly rents reached an all-time high.
Auckland ($ 590), Bay of Plenty ($ 550) and Nelson / Tasman ($ 500) also saw median weekly rentals hit all-time highs.
In the city of candles, the North Shore district was the most expensive, with an average weekly rent of $ 630. Auckland City was the most affordable, averaging $ 575 per week.
