National rental pressures on landlords and renters are impacting New Zealand’s provincial areas, but the local squeeze is reportedly not as grim as in other regions.
Managing director and auctioneer for Harcourts Wairarapa Prue Hamill said that when it came to the region’s rental market following suit, she wasn’t worried.
“We’re seeing a steady flow, so that’s really good.”
Citing an observed increase in rental prices, Hamill said this didn’t appear to be impacting the local market too drastically.
Hamill said that instead of gravitating towards AirBnB rentals, people were starting to return to the rental market.
“As long as we’re doing a steady flow, and letting some rentals out and getting more in, we’re quite happy.”
Property Brokers general manager David Faulkner said the national shortage partly reflected the impact of a rise in tenants and upheld tenancy regulations.
“The tenancy law isn’t a bad thing, I’ve got to stress. It’s a good thing,” Faulkner said.
“But what happens is, your landlords are becoming pickier about who is going into their property. If you’ve got poor credit or a bit of history, it can be very hard to find a rental property.”
Faulkner said rental rates have increased in provincial areas much quicker than larger cities like Wellington or Auckland, due to multiple reasons.
“People have moved out of cities and prefer the provinces after covid, the pressure’s been put on landlords which has made it harder on costs, inflation with high-interest rates,” Faulkner said.
“There are lots of moving parts.”
Although not involved in the rental market on a day-to-day basis, Real Estate Brands regional manager Rob Slater said he was aware of the difficulty today’s landlords were facing with rules and regulations.
“Landlords that I deal with are generally struggling with the increased cost of compliance, increasing interest rates and the ability to cover their costs from rent they receive.
As a result, Slater said he was continuing to see landlords sell off underperforming rental properties across Wairarapa.
“This will only be adding to the problems tenants are currently experiencing.”
According to Infometrics, Masterton’s average rent is at $471 per week, up 24 per cent in the past two years.
Close on its heels is Carterton at $463, the past two years showing a rise of 22.8 per cent.
There is no available data on South Wairarapa through Infometrics.
LJ Hooker Property Investment Manager Keith Archer confirmed that locally, he had observed the number of rentals decreasing and rent prices leaping in the other direction.
Describing the market as interesting, Archer said the previous trend of lower inquiries leading up to now was also concerning.
“From October to April this year, we had quite minimal enquiry numbers for any property. It was quite a worrying trend, and we were really struggling to find tenants.
But recently, Archer said things were looking quite different.
“Since then we’ve actually seen a huge increase in demand,” Archer said.
“Largely fuelled by folks from out of town coming here.”
Archer said part of the reason for this was higher immigration numbers and a boom in business.
Touching on Hamill’s note about increasing AirBnB, Archer said this wasn’t something he was particularly concerned about.
“There aren’t that many properties AirBnB’d around here. Even in the sales office, we do see a few going there but not a lot,” Archer said.
“You’ve got increased costs with AirBnBs, it’s quite labour-intensive.”
Archer pointed to other players impacting the market, including young professionals chasing other dreams across the ocean.
“We’re also seeing a lot of young people throwing their hands in the air and wondering, what they are doing here.” Archer said.
“The weather’s rubbish, the wages are rubbish, I’m going to Australia.”
While this was good in terms of bringing new rental listings, Archer said it was sad to see people leaving.
