Auckland, the largest city in New Zealand, is vibrant and diverse, a place where nature and urban life go hand-in- hand. With a population of over 1.6 million people, the city has a high demand for rental housing. However, recent data shows that rental housing costs and availability are becoming increasingly challenging.
In this blog article, we will discuss three insights into rental housing costs and availability in Auckland based on current data on weekly rental prices and listings.
Insight 1: Rental Housing Costs are Increasing
According to Trade Me Property, the average weekly rental price for a three-bedroom house in Auckland in April 2023 was $730. That is an increase of 6.7% compared to the same period last year, while the average for a two-bedroom house has increased by 5.4% to $590.
Further figures released this week by Tenancy Services show the upper quartile figure for a 4 bedroom house in the suburb of Remuera as $1250.
Although these figures can be helpful to a certain degree, our team of Mobile Advisors are reporting that rental prices are even higher than reported.
One example shared by a Mobile Advisor is that of a family of 6 who have recently arrived in Auckland. Ideally wanting a 4+ bedroom in Remuera, close to the children's schools, they have had to double their initial budget just to secure temporary accommodation. Our Advisor is now working with them to source long term accommodation but they are needing to reassess their overall housing budget, as well as the area of Auckland they were hoping to live, due to the lack of affordable, centrally located homes that would be suitable.
And it would appear that this is playing out throughout the country with increases across all price points in Auckland,Wellington and Christchurch.
So why the increase? It is a combination of factors including - population growth, limited new housing supply and increased demand.
Insight 2: Demand for Rental Housing is High
Trade Me Property reported that the number of inquiries for rental properties in Auckland has increased by 20% compared to the same period last year.
The high demand is partly due to the high cost of purchasing property in Auckland but also due to Auckland's population growth. The post Covid influx of international students and migrants looking for housing has put even greater pressure on an already tight rental market.
Also impacting the demand is the recent weather events, particularly in Auckland, which have forced people out of their homes and into temporary housing situations.
This has created a surge in demand for furnished rental properties but these properties represent a very small part of Auckland’s market with less than 2% of available properties being fully furnished.
Insight 3: Rental Housing Supply is Limited
Although there is high demand for rental housing, the supply of available properties, particularly in Auckland, is limited. According to Trade Me Property, the number of rental listings in Auckland in April 2023 was 8% lower than the same period last year. This means that potential tenants have fewer rental options to choose from, which further drives up rental prices.
Our Advisors are reporting that some property viewings are booked out as the demand is so high to even see properties. It is not uncommon for there to be up to 100 applications submitted for a property.
Impacting the supply of available properties is the increase in tourism in NZ. In Auckland. For example, owners of CBD apartments are choosing to list them on platforms such as Airbnb for a higher, short-term return which removes that property from the long-term rental pool.
In conclusion, rental housing costs and availability in Auckland are becoming increasingly challenging. The high demand for rental properties, limited housing supply, and population growth are driving up rental prices.
To find affordable rental housing, potential tenants may need to consider alternative suburbs or property types and be flexible in terms of their ‘must-haves’.
They also need to be prepared to act quickly and ensure they can provide all the necessary and required information to assist their application including correctly completed documents, personal references, and information about pets.
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If you are a recruiter or HR Professional bringing international talent to NZ Mobile Relocation has a range of settlement support services to suit your candidates and your business - from baseline support to meet Immigration New Zealand’s AEWV Accreditation requirements through to personalised programmes to support your most valued international employees.
To book a demo of our AEWV Resettlement Portal, or to better understand how Mobile can help you to ensure you are offering the right resettlement services for your candidates and your business, contact our Principal Bridget Romanes.
Bridget is a New Zealander who has lived and worked as a diplomat in Singapore and India. After experiencing all facets of the relocation experience, she founded Mobile to work with private individuals moving to NZ and leading local and international businesses bringing in offshore talent.