9 Mar 2021

Skyrocketing provincial rental housing, demand outstrips supply

From Nine To Noon, 9:08 am on 9 March 2021

Rental shortages in some of the country's regions are being described as dire by property managers.

No caption

Photo: 123rf.com

The demand for provincial rental housing is skyrocketing amid a perfect storm ensuring demand far outstrips supply.

There has been recent publicity about the dire availability of properties-to-let in Tauranga, Queenstown and the Nelson region, but it is much more widespread than that.

Bayley's Marlborough general manager David Lee told Nine to Noon host Kathryn Ryan rental property stock levels were at an all time low, creating a highly competitive market for those seeking a home to rent.

He said rents were increasing week on week in the region, rising around $20 a week, with multiple applications rolling in for every property available.

"A great example... there's a three bedroom, one bathroom property here in Blenheim, $520 a week, then moving up by... and additional bathroom you're looking at $610 a week."

Lee said the drivers for the shortage were good job opportunities in the region, Covid-19, ultrafast broadband availability and the fact that 'mum and dad' investors had been scared off property investing by government legislation.

He said that pushed the average price of a rental in Marlborough to about $500 a week.

"I think we really need to think about different housing options," he said.

"Traditionally in regional New Zealand we still have the beauty of a quarter acre section and one property on that section, I really think we probably need to look at higher density housing to be able to accommodate more people in a smaller land area."

Lee said his advice to those wanting to secure a rental property in the regions would be to make sure they had excellent references, save some money to show prospective landlords that they couldcover the cost of rent if they hit hard times financially, networking and pre-registering with all the rental agencies in the region.

Bay of Islands property management owner Liz Ford shared Lee's sentiments.

She said the demand for rentals in Kerikeri had been "astronomical", citing one listing that received over 1000 hits and 40 enquiries within 24 hours of posting it online.

Ford said her company had to set up an automated response service because demand was so high.

"For some [rental seekers] it's very dire, I've had a few people come into the office since Christmas to say they've been living in their cars, in both those cases they had relocated from Australia due to Covid-19 issues and coming home for support but then finding they can't find anywhere to live. 

"A lot of very, very stressed families, and the minute that a family is given notice that they need to leave their rental property they are basically in panic mode and looking for another one."

She said rental prices has gone up about 10 percent in the past 12 months in Kerikeri at an average cost of $500 a week.