Major cities drive drop in rental listings

Major cities drive drop in rental listings

National rental supply is down 7% on a year ago, driven by significant drops in the number of properties listed in Auckland, Wellington and Christchurch according to Trade Me Property’s analysis of the September quarter.

Brendon Skipper, head of Trade Me Property, said the fall in the number of properties listed for rent had been led by major metropolitan areas with Auckland (down 13%), Christchurch (down 27%) and Wellington (down 30%).

“As the rental market tightens, tenants can expect to be competing against plenty of other prospective tenants for rental homes,” Mr Skipper said. “We’ve already seen this start to occur, with the number of enquiries sent to landlords via the site up 10% nationwide on a year ago, and spiking more than 20% in Manukau, Wellington and Christchurch.”

He said one factor that had emerged over the quarter, alongside the decline in rental properties, was a rise in homes listed for sale. “Homes listed for sale are up 14% on the same period a year ago. It’s a bit early to get carried away so we will be watching to see if a trend develops, but we could be seeing the impact of Government tax changes or confidence in the for sale market starting to return.”

In Auckland supply remains tight with a 13% drop in listings, a consistent trend in the area for 6 months. The number of enquiries per listing has increased by 10%, with a similar increase in prices. This is likely to ease as we head into summer and World Cup fever subsides. It’s a similar story on the North Shore where listings dropped by 12%. Rental asking prices have risen by 7%. Demand has also increased by 7% (after a 2% decline last quarter).

In Christchurch listings took another hit and demand levels increased by 27%. Although it has obviously become a hard place to find a home, there are no signs of landlords taking advantage of the situation – asking rents have only increased by 6%, in line with the national average.

Wellington’s 30% listings drop was the largest decline of any of the major centres. Enquiries from prospective tenants leapt 23%, and so far asking rents have remained relatively flat but look set to come under pressure over coming months.

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