Rental Prices Surge In Otago

Otago rental prices left other regions in the dust in December, with a +4.2 per cent month-on-month increase, outpacing the 14 other regions Trade Me Property monitors.

This follows a substantial +11.6 per cent year-on-year increase, significantly outpacing the next highest region, Southland which was up +6.8 per cent.

While prices for the Otago region have increased, supply is down with listings on site falling by -19 per cent between November and December, compared to a drop of -13 per cent nationally.

Trade Me Property's Customer Director, Gavin Lloyd notes the month-on-month drop in rental listings is a consistent seasonal trend, for both the Otago region and rental listings across the motu.

“This downturn can largely be attributed to the Christmas break, a time when prospective renters may hold off on their search until after the summer holiday,” says Mr Lloyd.

“Looking at Otago, the larger drop in supply could be due to a few factors including the cadence of university students sourcing rental accommodation in Dunedin, as well as increasing property costs which could force landlords to sell or increase the rent they charge tenants.”

Modest shifts in rental prices elsewhere

December saw minor fluctuations in rental prices across the rest of Aotearoa.

Auckland and the Bay of Plenty continue to mirror each other with both recording decreases of -1.5 per cent during December. The median weekly rent for the Bay of Plenty comes in at $665 while Auckland is $5 behind at $660.

Weekly rents in Wellington held firm at $650, while Marlborough and Manawatu also saw no change from November.

Other notable mentions include Hawkes Bay with a +3.2% increase from November ($650), while Northland recorded a +1.7% increase, bringing the median weekly rent to $590.

Highest listings on site, a spotlight on the Top Three

Marlborough leads the way with a +93 per cent year-on-year rise in listings on Trade Me Property. Renowned for its wineries and scenic bike trails, the combination of attractive amenities and a high number of listings suggests underlying factors.

“The relatively affordable median weekly rent of $550 (unchanged between November and December) might attract tenants, and while the slower pace of life may appeal to some, others may struggle for job opportunities in a primarily agricultural region,” says Mr Lloyd.

Hawke's Bay follows closely behind with an +83 per cent increase. Its stunning views and award-winning architecture are undeniable draws, yet the market shows signs of potential overheating.

“The +3.2 per cent rise in median weekly rent to $650 in December indicates increasing demand, but the sheer volume of listings shows demand is some way behind current supply in the region.”

The West Coast comes in at third-place with a +72 per cent rise in listings.

Decreased Demand for Larger Rental Properties

Median weekly rents for properties with five or more bedrooms fell significantly this month. Wellington and Auckland experienced the steepest declines, each dropping 8.7 per cent to $1,200 and $1,050, respectively.

In contrast, median weekly rents for three-and four-bedroom properties remained largely unchanged, while smaller rental properties with 1-2 bedrooms saw a slight decrease. Christchurch dropped -1 per cent in the median weekly rent to $495, Wellington -1.8 per cent to $560 and Auckland -1.7 per cent to $570.

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