Rents up $10 a week
Median residential rent levels across the country have risen by $10 a week over the last quarter to $290 a week, according to the latest report from the Massey University Real Estate Analysis Unit.
Wednesday, December 19th 2007, 3:00PM
by The Landlord
The report is based on data from the private rental sector supplied by the Department of Building and Housings bond centre.The national median rental level was up by 7.4% compared with November 2006 and on a quarterly basis the median rental level stayed ahead of inflation, increasing by 3.5% from August 2007.
The largest annual increases were 13.6% in Hastings, 11.5% in Christchurch, 10.2% in Whangarei and 10% in Rotorua. Increases in Auckland were more modest and in the range of 3 to 6%.
On a quarterly basis the largest increases were 11.5% in Lower Hutt, 8.7% in both Dunedin and Palmerston North and 8% in Whangarei. In the Auckland region rents were generally static with the exception of the inner city region where there was a 2.9% increase.
Increases in rents over the last quarter are likely to be partly the result of demand pressure from net migration and potential first home buyers who are remaining in the rental market for longer than expected, says Professor of Property Studies, Bob Hargreaves.
On an annual cash flow basis, excluding capital gains, renting is now typically less than half the cost of owning, Hargreaves says. This means when house prices are static or falling there is much less pressure on renters to buy, he says.
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