Barfoot & Thompson said on Wednesday the cost of renting a home in Auckland was rising at the slowest pace in years.
The real estate agency manages nearly 16,000 rental properties and said its quarterly review of weekly rent prices showed the downward trend in the first 2 quarters of 2018 followed a period of steady rises of about 4.3%/quarter throughout 2017, compared to the same quarter a year earlier, and increases of 5% or more during 2015 & 2016.
Director Kiri Barfoot said over 6000 of the rentals the company manages have 3 bedrooms, and it uses them as a standard example: “Renting a typical 3-bedroom home in Auckland between April & June this year cost 3.5% or $19 more/week than it did during the same period in 2017.
“This is the smallest percentage increase in weekly rents that we have observed in at least the last 2 years and is also the first time the average increase has dropped below the $20/week mark.
“This time last year, the average increase in weekly rent on a 3-bedroom home was more like $22, and in 2016 it was as high as $24.
“We are likely seeing the beginning of a ‘new normal’ in rental price trends as landlords strike a fine balance in their pricing in the face of rising operating & compliance costs.”
The average weekly rent for all property sizes is edging downwards in keeping with the three-bedroom example, up 4.0% on the same period last year to $559. This compares to recent year-on-year quarterly increases of between 4.4% and 4.8%.
One-bedroom properties bucked the trend, with continued pressure on weekly rents pushing the June quarter increase up 4.6% over the June 2017 quarter. Properties of other sizes moved in a band between 3.4% & 3.9%.
West Auckland was the only where rent rises exceeded 5%, which Ms Barfoot said reflected the growing popularity of the area among renters.
Average weekly rent, change from Q2 2017 to Q2 2018:
Attribution: Barfoot & Thompson release.