Early 2016 got off to a busy start for landlords and renters, while average weekly rents edged up only slightly over the first few months of the year.
Barfoot & Thompson’s quarterly rental update covers data gathered over the first quarter of the year – January, February and March, from across more than 13,000 rental properties under the agency’s management.
“The year began swiftly with a notable increase in the number of properties rented across almost all areas of Auckland over all three months. Typical for this time of year activity peaked in February, but then remained steady in March – a month when things usually tapper off bit,” says Will Alexander, Property Management Business Development Manager for Barfoot & Thompson.
“For example in March the number of new tenancies was up 15% on 2015.”
Alongside the surge in activity during the quarter, weekly rental prices across all tenancies increased by just 1.4% when compared to last quarter of 2015 and by 5.3% when compared to the same period in 2015.
Looking at the latest figures from the month of March 2016 alone, rental property prices across Auckland were up 5.8% year-on-year. During this time the average weekly rent for one bedroom properties rose 4.8% (from $316 to $331), two bedroom by 6.3% (from $398 to $423), three bedroom by 5.6% (from $486 to $510), four bedroom by 5.1% (from $614 to $644) and five or more bedroom by 5.8% (from $755 to $791).
“The average weekly rent for a three bedroom property in Auckland – the property type we rent most – topped the $500 mark in October last year and has grown by a dollar or two each month since,” says Mr Alexander.
He highlights that while actual rental prices are also impacted by a property’s location and other factors, with those closer to the city demanding higher price points, the agency was observing significant percentage increases in outlying suburbs.
“Rodney and the Franklin and rural Manukau area continue to show the fastest growth in average weekly rental prices, with an 8.4% increase in Franklin and Manukau, and 7.8% increase in Rodney over the past 12 months.
“While these are typically some of the more affordable areas to rent in, comparative rental price increases are now significantly above the average. The prices in the Franklin and rural Manukau area are now getting closer to the averages currently seen in South Auckland.
“These increases suggest that Aucklanders are struggling to find suitable properties in closer suburbs, or are happy to travel further afield to find the right home at the right price.”
Looking ahead, Mr Alexander says demand for rental properties is set to stay strong.
“Based on past figures the next peaks in activity will likely be either side of mid-year, in May and again in August – traditionally our busiest period. This is something for renters to consider if they want to move but avoid those more competitive periods.”
Barfoot & Thompson knows Auckland best. It is the city’s leading real estate company, selling around one in three Auckland residential homes and managing more than 13,000 rental properties.