Renters can expect to drive harder bargains in the coming months as more and more properties are coming on the market, thanks in part to a slowdown in the buying and selling space.
“There’s a 30 per cent increase in the rental stock,” says Nathan Miglani of NZ Mortgages, which has helped hundreds of Kiwi-Indian clients across Auckland, Wellington and Christchurch among other towns and cities.
“What this means is rental prices are most likely not going up in the next one year. If anything, they might come down even if only a wee bit,” Nathan says.
It wasn’t so much of a renter’s market till as recently as three months back, say industry insiders. Rishabh Kapoor, CEO of property management firm Impressions Real Estate, says demand has slowed down while the availability of stock has increased in the last few months.
“Although a lot of different factors have to be considered, such as location, type and size of the properties, what we have seen in our books is that vacancy rate has climbed to 3.02 per cent from two per cent in the last month. So rents are also getting competitive. No one wants an empty property,” says Rishabh, whose company manages at least 1,000 rental properties in Auckland.
In June, New Zealand's housing values declined for the second consecutive month, according to Quotable Value (QV). The national average dwelling value saw a significant drop, particularly in the Auckland region, which experienced the largest decline.
QV's report attributes the decline to harsh economic conditions, affecting the housing market across most main centres. High interest rates and persistent inflation are making it difficult for potential buyers to save for a deposit, secure financing, and service mortgages. As a result, market activity has slowed, with investors, owner-occupiers, and first-home buyers all stepping back.
But Rishabh points to what he says is a problem much bigger than just seasonal market swings. “We need more people in the market…students, migrants, etc. Otherwise we will just be moving the existing people around and there is a limit to that.
“Early in the year a lot of people moved to Auckland from different parts of the country. I don’t think that’s the trend anymore, especially with all the job cuts.”
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