Big Demand for High-End Properties
By Joseph Aldridge | 12th February 2011
Whangarei's rental market is bursting at the seams.
Thousands more people are opting not to own their own homes because of the downturn in the property market and banks requiring bigger deposits for home loans.
Agents are reporting an increase of up to 25 per cent in the numbers of prospective tenants and homes are being let as soon as they are listed - with high-end rentals in high demand.
The growing size of the Whangarei rental market was evident in Department of Building and Housing figures which showed 64,849 bonds were lodged as of Wednesday - an increase of more than 3500 on the same time last year.
The department stressed that it only recorded tenancies where a bond was received, so the size of the rental property market in Whangarei was likely to be bigger than the numbers listed.
BNZ chief economist Tony Alexander said economic conditions - a flat property market and banks now requiring a 20 per cent deposit for loans - were holding both landlords and tenants in the rental market longer than they had planned, while at the same time drawing in additional people who might have otherwise bought a house.
"I do think more people are showing a preference for renting rather than buying," he said.
While some in the industry reported a stable market, others reported a massive increase in demand.
Local property managers said there was a shortage of rental properties in the high-end ($350+ a week) of the market, meaning such properties were snapped up quickly whenever they were listed.
The news follows a report in the New Zealand Herald that demand in the Auckland rental property market was at a crisis point.
Several rental companies confirmed a similar pattern had been happening in Whangarei in recent months, particularly among pricier properties.
Barfoot and Thompson rental operations manager Helen Hodgson said the Whangarei branch was receiving a steady stream of inquiries from people wanting four-bedroom family homes.
"They're letting them as fast as they can list them."
The rental manager was taking three or four people at a time to see newly listed properties, she said.
Ms Hodgson said January was always the busiest month of the year as people moved from overseas or other New Zealand cities to take up new jobs. It usually stays busy through the summer months, although the heat will go out of the market after that."
Of the 305 houses listed for rent in Whangarei on Trade Me yesterday, only 23.9 per cent (73) were listed in the high end of the market and only 15.7 per cent 4 had four bedrooms.
Just Rentals director Paul Hansen said there were a lot of reasons for the increased demand in the rental market.
"We find that with a lot of people who are coming back to the town from other areas, they are holding off [from buying] and looking around because they can, because the market is fairly flat."
Mr Hansen said his business had seen a 25 per cent increase in the number of prospective tenants in recent months.
Jackie Ogle, who owns five high-end rental properties in Whangarei with her partner, said her properties were normally filled very quickly, usually taken by the first or second person to look at them.
Properties that were not well looked after by their landlords deteriorated in value and were harder to fill, she said.
"It's well known that tenants do not look after properties and you need to keep a tight rein on it."
Ms Ogle said many landlords didn't know how to look after their rentals, and some property managers were not much better.
By Joseph Aldridge | 12th February 2011
Whangarei's rental market is bursting at the seams.
Thousands more people are opting not to own their own homes because of the downturn in the property market and banks requiring bigger deposits for home loans.
Agents are reporting an increase of up to 25 per cent in the numbers of prospective tenants and homes are being let as soon as they are listed - with high-end rentals in high demand.
The growing size of the Whangarei rental market was evident in Department of Building and Housing figures which showed 64,849 bonds were lodged as of Wednesday - an increase of more than 3500 on the same time last year.
The department stressed that it only recorded tenancies where a bond was received, so the size of the rental property market in Whangarei was likely to be bigger than the numbers listed.
BNZ chief economist Tony Alexander said economic conditions - a flat property market and banks now requiring a 20 per cent deposit for loans - were holding both landlords and tenants in the rental market longer than they had planned, while at the same time drawing in additional people who might have otherwise bought a house.
"I do think more people are showing a preference for renting rather than buying," he said.
While some in the industry reported a stable market, others reported a massive increase in demand.
Local property managers said there was a shortage of rental properties in the high-end ($350+ a week) of the market, meaning such properties were snapped up quickly whenever they were listed.
The news follows a report in the New Zealand Herald that demand in the Auckland rental property market was at a crisis point.
Several rental companies confirmed a similar pattern had been happening in Whangarei in recent months, particularly among pricier properties.
Barfoot and Thompson rental operations manager Helen Hodgson said the Whangarei branch was receiving a steady stream of inquiries from people wanting four-bedroom family homes.
"They're letting them as fast as they can list them."
The rental manager was taking three or four people at a time to see newly listed properties, she said.
Ms Hodgson said January was always the busiest month of the year as people moved from overseas or other New Zealand cities to take up new jobs. It usually stays busy through the summer months, although the heat will go out of the market after that."
Of the 305 houses listed for rent in Whangarei on Trade Me yesterday, only 23.9 per cent (73) were listed in the high end of the market and only 15.7 per cent 4 had four bedrooms.
Just Rentals director Paul Hansen said there were a lot of reasons for the increased demand in the rental market.
"We find that with a lot of people who are coming back to the town from other areas, they are holding off [from buying] and looking around because they can, because the market is fairly flat."
Mr Hansen said his business had seen a 25 per cent increase in the number of prospective tenants in recent months.
Jackie Ogle, who owns five high-end rental properties in Whangarei with her partner, said her properties were normally filled very quickly, usually taken by the first or second person to look at them.
Properties that were not well looked after by their landlords deteriorated in value and were harder to fill, she said.
"It's well known that tenants do not look after properties and you need to keep a tight rein on it."
Ms Ogle said many landlords didn't know how to look after their rentals, and some property managers were not much better.
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