7 Feb 2011

Rental demand outstripping supply in Auckland

8:15 pm on 7 February 2011

The demand for rental properties is outstripping supply in Auckland, with prices also climbing.

Rental agents say January has always been a busy month, but this year there are even fewer homes to go round.

Barfoot and Thompson rental operations manager Helen Hodgson says

the shortage is throughout the region.

Ms Hodgson says sometimes people will offer more rent than what is being asked to ensure they get the property.

Rentals have also increased. The average letting fee, based on rents, has risen from $401 to $416, she says.

Goode Rentals says there are not enough stand-alone three-bedroom houses in suburbs surrounding the central business district.

Manager Darryl Goode says his inbox is full within hours of advertising a property, with 20 groups of people desperate to find a place to live going through it in one day.

Mr Goode says prices are also increasing between $10 to $50 a week, with weekly rent between $550 to $1000 in the suburbs of Mt Eden, Epsom and Ponsonby.

Tax changes blamed

The Property Investors' Federation says tax changes on 1 April are partly to blame for the shortage of rental properties in Auckland.

Federation vice-president Andrew King says a survey of its members shows while only 8% planned to sell property because of the tax increase, about 30% who were going to buy rental property in the future had changed their minds.