Smaller homes in Auckland are enjoying the biggest rental growth, new figures from Barfoot and Thompson shows.
Pressure on rental prices eased across the city in the three months to September 2019 but there were pockets of growth, especially in the CBD, South Auckland and Franklin.
Barfoot and Thompson's figures, gathered from more than 17,000 properties in Auckland, showed that smaller Auckland homes attracted higher weekly rents compared to other parts of the market.
Barfoot and Thompson director Kiri Barfoot says: “The average weekly rent across all properties was $579, up 2.95 percent at the end of September when compared to the same time last year, or around $16 more per week.
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“However, there are some property types and locations that are bucking the trend. Most notable are the smaller properties, with weekly rents for two-bedroom homes growing by 4.06 percent year on year."
Rents in Central Auckland homes saw the biggest year on year growth, at 6.15 percent. Franklin and Manukau enjoyed the next biggest lifts in weekly rent, growing year on year 4.41 percent. Price growth was lowest in Rodney and the Eastern Suburbs.
The price growth in the two-bedroom sector of the market is particularly stark when compared to larger homes, which were seeing the opposite, Barfoot says.
“On average, weekly rents for homes with four or more bedrooms are hovering around one per cent higher year on year, and some will have seen flat or declining prices during the year.”
One-bed apartments in Central Auckland hit $416 a week, and $616 for two beds and $1,095 for three-beds.
Barfoot says although there has been some softening of rental yields, they remain attractive when compared to many other investment opportunities, particularly bank interest rates.
Barfoot and Thompson's figures predictions of major lifts in New Zealand's house prices from Westpac economists. Westpac has tipped house price growth to quicken in 2020, and have made forecasts of rises of up to 7 per cent.
