Tenants are being forced to join long queues to view properties they then miss out on and many are being brought to tears over the massive shortage of rental properties in Christchurch.
People trying to get a three or four-bedroom home in a decent condition are finding themselves up against a huge amount of competition and many are having to submit numerous tenancy applications before finally getting a roof over their heads.
The number of properties available in Christchurch has dropped significantly over the past few years with the current stock levels of around 600 properties back to the number available post-earthquake.
In February 2021, there were 2105 properties for rent, which plunged significantly to 1409 in 2022, and by February this year stock levels had more than halved to 610. In the past two months, that number has risen slightly and there are now 690 properties for rent in the city.
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The median rent had also risen over the past few years by between $30 and $45 each year and now sat at $500 per week, according to REINZ data.
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Propertyscouts director Ryan Weir said there was a shortage of rental properties in Christchurch with some disheartened tenants arriving at their viewings in tears. They told stories of having to queue up with about 40 other people only to miss out on even talking with the letting agent.
Feedback from these desperate house hunters was that “it’s absolutely ridiculous out there” and “uncivilised”, he said.
Weir said they were getting swamped with applications for houses in good condition and good locations and these properties were usually leased within a few days. Yaldhurst was one of the suburbs performing extremely well in terms of rental demand.
The three- and four-bedroom properties were in the highest demand, while there was an oversupply of two-bedroom properties due to well-known developers building more of these properties than any others, he said.
Propertyscout director Ryan Weir said the shortage of rental properties in Christchurch is putting a lot of pressure on people. Photo / Supplied
Harcourts Holmwood Property Management managing director Caroline Register said it was “heartbreaking” watching good applicants miss out on a property just because there was only property, but several people wanting it.
“If you speak to anybody in the rental sector there’s certainly a shortage in Christchurch for sure.”
After the Christchurch earthquakes there were about 650 properties available for rent, she said, and it was hard for people to get housing. The market was mirroring what it was like back then and needed more rental stock to meet demand.
“We get multiple applications on a lot of the properties we list.”
People did eventually find homes, she added, but her advice to people was to start their hunt early, go to viewings and make sure the applications were filled out in their entirety to avoid any delays.
A normal property with normal access that had several viewings would likely be under application within about a week in the current market, she said.
People needed rental properties for a raft of reasons which could include moving into the area, a change of circumstances or because their current rental property had been sold.
In a tight rental market some people might have also had to compromise on their must-haves and ended up taking one bedroom less or a single garage instead of a double.
Bayleys investment sales specialist Angela Webb said stock levels were at an all-time low due to investors selling their rental properties because of all the red tape and extra costs.
Community organisations had also started renting residential properties at good market rates, she added, giving landlords the bonus of still being able to deduct tax from the interest.
“That’s pulling more stock of the standard rental market as well so there's just this short supply of housing.”
Rents were also jumping as a result of the shortage, she said.
While people were still buying investment properties, Webb said they were looking for ones where they could add value such as multi-income properties or that need renovating.
“If you’ve got a standard three-bedroom house rented out to a family, no one wants to buy that. The returns aren’t good enough with what the Government has done with all the expenses it’s costing. The fact that you can’t claim your interest as an expense just costs a huge amount of money – you end up with a massive tax bill.”
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