Rents rise as buyers forced out of market
By Alanah Eriksen
Saturday Oct 26, 2013
House rental prices in Auckland could rise by up to 50 per cent in some areas because new mortgage lending restrictions are pushing would-be home owners into the rental market.
Market observers say rents for three-bedroom properties in suburbs near transport links and schools could be expected to rise the most.
One commentator says he has already started to see “slum-like conditions” in rental properties as desperate tenants crowd into homes to split the costs.
The latest Auckland rental figures, for the six months to September 30, just before the Reserve Bank’s loan-to-value ratio changes came in, show a 3 per cent increase in the weekly price for three-bedroom homes on the same period last year.
All but four of the city’s 30 suburbs – covering the area from Orewa to Pukekohe – had risen, according to property management company Crockers. Some renters were paying up to $50 a week more.
The area that encompasses Ponsonby, St Mary’s Bay and Herne Bay remained the most expensive place to rent at $766 a week – an increase of 6 per cent.
At the other end of the market, Pukekohe was the cheapest place to rent at $359 a week, but had still increased by 3 per cent.
Property investor and author Olly Newland said rents in some areas could go up by between 20 and 50 per cent over the next 12 to 18 months.
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