In this quarter, there were five regions showing some improvement, however the remaining eleven regions show deterioration in affordability.
For the June 2021 – September 2021 quarter, nationally there was a 3.52 per cent improvement in affordability, however annually September 2020 – September 2021, rents increased by 5.6 per cent.
At a regional level, the report shows rental affordability deteriorated in 11 of the 16 regions with Southland and Taranaki bucking the trend.
Seven regions are deemed less affordable than the national average which is set at 100 per cent. The remaining nine regions are all relatively more affordable for renters than the national average, but two regions continue to stand out as being the most affordable – Southland (84.2 per cent) and West Coast (69 per cent).
- Bay of Plenty – 118.1 per cent
- Hawke’s Bay – 113.9 per cent
- Tasman – 113.9 per cent
- Marlborough – 113.6 per cent
- Northland – 113.4 per cent
- Gisborne – 108.7 per cent
- Auckland – 103.3 per cent
The largest annual rent increases were recorded in five regions:
- Gisborne – 32.3 per cent
- Taranaki – 18.2 per cent
- Northland – 16.3 per cent
- Southland – 15.2 per cent
- Bay of Plenty – 14.7 per cent
In Gisborne, rental costs rose more than 30 per cent during September 2020 – September 2021, while Auckland and Wellington showed a moderate increase of 10.9 per cent and 9.9 per cent respectively for the year.
Dr Ashad Javed
Report authors, Dr Arshad Javed and Professor Graham Squires from the Massey University Real Estate Analysis Unit, say there are a number of varied factors impacting rental prices across New Zealand.
“These include rising house prices that feed through the housing system towards renters, a shortage of properties, and rising costs for landlords given recent policy changes,” Professor Squires says.
“In this quarter, there were five regions showing some improvement, however the remaining eleven regions show deterioration in affordability,” Dr Javed adds.
“Over the past quarter, rental charges decreased in four regions and increased in the remaining twelve regions, with a net result of 2.7 per cent decrease for the June – September 2021 quarter. Auckland and Wellington remain the most expensive cities to rent accommodation, at an average of $592 and $532 per week respectively,” Dr Javed says.
National and regional affordability are calculated by dividing the respective average weekly wages into the respective geometric mean rents.
Professor Graham Squires