Wakatipu rents remain among the country’s highest – but a property agent says prices will ease as winter tapers
New figures from the Department of Building and Housing show the rent for a three-bedroom house in the Wakatipu is 25 per cent higher than New Zealand as a whole.
The Wakatipu median rent is $400 per week, compared with the national median of $320.
Only well-regarded parts of Auckland are believed to outstrip resort rent levels.
The DBH figures are based on rental bonds lodged between February-July. No distinction is made between furnished or unfurnished properties.
‘Median rent’ is “the middle value when all of the weekly rents are placed in order of value,” the DBH says.
David Cole, chairman of the Queenstown Lakes Community Housing Trust, says spending 30 per cent of pre-tax household income on rent or mortgage repayments is “internationally considered to be the upper level of housing affordability”.
On that basis, a Wakatipu household would need to earn $70,000 gross per year to make the $400 per week median rent ‘affordable’.
Local property manager Doug MacGillivray says rents have increased this winter.
“Yes, there’s been a slight increase in rent levels,” he says.
MacGillivray won’t put a percentage on the increase: “You treat each house on an individual basis as it becomes available and depending on where it is and how long the tenants are staying – rent levels can be flexible.”
Housemart principal Hayley Stevenson, another veteran property manager, reckons rents have gradually risen about five per cent over the past six months.
However, MacGillivray cautions that those higher rents will ease as winter tenants pack their bags: “There may not be scope for a lot of increase in rents over the next wee while as stock levels increase.”
Stevenson adds her own warning: “Quite a few people are really chomping up the rents but I don’t think the market is quite ready for it – we’d sooner have our properties let at market rate than empty.”
Last Friday, MacGillivray’s Resort Property Rentals had only two places on its books – by early this week, five properties were available.
Stevenson manages about 100 properties – early this week, only three were vacant.
Housing trust chairman Cole believes Queenstown – and the rest of New Zealand – suffers from “rental congestion”.
“We have a structural affordability problem that discourages people from the natural migration from rental to purchase,” he explains.
“It makes absolutely no financial sense to purchase a house in this environment unless house prices are moving up strongly,” Cole says.
“It’s actually cheaper to rent than it is to buy … [which] just increases the demand for rental [housing] over the demand for buying.”
Cole sometimes senses what he calls “housing stress levels” in people trying to make a go of it in the Wakatipu when they compare rent levels with pay rates.
“And it’s not just rentals, it’s everything to do with housing,” he says.