Keeping your finger to the rental price pulse is a good way of determining how strongly the rental market is performing. Trade Me Property's latest figures show that rental prices surged 9 per cent in the 12 months to January. Growing asking rents usually signal that more renters are chasing down accommodation, which is fantastic news for those of you looking to capitalise on your residential investment property.
Nigel Jeffries, Head of Trade Me Property, said this was the single largest monthly rise in five years. While this might not comfort tenants, investors will relish the news.
"Median weekly rents clicked up $20 per week between December and January to a record high of $420 per week," he said.
Some of the largest increases were seen in Auckland, where rents climbed 6.7 per cent over the year to January; Wellington, which saw rents up 6 per cent; and 8.4 per cent surge in Canterbury. In fact, everywhere but Gisbourne and the West Coast experienced surging rents, with 8 of the 15 regions showing new records highs.
Mr Jeffries suggest that rising rents show savvy landlords are taking advantage of rising house prices to recover as much money as possible on their investment.
"It was more a question of when – not if – landlords were going to start recovering some level of yield. It looks like that signal has flowed into the market this month and started to sting tenants in the pocket," he said.
The figures show that a staggering 60 per cent of the country's apartments are in Auckland, which provided another fruitful year for investors. Asking prices for apartments jumped an impressive 7.5. per cent on the previous year, suggesting that more and more renters in the City of Sails are looking to medium and high density accommodation.
Glancing over this data can help you understand where demand for rental properties is highest, but to back up your knowledge, speak to an Authorised Financial Adviser like us here at Goodlife for expert investment advice.
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