Bay's rents rose by 2.4pc last month

By Patrick O'Sullivan

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Hawke's Bay rents increased 2.4 per cent in February compared with the same period last year.
Hawke's Bay rents increased 2.4 per cent in February compared with the same period last year.

Despite a burgeoning real estate market, Hawke's Bay rents increased 2.4 per cent in February compared with the same period last year, according to the Trade Me Property Rental Index.

It showed Napier rents stayed at $330 per week from February 2015 to February 2016 while Hastings' median rent went from $300 to $320.

Nationally the increase was 4.9 per cent.

Hawke's Bay Property Investors Association vice-president Graham Duff said Trade Me figures were merely asking prices and "the actual" rent agreed between landlord and tenant was often lower.

But bargaining was becoming less common because of increased economic fortunes in Hawke's Bay attracting more people to the region. Previously rents were flat in Hawke's Bay for about five years.

"This lift was quite expected and it is not big," he said.

REINZ figures for February revealed house sale volumes were up 35 per cent on February 2015 and the median price rose $40,500 to $330,000, an 8 per cent increase.

He said increased house values were not linked to rents.

"Rents are entirely market driven - what people can afford."

While accountants may advise landlords to put up rents, to ensure a return commensurate with the increased property value, "the reality is if you have good tenants you want to keep them".

He said most rental increases occurred when a house was re-let. "Most property investors understand you are much better to get $10 less a week and keep the tenant, rather than go two or three weeks without a tenant."

If the Hawke's Bay economy continued to do well rents would probably increase because of a rising ability to pay and more people coming to the region.

"I am getting more frequent telephone calls now from people who know my tenants, asking if I have anything to rent."

- Hawkes Bay Today

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