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Alanah Eriksen

Alanah Eriksen is the New Zealand Herald's property reporter, and assistant chief reporter.

Squeezed in city of rising rents

What tenants pay for a three-bedroom home in Mt Roskill has risen 18% since 2010 whereas rents in popular city suburbs such as Remuera have risen only 6%, according to Crockers' rent comparison table.

Britons Joe Vaughan, Sam Jeffery and Darren A'Court love living in Auckland despite the price of beer. Photo / Natalie Slade
Britons Joe Vaughan, Sam Jeffery and Darren A'Court love living in Auckland despite the price of beer. Photo / Natalie Slade

Renters are paying up to $70 more a week than they were four years ago in some of Auckland's city fringe suburbs, while prices in the traditionally more sought-after areas have risen at a less rapid rate.

The Herald has analysed figures from Crockers' annual four-year rent comparison table.

The property management company calculated the average median rent using the number of bonds received each month with data received from the Real Estate Institute and the Department of Housing and Building for one, two, three and four-bedroom homes.

Rent in all 30 suburbs and for all-sized houses went up over the four years.

Rent for three-bedroom homes in the area defined as Mt Roskill (Owairaka, Lynfield) had risen the most since 2010 - by 18 per cent - from $391 to $461.

Other big rises were also seen in the city fringe suburbs Waterview, Avondale and Titirangi (a 17 per cent rise) and Sandringham, Three Kings and Hillsborough (16 per cent).

Popular city surburbs such as Remuera rose the least - at 6 per cent.

The City Centre (which includes Parnell, Grafton and Newton) rose 7 per cent, while City Bays (the area from Mission Bay to St Heliers), Epsom, Newmarket and Royal Oak North all rose 10 per cent.

Real Estate Institute chief executive Helen O'Sullivan said the figures reflected rising sales prices in the city fringe suburbs. "As prices rise, we're just being pushed further out. When you can't afford Kingsland, you go to Sandringham. When you can't afford Sandringham, people are now looking at Mt Roskill and so on.

"We're seeing that in the sales stats so it's no great surprise the same is happening with rents as rents in the more desirable suburbs creep up.

"The percentage increase in places like Ponsonby and Herne Bay is slowing because the base is a lot higher." She said the new Southwestern Motorway in Mt Roskill has made the suburb much more accessible.

"And a lot of those little suburbs now have their own little nightlife. Kingsland used to have six shops and a pub once upon a time. They'd have a pub quiz on a Tuesday and that was it.

"People were starting to say 'Why pay another $150 to live in Ponsonby when I've got everything here'."

Ponsonby (which includes Herne Bay and St Marys Bay) and Grey Lynn/Westmere remained the most expensive places to be a tenant in a three-bedroom house last year ($754 and $661 respectively).

The cheapest spots were Pukekohe/Tuakau/Waiuku ($359), followed by Papakura ($374). But both the areas still rose by 14 per cent.

The biggest rise for a suburb out of homes of all sizes was for one-bedroom houses in Takapuna/Milford - a jump of 50 per cent to $423 a week.

But Crockers spokeswoman Kim Sinclair said some areas could show high fluctuations due to a limited number of bonds received.

"And in some months, no bonds are received at all for that property type within that suburb which does skew the variance and rental price."

Auckland as a whole rose 12 per cent to $515 for three bedroom homes, compared with 13 per cent for all of New Zealand (to $382).

Meanwhile, Crockers' latest Property Investment Index showed that despite the expected returns from existing properties continuing to increase, the likelihood of more investing in new rental properties continued to fall.

"This suggests that property investors may be rethinking future investments, possibly because of the reduced yields to be enjoyed from inflated prices," Crockers said.

Just 4 per cent of respondents to the survey said they expected the performance of their property investments to worsen over the next 12 months - down from 8 per cent the previous month. This low level was last seen in October 2012.

The proportion expecting the performance of their property investments to remain the same had stabilised (63 per cent), while those that expected their investments to increase had increased slightly to 34 per cent.

Just 13 per cent said they planned on investing further over the next 12 months - the lowest level in several years.

Among those planning to invest further, there was an increase in those looking at apartments outside of the CBD.

Three Brits say lifestyle makes up for high rent

Living in Auckland has come at a hefty price for three Englishmen.

Sam Jeffery, 25, Darren A'Court, 24, and Joe Vaughan, 30, pay about $245 a week each for their rented three-bedroom townhouse bordering Freemans Bay and the CBD. That doesn't include their $120-a-month electricity bill, $90 Sky and internet bill, petrol and food.

"Food is ridiculously expensive," Mr Jeffery said. "Meat is so expensive, as is alcohol. A full pint in England is about $5, but two-thirds of a pint here is probably more like $8."

The group met in Brighton and Mr Jeffrey said he paid about £110 ($220) a week there which included rent and bills, despite the seaside town being "just shy of London prices".

But the Auckland lifestyle makes the cost worth it, he says.

"It's a 10-minute walk to work, we live near Victoria Park and Wynyard Quarter, which is a great place, and we can keep a car in town."

The recruitment consultant arrived about 11 months ago after backpacking around South and Central America with Mr A'Court. He had planned on an extended holiday in New Zealand but now intends to stay for the foreseeable future.

A holiday in Britain over Christmas cemented his choice.

"London is so busy, hectic, dirty and loud but Auckland ...is not busy at all."

- NZ Herald

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