Renting in Tauranga? Here are the cheapest areas

Pāpāmoa Beach has the highest median weekly market rent in Tauranga, according to the latest MBIE figures. Nikki Signal has been renting there for four years, but now faces a move. Photo / George Novak

Which area of Tauranga should I live in? It's a question any newcomer to New Zealand's fifth-biggest city will ask themselves. A family making that move will, of course, ask the same. And don't forget the locals, maybe they want to up sticks and shift closer to the beach, or to work. Maybe they want to pay less rent.

Location is often everything when you're looking for your new home, but sometimes you can't afford the area you want. In this city of rising rents, it's often a juggling act where you need to compromise.

The Bay of Plenty Times has looked at some of the latest market rent data and has identified the cheapest and most expensive areas to rent in this year.
The most expensive Tauranga area to rent in this year is Pāpāmoa Beach, according to the latest data from the Ministry of Business, Innovation and Employment.

And the cheapest? Tauranga Central/Greerton.

The ministry's Tenancy Services has an online tool to find out what the weekly market rent is for properties in an area, based on bond data it collects.

For the six-month period between February 1 and July 31 this year, the median weekly market rent in Pāpāmoa Beach was $530.

In Tauranga Central/Greerton, it was almost $100 cheaper a week at $432.

Mount Maunganui was the second-most expensive at $515 a week.

Third was Pyes Pā/Hairini/Welcome Bay at $510 and fourth was Bethlehem/Otūmoetai at $490.

Tauranga Rentals owner Dan Lusby said the reason it was more expensive to rent in Pāpāmoa Beach, compared with, say, nearby Mount Maunganui, was the newer housing available there.

"We can get more money for new housing than we can for the older stock. And obviously Mount Maunganui – there are lots of apartments which are newer, but the housing stock itself is older."

Lusby said although Bethlehem was a dearer suburb, the likes of Bellevue, Brookfield and Judea (which are all combined into the same Bethlehem/Otūmoetai area for this rental data) dragged the overall median price down.

It was the same for Tauranga Central/Greerton – Merivale and Gate Pā dragged the median down.

"Tauranga Central itself is expensive but we don't have a lot of housing in Tauranga Central. And the good housing that's on Edgecumbe Rd and the Avenues, there's not a lot of them compared to say, Merivale or Greerton or Gate Pā."

He said there was not great rental selection around for people in Tauranga and that meant people were sometimes compromising where they wanted to live.

"If a prospective tenant comes to us and says 'We want to be near Bethlehem College' we might have one property they can have a look at. And they do have to compromise."

Tauranga Rentals owner Dan Lusby said there was not a great rental selection in Tauranga and sometimes people need to compromise. Photo / File

Simon Anderson, chief executive of Realty Group, which operates Eves and Bayleys, was surprised it was more expensive to rent in Pāpāmoa Beach than Mount Maunganui.

"However, there are more rentals in Pāpāmoa now and many are near-new homes so they attract higher rents," he said. "In the Mount, there is a wider range of properties which affects the average."

Anderson said there was a wider range of older homes in the Tauranga Central/Greerton area, which were cheaper to rent.

Earlier this month, new OneRoof and Valocity figures showed it was cheaper to rent a home in Tauranga than to buy, contrary to elsewhere in the country where servicing a mortgage was found to be cheaper than renting.

The data showed there were no suburbs in Tauranga where it was cheaper to buy than rent, despite low mortgage rates.

OneRoof editor Owen Vaughan said although it was generally cheaper to rent in Tauranga than to buy, buying was still a better option if budgets could stretch to it.

"The amount homeowners can expect to make via capital growth makes homeownership a compelling proposition even in higher priced property markets such as Tauranga," he said.

OneRoof editor Owen Vaughan. Photo / File

However, Tauranga Budget Advisory Service manager Shirley McCombe said, anecdotally, the majority of her clients were renting.

"Trying to save a 20 per cent deposit when rent is so high puts homeownership out of reach for many people," she said.

"Most people want a home of their own; the difficulty with renting is the availability in the first instance and the uncertainty moving forward, especially for families."

The Tenancy Services online tool also provides specific weekly market rent prices for flats, as well as other property types like apartments.

For example, the median weekly market rent for a two-bedroom flat in Tauranga Central/Greerton was $380, while a one-bedroom flat was $295.

A two-bedroom flat in Pāpāmoa Beach would cost $450, a one-bedroom $355.

Mount Maunganui was $420 and $345 respectively, Pyes Pā/Hairini/Welcome Bay was $380 and $325, and Bethlehem/Otūmoetai was $397 and $335.

Meanwhile, a three-bedroom flat in Mount Maunganui would cost $517 a week, Bethlehem/Otūmoetai $500, and Tauranga Central/Greerton $455.

Data for three-bedroom flats in the other two areas were not available.

The market rent information comes from bond data and the number of bonds lodged differs for each area – for instance, Pāpāmoa Beach had 388 and Tauranga Central/Greerton had 472 during that six-month period.

Any category that had less than five bonds lodged was excluded, to prevent individual properties from being identified.

Tenancy Services described market rent as the amount a landlord might reasonably expect to receive, and a tenant might reasonably expect to pay, for a tenancy.

It needed to be similar to the rent charged for similar properties in similar areas.

Median rent is the middle value when all of the weekly rents are placed in order of value.

Renting in Pāpāmoa Beach

Nikki Signal moved to Pāpāmoa Beach from Pyes Pā four years ago, where she was paying $450 in rent a week. Photo / George Novak

Nikki Signal has been renting in Pāpāmoa Beach for four years.

The 40-year-old pays $540 a week for the three-bedroom home near Golden Sands School.

She said she was lucky with how she secured the rental property.

"I didn't have the trouble I expected. Especially due to my circumstances of being a single working mother, with a cat, which is often another strike against you."

However, Signal was looking to move again due to construction happening behind her home. She said she was nervous about making the move because the market has changed.

"There is a high demand for rentals out here and there are a lot of houses that are asking for ridiculous prices. There is also always quite a cost for moving."

She moved to Pāpāmoa Beach from Pyes Pā, where she was paying $450 in rent a week.

When that home sold, Signal said she looked all over Tauranga for places to rent and settled on Pāpāmoa Beach.

She said it was away from the hustle and bustle of town, it had good schooling and was close to the beach.

"At that time Pāpāmoa really wasn't much dearer compared to other areas I was looking at. Now I really wouldn't want to move to another area."

Signal said moving out of the area was not an option because it would mean her children would have to move schools.

"It would have to be amazing for me to wish to move out of this area ..."

Median weekly market rent (February 1, 2019 – July 31, 2019)

Pāpāmoa Beach - $530
Mount Maunganui - $515
Pyes Pā/Hairini/Welcome Bay - $510
Bethlehem/Otūmoetai - $490
Tauranga Central/Greerton - $432

Source: Tenancy Services, Ministry of Business, Innovation and Employment