Real estate agency Barfoot & Thompson has expanded into Tauranga where it has bought a rental management business.
Samantha Arnold, the agency's property management general manager, said the business had bought the rent roll of Connect Realty Property, operating for 10 years.
That has its offices is on Cameron Rd and has five staff and the lease in the existing premises has been continued but the offices have been rebranded under the new banner.
Barfoot began operating from there at the start of this month.
Arnold is advertising for a new branch manager and said half the applicants were from Auckland and are ready to move.
The agency already has around 17,500 rental properties on its Auckland and Northland books in the division.
"Like Auckland, Tauranga is growing. Rents are on the increase according to the Ministry of Business, Innovation. Statistics show there has been steady growth in rental prices with the average rental per week increasing by 40 per cent over the last 10 years," Arnold said.
The agency has been operating for 98 years in Auckland and Northland and celebrates its centenary in 2023, she said.
The new Tauranga division has 250 properties on its books. Arnold said those were all in Tauranga and within a 10km radius of Cameron Rd.
Average rents in the city were $520/week, Arnold said.
"Rents in Tauranga have risen in line with Auckland by around 10 per cent in the last five years," she said.
"There is an interesting mix of hospitality and also a large industrial presence in Tauranga. This combination makes for many permanent residents who might prefer to rent a property," she said.
"Overall, we felt comfortable with this acquisition especially because there is high rental demand and rental yield in the area, plus the rent roll is very well aligned to our business because the prices and commissions are very similar," she said.
Connect had ensured landlords complied with the new healthy homes standards which are partly in force now but means all rental homes must fully comply by July 1, Arnold said.
"We looked at that during the due diligence process and we knew the properties complied with the law. We had looked at buying rent rolls before and realised some managers had not looked after the tenants or landlords which would have meant a tremendous amount of work for us," Arnold said.
Despite Government changes to the rental sector announced last month, Arnold had not noticed rents move strongly yet.
Landlords could only increase rents annually now, she stressed.