Christchurch 'refugees' soaking up excess rentals

Photo / Herald On Sunday

Hundreds of refugees from earthquake-stricken Christchurch are soaking up excess rentals across New Zealand, latest figures show.

The First National Group's quarterly survey of its property managers found demand for rentals was steady and rents were rising more strongly than 12 months ago.

The group reported a national vacancy rate of 4.8 per cent for the March quarter, up from 2.5 per cent last year - a figure in part driven by the number of uninhabitable homes in Christchurch.

First National Group's general manager John Stewart said the Christchurch earthquake had dispersed residents to areas including Auckland, Timaru, Ashburton, Blenheim, Nelson and Central Otago, reducing vacancy rates in those areas.

"Families are also sharing with other families as job losses on top of loss of home and contents is causing financial stress," he said.

The figures follow those published by TradeMe last week which showed an oversupply of property everywhere, but in Auckland.

First National Group's general manager John Stewart suggested the earlier figures were "possibly linked to the earthquake and would include holiday homes and other accommodation not usually on the rental market".

Most of the group's property managers were reporting less inventory than at the same time last year, a fact which was supported by rents which were rising more strongly than last year.

"Perhaps the excess listings reported by TradeMe is also due in part to private landlords trying to rent out properties not up to scratch."

The group's property managers had commented on the need for good quality homes "with an increasingly discerning tenant populace", while landlords were reporting a shortage of good tenants in some areas.

"All these factors influence vacancy rates but must not distract from the real picture which is that demand is pushing rents up in more places around New Zealand than the same time last year."

Thirty-seven percent of First National's property managers reported increased rents year on year (up from 26 per cent), 47 per cent stayed the same (from 51 per cent) and just 16 per cent had dropped (from 23 per cent).

Meanwhile three bedroom properties, especially in the mid price range, were in highest demand, while there was less of a demand for one and two bedroom properties.

"In some parts of Auckland, where vacancy rates are lowest, they reported an oversupply of high end 4 bedroom properties in their area."

However, 32 per cent of offices reported shortages of lower priced properties, suggesting tenants were downsizing, Stewart said.