Pressure on home-buyers increases the number of long-term renters

Soaring house prices and tighter lending rules mean ever-increasing numbers of New Zealanders are becoming long-term renters.

But getting a good deal as a renter can be just as cut-throat as securing an affordable home, especially in Auckland.

Trade Me figures show the average weekly rent was up 9 per cent in January, compared with the corresponding period in 2013.

In Auckland, the average rent was up 6.7 per cent to $480 a week.

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The increased competition for sought-after rentals has led to queues of as many as 50 people outside open homes. Some would-be tenants are offering to pay extra to secure properties, as well as submitting extensive CV-like applications.

But as the market shows no signs of abating, property managers have offered tips to help renters.

Celia Burbery, general manager at Auckland Property Management, said central suburbs were traditionally sought-after areas but tenants could get a nicer home if they looked farther afield.

"You could get something old and cold in the middle of the city but in Hobsonville you'd get a brick-and-tile home with double-glazing for the same dollar value," Burbery said.

Martin Evans, president of the Independent Property Managers Association, agreed tenants would do well to look to newer developments.

Evans said the appeal of a newer home compared to an old draughty villa would become even more apparent in winter.

He said tenants in an older property should not be afraid to ask for a heat pump to be installed and should never shy away from asking the landlord to keep on top of maintenance.

"If there are holes in the carpet you could say: 'If I wasn't here you'd have to replace it [to re-let it] so you should do it for me'."

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David Faulkner, of property management consultancy John Crocker and Associates, recommended would-be tenants should ask as many questions about a property as they would if they were planning to buy it.

Too many tenants did not know the obligations a rental agreement placed on landlords, he said.

"Tenants have plenty of rights but do not exercise them.

"This could be because of a fear of consequences, lack of education or a lack of knowledge."

He said if a property was being managed privately, the tenant should make sure the bond was lodged and it was made clear in the agreement who was responsible for things such as the lawns and gardens.

He recommended taking a video on moving-in day, especially if the property had any damage.

"People have different standards of maintenance and cleanliness but the condition should be reflected in the rent," Faulkner said.

Many tenants were afraid to do that, he said, because they worried the landlord would retaliate by kicking them out.

More education was needed about tenant rights, he said, especially with people being forced to rent for life.

Seeking a rental is now much like going for a job interview.

Property managers will seek references from employers and previous landlords.

And Burbery said given the competition for properties, tenants shouldn't become too despondent if they miss out on their first pick. Instead, they should do all they could to make themselves more attractive tenants.

Lower costs, fewer worries

Kirstin Steele of Takapuna says she would not be able to buy in the area. Photo / Getty Images
Kirstin Steele of Takapuna says she would not be able to buy in the area. Photo / Getty Images

Kirstin and John Steele's family have put their dream of buying a home on Auckland's North Shore on hold.

But the family of six still view their rental property in Takapuna as their castle. They have lived in it for six years.

"We wanted a good-sized house in a specific area," she said.

The three-bedroom home, for which they pay $470 a week, suits the family because it's in the right area for good schools.

"We can't afford to buy here. We can only afford to buy in areas we don't want to live in."

There were benefits to renting, Steele said, including having the property maintained by Auckland Property Management.

"If we were to buy we would have to lay out the money for the house plus pay rates and maintenance if something goes wrong. While we're renting if something goes wrong, we call the property manager."

Steele had built a good relationship with the management company. "It's the house we want to live in but it's old, so there are problems. They've worked with us to get things fixed. We look after the place so well they respect us as tenants.

"I know other people renting who don't have the relationship with their property managers and find it stressful."

Top tips for renters

• Look to rent around transportation hubs like the Merchant Quarter in New Lynn where there are trains or buses into the CBD.

• Look at where the ferries go. Options include Bayswater, Half Moon Bay, Hobsonville Point and Waiheke.

• Get a reference from your previous property managers. A letter of recommendation from a reputable real estate company is gold.

• Be realistic and think about it. A $900-plus a week, substandard, cold villa in Ponsonby or a $750 a week, double-glazed new home in Hobsonville Point?

• Look for professionally managed properties. Tenants will have the security of working with someone who follows the Residential Tenancies Act and abides by the regulations. Professional managers usually address issues promptly.

• Realestate.co.nz is the best site to look as only professional companies can use this site.

- Auckland Property Management