Rising rents for Otago University students could push them elsewhere, student leader says

As rental prices increase around the country, the Dunedin student rental market is confronted with a unique problem, Otago University Students Association president Quintin Jane says.

One of the reasons students are attracted to pursuing studies in Dunedin was due to its affordability, which he said, means that “you can really live the student experience”.

Rents currently advertised for a room in a standard student-shared flat arrangement range from $200 to $500, with the properties vastly ranging in size, quality, and number of occupants.

In January, a landlord came under fire for renting a 120-year-old home to students on Castle St which had mould-infested walls with large holes, cracks, and torn concrete flooring tiles, for $480 per week.

“My main concern is, if rent prices keep going the way they are going then students will stop coming to Dunedin. It’s as simple as that,” Jane said.

“When that value proposition is lost, students aren’t going to want to come anymore.”

Quintin Jane. Photo / University of Otago

In his third year at the university, Jane said he was working 15 to 20 hours per week on top of his fulltime studies in order to afford the rising cost of living.

The added workload caused him to suffer burn-out, contributing to his decision not to pursue post-graduate studies, he said.

The student rental market in Dunedin was in a unique situation compared to other cities in New Zealand experiencing rising rental costs, as many students were finding themselves paying “substantive increases for flats that were old and crap”, he said.

“[For example] As Christchurch has rebuilt itself, it’s become a really attractive city, and the rents have comparable prices [to Dunedin], but for brand new, or in the last five years, builds.”

He said he felt the issue facing student renters was not being recognised by property owners.

“It’s going to affect student numbers, which will have impacts obviously on the university, but also the [businesses] that survive or thrive off students being here.”

Third-year Otago University student Emily Fau-Goodwin said there was a lot of pressure facing students who were having to take on part-time jobs to afford paying rent.

“Because the rent is so high, they have to work and they have to earn more than they were before. Study Link doesn’t really cover it anymore.”

Due to her visa, Fau-Goodwin was unable to qualify for Study Link in her first two years of study and was working two jobs to get by.

She said grades had suffered due to the added workloads as she was unable to spend as much time studying as she would like to, which caused her to be concerned for her job prospects post-university.

University of Otago's clocktower building. Photo / RNZ

A University of Otago spokesperson said there was a fall in retention in 2023, but attributed this to factors other than rental costs.

”In particular, reduced levels of academic performance due to Covid-19 disruption; borders re-opening, enabling young people to travel for the first time in several years, the strength of the job market and student responses to the rising cost of living such as reducing study loads to work part-time while studying,” they said.

“Retention rates at Otago have been very stable over many years.”

They said the university put a significant effort into ensuring there was appropriate accommodation available for students, and strived to keep affordable and accessible through a number of university-owned flats, which mainly housed international students.

They also acknowledged their recent opening of the residential college Te Rangihīroa.

“While we have a positive working relationship with the local landlords’ association, we obviously do not have control over the costs of rental properties outside of the university.”

They said they recognised the rising costs of living, including flatting, as a national issue.

“The rising cost of flatting in Auckland and Wellington has been apparent over multiple years, and widely covered in the media. Earlier this year there was media coverage around concerns of rising flatting costs in Christchurch.”

Dunedin Property Management owner Rueben Skipper estimated there had been around 5 per cent rental increase for many student flats, but not over the entire student housing market and not more than any other year.

He attributed the rise of rental prices to supply and demand issues, plus the increased expenses for landlords, including interest rates and compliance costs.

There had been a comparably higher demand for housing in in 2023 in Dunedin over recent years, with the driving factors being to people relocating for work reasons, including the hospital rebuild, he said.

Students on a flat roof in Leith St, Dunedin. Photo / ODT

“Increased demand in the general market impacts the student market.

“A secondary reason is that changed regulations around required notice from exiting tenants have meant that there is less supply on the market when students are looking, i.e. August to October.

“As a result, there are a number of student rentals that aren’t coming on to the market until very late in the year, November/December, and they are not being filled until January or February.”

He denied that domestic student numbers would be dropping at Otago University due to the cost of rent though said recent changes to rental regulations were not suitable for the rental student market.

“Students tend to stay in university colleges in their first year at Otago. They don’t start flatting until second year. The cost of staying in a college is much higher than the cost of renting a single room in a flat. In recent years, university colleges have been largely oversubscribed.”

He said the idea portrayed in the media that students in Dunedin lived in squalid conditions was largely over-exaggerated, and limited to a small number of flats on a couple of particular streets.

“In my experience, the majority of landlords in Dunedin who own student flats provide greater service to student renters than is provided for general renters.”