"Especially younger professionals in a flatting situation, they're quite happy in most cases to pay an extra $50 each a week - it adds up to an extra $200 for a property."
The tender strategy worked particularly well in the the sought-after inner-city and fringe suburbs, he said.
A Mt Eden property which had a price indication of $610 a week was rented for $750 to a group of four lawyers who had spent two months trying to secure a suitable home.
A three-bedroom house in Kingsland was also rented out at $750 - a $150 weekly increase on the price indication.
"They really wanted it and were sick of looking. It's a win-win for the tenant and the landlord," Mr Walker said.
Tenants Protection Association manager Helen Gatonyi is disgusted by the move, saying it will push up rental prices and force more tenants on to the street.
"It just epitomises everything that's wrong with the market. They see tenants as a commodity, an object," she said.
She said approaching rentals by tender added to the already problematic housing situation in Auckland.
"The homelessness is rising and that is a direct result of not being able to secure affordable housing."
Mr Walker dismissed the claim that the approach could push up market prices. "We don't control the market, it's the market that determines the weekly amount."
The approach was "definitely new" in the rental market, NZ Property Investors Federation president Andrew King said.
"This sort of strategy would probably appeal to landlords when the market is quite buoyant, as it is at the moment, as there are more tenants looking than there are properties available.
"This would ensure that you get the maximum that the market will be willing to pay."
In the past, landlords would look at similar properties in an area and rental statistics when setting rent levels.
Under the Tenancy Act, landlords can't charge more than the market level, "so this does appear to sit in with that because they're saying to the market, 'Tenants, what would you pay for this?' and the tenants say what they're willing to pay", he said.
But Mr King had a warning; while it was good news for landlords in a competitive market, it could be less so in quiet months when prices fell.
What's in it
For landlords
* Potential to get a higher rental income.
* No danger of underletting.
* Extra money can be used to improve the property, such as maintenance/chattels, or to pay off their mortgage faster.
For tenants
* Secure the house they want and save time and frustration of going to open homes and competing with other tenants.
* Could end up paying more than they would have at a set rate.
