Rents are on the rise in Rotorua, with mixed views on whether the latest interest rates hike will push them even higher.
Ministry of Business, Innovation and Employment data shows the average weekly rent in Rotorua rose 1.3 per cent to $237.67 for the three months to April, compared with the same quarter last year.
The Reserve Bank last week raised the official cash rate to 3.25 per cent, putting more pressure on mortgage holders.
It was the third hike since March, with the Reserve Bank indicating more are to come.
Russell Hardie Rotorua property manager Donna Russell said local rents should go up.
"All the landlord costs are going up, interest rates are going up, everything is going up and the landlords are getting slammed."
Continually rising costs meant landlords across the board should be able to raise their rents by $10-$20 each year to mitigate their losses, she said.
Landlords had a false reputation for being rich enough to absorb all the costs thrown at them.
"Tenants think, 'Oh my landlord's got heaps of money so it doesn't matter if I don't pay my rent'."
Rotorua Property Investors Association president Debbie Van Den Broek said many landlords had upped their rents after last year's insurance increases, which saw their insurance rise by $5 to $6 a week. She said some landlords had continued "wearing" those costs but were realising they could no longer do so. Mrs Van Den Broek said she wasn't particularly worried about the interest rate increases - yet.
"If it hits 8 per cent it will have an effect. I am not thinking about putting up my rents anytime soon, anyway."
She said if the proposed rental "warrant of fitness" scheme was introduced that might change things, as would rates increases. "You check your figures all the time, if you're starting to be out of pocket [you look at rents]." Rotorua rents were still cheaper than many other towns, she said.
Rebecca Knowles and her husband own a three-bedroom Western Heights house they rent out for $260 a week. They bucked the trend by dropping the rent by $10 in order to keep their good tenants, who were struggling financially. When those tenants moved on, they left it at $260.
"We'd rather have good people in there and have it looked after than having the rent higher," she said.
Mrs Knowles said if costs increased again, they might have to consider a rent increase, but they would prefer not to.
Nationally, the average weekly rent increased 2.5 per cent to almost $265 in the three months to April compared with the same period in 2013.