A long-term property manager has described Rotorua's rental situation as the worst he has seen in 25 years, as people struggle to find properties.

Rotorua Rentals co-director Richard Evans said there was a shortage of listings, with good homes snapped up and those missing out often having to settle for a less than ideal house.

It comes as the Trade Me rental price figures for August show the median price of a rental in Rotorua is $290 - something real estate agents say is reflective of the lack of larger, suitable rentals available.

And while some agents say they are seeing a slight increase in properties available, they say many are smaller two-bedroom properties or bedsits.

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Mr Evans said it was hard to find suitable homes .

"It is very, very, very difficult to get a rental and is just so frustrating. You've got quality people and you just can't look after them all."

He only had three rentals available.

"It's very difficult, particularly if you are coming from out of town."

Mr Evans said he had people relocating to Rotorua who were ringing daily to try to find a house to move into.

He said the lack of houses and number of people looking made it tough on landlords trying to choose the right tenants. Sometimes, it was so difficult they had to toss a coin to make the decision, he said.

"It's the worst I've seen it in the last 25 years."

Tenants who were having houses sold or needed to move out were in desperate situations trying to find somewhere else, he said

He said it was normal now to have about 30 people turn up to view houses.

"It will get worse as it gets nearer to Christmas."

Another property had more than a dozen people interested within two hours of being listed on the firm's website - "and they are still coming in".

Mr Evans said he found people were settling for houses they wouldn't normally consider.

"People are thinking 'I'll take this, at least I'll have a roof over our heads'."

He said people were paying fairly high rents. He was aware of one house, in Fordlands, where the rent had increased $140 over the past three months.

Chief executive of Eves and Bayleys Ross Stanway said it was a tougher market for renters.

"In recent years a lot of the rental properties have been purchased by first-home buyers, taking them completely out of the rental pool.

"On top of that, there has been an increase in people moving to Rotorua, some of which will also be renters so those two factors combined is putting pressure on the market."

Professionals McDowell Real Estate Rotorua principal Steve Lovegrove said they were seeing an increasing number of homes that would normally be bought by investors being bought by first-home buyers.

He said often they were seeing people look for creative ways to get into their first home, including getting parents or other family to help.

Mr Lovegrove said they had noticed more people upgrading to higher value rentals, which left a lot of the smaller properties available, and often they were in lower socio-economic areas.

They had about 30 available which was more than usual but more than half of those were small flats ranging from bedsits to two-bedroom properties.

One rental recently had 34 people go through in two days, he said.

Professionals property manager Stephanie Trainer said there was still a big demand for reasonably priced family properties.

She said those that were three bedroom, priced in the $300 price point were "bombarded" with interest.

"It's definitely tougher [for prospective tenants] in the respect that the landlords are a lot pickier. That can pick the best tenant."

LJ Hooker director/principal Malcolm Forsyth said while they had seen a few more properties available for rent, it wasn't a significant increase.

"We've certainly found a few more coming on stream for various reasons but we're not talking about an epidemic."

"A lot of tenants seem to be moving in with family because there have been rental increases."

He said while a few months ago there would have been two or three empty properties at any given time, there were now eight or nine.

Mr Forsyth said they were still seeing "double figures" at the viewings and people lining up to see the in demand properties.

"It's very hard to find something under $300 a week unless it is a flat."

Prospective tenants were also finding they were missing out on several properties before securing a rental.

"That is an unfortunate fact. It is just a perseverance thing. We are getting some really good tenants that miss out."