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Home / Rotorua Daily Post

Rents rise across city

Stephanie Arthur-Worsop
Stephanie Arthur-Worsop
News Director, Rotorua Daily Post·Rotorua Daily Post·
20 Nov, 2015 08:00 PM4 mins to read

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DISPROPORTIONATE: Rotorua woman Nici Baldwin says the city's rising rents do not reflect average incomes.PHOTO/STEPHEN PARKER

DISPROPORTIONATE: Rotorua woman Nici Baldwin says the city's rising rents do not reflect average incomes.PHOTO/STEPHEN PARKER

Rotorua's average weekly rent has gone up $18 in the last 12 months, and is now at its highest level in 20 years.

Statistics from Tenancy Services - mapped into interactive graphics by insights.nzherald.co.nz - show the city's average rent now stands at $276 a week. At the same time last year renters were paying on average $258.

In the last 20 years, Rotorua average rents have gone up 86 per cent. In 1995, houses were rented for about $148 per week.

Local real estate agents say they are not surprised by the increase given the buoyant market Rotorua has experienced this year.

However, Rotorua woman Nici Baldwin says the increase is "ridiculous".

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"We are renting a three-bedroom house in Springfield and more than half our wages go towards rent. The cost of living in a decent home in Rotorua is becoming completely disproportionate to people's incomes."

Mrs Baldwin said people were forced to choose between cost of rent and house quality: "People who can't afford the rising cost of rent are being forced to live in substandard houses because that's all their budget allows.

"It's really sad because when I was studying I was in the same position - struggling to find a warm, healthy home for my son while still being able to afford to put food on our table."

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Mrs Baldwin said she had been told her rent was about to go up but it wasn't worth looking for another property.

"There is such a shortage of rental houses and there is so much demand that I don't want to risk leaving this house and not be able to find one for a reasonable price and decent standard."

Ross Stanway, chief executive of Realty Services, which operates Eves and Bayleys Real Estate, said figures spread across a 20-year period were bound to show an upward trend.

"It is a fairly conservative upward trend that would be on par with other regions with similar demographics and geographic size.

"What is more interesting is the increase in the last couple of years being driven by demand and the increase in interest from property investors."

Mr Stanway said many landlords were doing work to improve the standard of their rental properties which would be another factor influencing the increase.

He said comparing Rotorua's prices to average national prices would not create a fair comparison because national prices would be skewed by activity in areas like Auckland, Queenstown and Wellington.

"Rotorua has always been a good, solid rental centre with an attractive return for investors."

Russell Hardie Property Management director Donna Russell said the steady demand for properties in the last year would be influencing rent prices.

"Usually you will have busy months and slower months but this year has been full on since the start. Demand and supply has been constant so we are getting multiple rental applications for properties where we used to only get a couple.

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"My advice to renters is to remember they no longer have the luxury of procrastination. If you see something you like, make the decision because if you leave it a couple of days, you will miss out."

LJ Hooker Rotorua owner and principal Malcolm Forsyth said the increase did not surprise him: "We have noticed a number of landlords are taking the opportunity to cash out of their properties while the Rotorua market is somewhat buoyant. Many of these properties are being bought by first home buyers, ultimately taking the properties out of the rental pool.

"With less properties available to rent but a maintained demand for rentals, the prices are being driven up."

- To see the full interactive data experience, go to http://insights.nzherald.co.nz/.

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