Squeeze on tenants as rents soar 15pc

Rental prices in Rotorua are up 15 percent.

Tenants in Rotorua are forking out more for a rental home as prices climb.

Trade Me's Rental Price Index shows the asking price for median weekly rent in Rotorua was $320 in March for a medium-sized home (3-4 bedrooms), which is a 15 per cent increase on the $277.50 being sought in March 2014.

Pam Jones from Pam Jones Property Management in Rotorua said rent increases were due to rising costs for landlords.

"Most of my properties have had rent increases in the past year but that is because property costs have gone up," she said. "Insurance and rates have gone up so, of course, rents have been increased slightly to cover some of the costs. It is really that increased landlord costs are forcing us to have to put rents up."

Mrs Jones said there was high demand for rental properties in Rotorua.

"I can't get enough homes and so we have tenants waiting for homes, and we can't meet the demand of their requirements. We have found there are quite a few families coming back from Australia and they are looking for the better quality properties, which is driving up demand.

"We have very little vacancy. Good quality homes are turning over quickly and often you have got choices between prospective tenants," she said.

Nationwide, the median asking rent for properties in March this year increased by 7.7 per cent compared with March the previous year.

The median rent sought by landlords soared to $420 per week, up from $390 per week a year ago.

Trade Me Property head Nigel Jeffries said the rental market was not great for tenants, with rent increases in 11 out of 15 regions across the country.

"There is continued pressure on asking rents, with Auckland tenants being asked to pay almost 7 per cent more than a year ago, with the median rent at a new high of $480 per week," he said. "Weekly rents in the city have broken through new records in 22 out of the past 24 months, and have continued to tick up from when they were $440 per week, back in March 2013."

The strongest growth in median weekly rental prices was recorded in Canterbury, where rents were up 14.1 per cent over the past year.

This was followed by Northland, where median rents increased by 12.5 per cent.

The median weekly rent across the country for a large house, five or more bedrooms, was $680; for a medium house it was $470; and for a small house, $320.