Wellington’s rental market is booming. 🚀
Landlords across the capital are seeing rental prices remain strong, with the capital’s lack of inventory not able to keep up with demand...
At around a quarter of the inventory levels of Auckland, Wellington sits as one of the regions with the lowest number of listed property for rent, fuelling the fire in Wellington’s rental crisis.
But what does all of this mean for investors?
Landlords must be aware that the rental market has changed dramatically since this time last year, but to what extent? In this edition, we evaluate Wellington’s booming market, statistics and all.
It is often said that statistics don’t lie, so what picture do they paint?
With stock levels at a low, there is no surprise that the rental market has a changing landscape.
Wellington, at the time of writing, has only 536 listed properties for rent.
While this may seem like a lot, Auckland sits with 1882 listed properties, almost four times as many.
Wellington’s average rental price rose 4.5% in June 2017 compared to June 2016. 💪
With the average rental sitting at $480 per week for a property in Wellington, the gap with Auckland, which has an average rental price of $560 per week, is beginning to shorten.
With no sign of this slowing up, landlords across the country will be considering reassessing their rents, making sure they are getting the right market value for their property.
It has long been suggested that three-bedroom properties are the most popular across the board, be it for tenants or owner occupiers.
The rental statistics for June seem to support this notion, with asking prices for three-bedroom homes moving 21% upwards when compared with the same month of 2016.
Whether this has stemmed from an increased demand thanks to tenants choosing to live in groups or whether there is a larger number of families looking to rent because rising house prices are preventing them from buying remains unknown, but it is easy to see that three-bedroom properties remain an excellent investment.
Two bedrooms too, had a significant increase, seeing a 10% rise in price while one-bedroom apartments in Wellington City saw an increase of 3.6%, continuing to suggest the changing wants and needs of tenants.
160 bonds were received for one or two-bedroom apartments in June of 2017 up from June of 2016, showing investors yet again that properties in the city will attract plenty of interest from tenants.
With the rents climbing accordingly, these apartments look to make excellent investments, with the growing rents signalling stronger yields for the cash flow conscious investor.
It is clear then that Wellington remains an exceptionally strong place to invest. High yields and increasing rental prices present seldom found opportunities to expand portfolios quickly by maximising rental prices.
With Auckland and Christchurch being witness to extremely slow rental markets thanks to excess stock and low tenant demand, Wellington’s yields and high demand will surely be attracting a huge number of investors. Where those investors will look remains to be seen.
Wellington’s new builds are rising rapidly from the ground, with townhouses and apartment complexes offering excellent ways into what will inevitably be a tightly held market of investment properties.
With the market showing no signs of slowing down’ Wellington landlords will be keen to keep hold of their stock.
It is hoped that the additional interest in Wellington’s market will allow for a rise in the standards of Wellington landlords.
The ever-changing landscape of the modern property investor market thanks to legislation has meant an increase in the standard of landlords for the most part, but if the level of landlord behaviour rises to the same extent as the rents in Wellington, there will be many extremely happy tenants.
If you would like to know more about how much your house is worth, or if you would like to know more about the changing legislation, call Jack today on 04 979 6363