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Auckland Rental Market Update with Staircase Property Management
Investing in a rental property is a big decision, it’s about finding the right property within the right budget and in the right location, not to mention financing! Before leaping ahead, it’s a good idea to get some insights into the local rental market.
If you’re considering investing in an Auckland rental property read this first. Recently we spoke with full service property managers Staircase Property Management to get some insights on the current Auckland rental market.
What’s the current rental demand like in Auckland?
The demand for rentals in Auckland is currently high in most areas. Many available properties are attracting a lot of interest, especially in Manukau, West Auckland, and the North Shore. The apartment market was heavily impacted by COVID-19 and border restrictions. However, since the start of this year, we have seen a strong resurgence of interest in apartments, with rents stabilizing and a steady level of interest.
Tell us about the key factors contributing to the high demand
In the past decade, renting has evolved into a lifestyle choice rather than a temporary solution for individuals aiming to purchase their first home. As a result, the demand for rental properties in areas near workplaces, school zones, and public transport options has increased. The emergence of purpose-built community complexes has contributed to the establishment and flourishing of an urban vibe. Although the rental market experienced a significant decline during the COVID-19 pandemic, the situation has now shifted, and we are witnessing a high demand for properties.
What are three key features or amenities you think make Auckland apartment living attractive to tenants?
- The convenience of living and working in a central area with all the amenities they require within easy reach by public transport.
- The security of living in complexes that offer close or onsite building managers with good security systems.
- Easy access to the vibrant hustle and bustle of a major city with waterfront entertainment and attractions.
Image above: Artist’s render of an apartment at Augustus Park, Parnell
How do property values in Auckland typically change over time, and what can investors expect in terms of long-term capital growth?
Auckland consistently experiences the highest property appreciation compared to any other region in New Zealand. This can be attributed to several key factors, with one of them being Auckland’s role as the primary gateway into the country. Auckland boasts the largest population, attracts migration, offers abundant job opportunities, welcomes overseas students, and attracts tourism. All these factors contribute to a strong and vibrant rental demand.
Over the past three decades (from January 1992 to October 2022), house prices in New Zealand, excluding Auckland, have increased by an average of 6.5% per year, while house prices in Auckland have seen an average increase of 7.4%. According to the “law of 72,” any investment compounded at a rate of 7.2% per year will double in value within ten years. These figures highlight the significance of these market drivers, and their impact on the Auckland property market is not just a mere headline but a tangible reality.
What are the key benefits for tenants who rent a new-build townhouse or apartment?
There are a few benefits for tenants who choose to rent a new-build property vs an older property. The first is that they can be reassured that the property is going to be Healthy Homes compliant, meaning it will be at the required standard for heating, insulation, ventilation, moisture, drainage and draught stopping.
The second is that the tenant will most likely enjoy having little or no interference or interruptions to their lifestyle by maintenance, since the property is newly built.
And lastly the owner is more likely to want the security of a long-term tenancy if they have bought it specifically as an investment property – which ultimately will benefit both parties.
About Staircase Property Management
The team at Staircase has helped thousands of New Zealanders to become successful property investors over the last 20 years, setting them up with the lifestyle of their dreams.
They offer “end to end” Property Management service for all types of residential property, both long-term and short-term leasing.
Staircase are our preferred Property Management company for our residential developments.