31/07/2024
**Changes in Rental Price Growth: A Perspective from Reliance Property Management**
**Impact of Immigration**
May 2024 witnessed a record number of migrant departures, as many New Zealanders left in search of better opportunities overseas. This exodus has resulted in an increase in available rental properties as their homes come onto the market. Despite net migration remaining positive, indicating more arrivals than departures, the expected rise in rental demand has not materialized as strongly as anticipated. This could be due to new migrants living with family members in existing homes or more people sharing rental properties. Statistics from Stats NZ highlight that net migration peaked in October 2023 and has been on a downward trend since then.
**Housing Market Dynamics**
The ongoing decline in house prices and the difficulty in selling properties have led many homeowners to turn their unsold homes into rental properties. At Reliance Property Management, we have observed a significant increase in clients opting to rent out properties they initially intended to sell. In the past four weeks alone, eight clients have made this switch, contributing to the growing rental market.
**Shift from Short-Term to Long-Term Rentals**
Although concrete data is scarce, it appears that some property owners are converting their short-term rentals into long-term rentals to secure more reliable income amid economic uncertainties. This shift is reflected in the noticeable increase in available rental stock. While tourism is gradually recovering, it has not yet reached pre-pandemic levels, likely prompting property owners to seek more stable rental arrangements.
**Increase in Rental Listings**
Our analysis of weekly Trade Me listings across Auckland shows a 3.60% increase in rental listings over the past 30 days, and an impressive 81% increase over the last 12 months. This surge in listings indicates a growing supply of rental properties, influenced by the factors mentioned above.
**Conclusion**
From our vantage point at Reliance Property Management, the rental market is experiencing significant changes driven by high migrant departures, a struggling housing market, and a shift from short-term to long-term rentals. These factors are collectively contributing to the increased availability of rental properties, which in turn, impacts rental price growth. As we continue to monitor these trends, our focus remains on providing our clients with the best possible management services to navigate this evolving market.
