Cashed up Aucklanders are being blamed for pushing up property prices in Hawke's Bay to record levels.
House prices and rents have risen in Napier. Photo: Ramunas/123RF
House prices and rents have risen dramatically over the past two years, while the number of homeless Hawke's Bay families waiting for a state house has more than doubled.
Social services said they're seeing an increasing number of people turning to them for help to find a home.
The median house price in the region has risen 36 percent over the past two years to $438,000, while median rents have increased by about a fifth.
"The Auckland buyers have grown significantly in the last two to three years," Tremain Group managing director Simon Tremain said, as they realised the difference between the median price in Auckland and what it was in Hawke's Bay.
While buyers had flocked to the region, landlords were selling up, resulting in very few properties available to rent.
It was not uncommon to have 40 groups of people viewing a single house, Harcourts property management group manager James Moran said.
"We're swamped with inquiries and phone calls from prospective tenants, we're having to carry out open home style viewing to enable us to get people through."
Lending restrictions and new requirements to insulate rental properties had enticed many landlords to sell while prices were high over the last few years, resulting in a dramatic drop in homes for rent, he said.
The median weekly rent in Napier has increased by 24 percent over the past two years to $390, in Hastings, it had risen 21 percent to $375, according to figures from Trade Me.
Napier Family Centre chief executive Kath Curran said high rents and the difficulty in finding a home had driven more people seeking help from its budget advisers.
Kath Curran, CEO of Napier Family Centre. Photo: RNZ / Anusha Bradley
They often had to choose unsuitable accomodation or live with family members, because they could not afford the rent, she said.
The Salvation Army in Napier said more than a third of the people it saw had trouble finding a place to live.
A spokesperson said two years ago it had three transitional housing units that were only full about a third of the time. Now, it had seven units and a waiting list of people.
As of December there were 398 families waiting for a state house, up from 150 two years ago.
The Ministry of Social Development said it has 2,674 social houses in Hawke's Bay and it would build another 209 by 2020.
In the meantime, Simon Tremain predicted house prices could rise by another 5 to 10 percent this year.