Wellington renters are staying in the same flats for longer amid soaring prices, leading to a decline in the number of rentals on offer.
Wellington renters are staying put, putting more pressure on rental stocks. Photo: 123rf.com
Figures released by Trademe yesterday showed the capital had seen a 70 percent drop in the number of places to rent in the past year, while median prices surged nearly 7 percent to $480 a week.
Wellington's median asking price for weekly rent was $40 less than in Auckland - but nearly 25 percent higher than five years ago.
Erin Cameron, a massage therapy student, is one renter struggling to find an affordable room in Wellington.
Working on top on study gives her an income of about $400 to $450 per week, and she said she was shocked by rooms going for more than half her weekly paycheck.
"Just spacious rooms in a house are going for upwards of $260 or $300.
"It's either couples or people actually sharing rooms - like friends sharing rooms."
Ms Cameron looked at the greater Wellington area, but said while there was cheaper rent further away, there was a catch.
"The rent might be lower but then you've got transport costs having to come into the city every day for school and then trying to get over to Newtown every weekend for work.
"The transport costs just bump it straight back up," she said.
"I had to turn down a flat in Petone, because I wouldn't have been able to afford it."
Trademe head of property Nigel Jefferies said demand for accommodation in the capital was hot at the moment, with more people coming in to study and work.
He said the pressure on the market had doubled, with people who would traditionally move on to buying houses staying on longer at rentals
"The first-home-buyer market makes up around 30 percent of buyers. It's now harder to buy your first home.
"So that's had a one-off effect whereby the people that are renting property and would expect to move into their own home, that change hasn't happened because they have to save for longer to get a larger deposit."
Matt Watson - who owns a branch of Quinovic, a property management group in Wellington - echoed that sentiment, saying it was clear the city had a lack of housing stock.
There was a "natural balance" with the fewer people who were electing to move seeking the properties that were available. "What would throw it out of balance is if we've got more people moving into Wellington and at the same time we've got those fewer people electing to move out of their properties, so the remaining properties available for everybody is reduced."
Mr Watson predicted prices would level out when more apartments were built in the city.
Richard Bacon, a landlord with a handful of rentals in Wellington, said his advice for people struggling to find a rental was to look further afield.
"Be a little more open. Be a little bit more creative about solutions.
"Don't worry about commuting 20 minutes or even an hour. If you live in a big city you expect to commute a certain amount," he said.
"If you've come from Auckland you're looking at an hour commute to get anywhere. Whereas you come to Wellington and it's 15 to 20 minutes.
"Wanting to live in the centre of town, you're going to have to pay for that upside."
Mr Bacon said rent prices in Wellington had not been increasing much over the past 10 years, but were now catching up after increases in the past 12 months.
He said the cost of owning a property was still more than what the average rental cost, as landlords had to contest with rates and insurance increases.