Rents on the up in Manawatu
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While Palmerston North's rental market does not have the same shortages as some centres, property managers say rents are still creeping up.
Commentary on First National Real Estate's quarterly survey said rents were continuing to increase across all the major centres, mainly because of a lack of rental properties.
But First National Palmerston North property manager Michael Ongley said the city did not have a supply problem.
"The basic way to describe it is as fairly well-balanced,'' he said.
"We've got a good supply of properties and good demand. I wouldn't say anything is out of kilter.
"Good old Palmerston North - steady as she goes.''
There had been a gradual increase of rents over time, which could be attributed to inflation, Mr Ongley said.
"On renewal of tenancies, rents are going up maybe $5 or $10 a week not a dramatic increase.
"It's just reflecting what's going on with everything else.''
Unique Realty residential property manager Jeff Raggett said rents had been gradually rising, but it was down to more than inflation.
Changes to property taxes, a double-whammy rates rise from both Horizons Regional Council and Palmerston North City Council and big insurance rises because of the Christchurch earthquakes had hit property investors, he said.
"They are some things owners or investors end up wearing.
"Every time stuff like this happens they're all out of pocket.''
Demand for rental accommodation was not a big price driver, because the city's population was fairly stable, he said.
"We don't have dramatic influxes of tenants like in Auckland.''
Mr Raggett said rent rises were being placed on family flats and student rentals in different ways.
"Students' rents are fixed for the year, from January to January, so rents can't increase during that time.
"At the end of that, people vacate and the owners re-evaluate the rent they are charging.
``I can just about bet on it that those rents will be going up.''
Family flats were usually on an open-ended agreement, which meant rents could be increased gradually over the year, Mr Raggett said.
Manawatu Tenants Union co-ordinator Kevin Reilly said he had noticed a lot more people coming in for advice lately. They had all been saying rents had been going up.
The hardest part was the rise of prices in low-quality accommodation, he said.
"It's Third World housing for First World rents.''
While it was hard for tenants, Mr Reilly said he knew landlords had to look after their interests as well.
"It's tough for both sides.''
- © Fairfax NZ News
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