Oversupply of rental properties in Bay
Bay landlords are cutting rents to attract tenants amid an oversupply of rental properties, an industry expert says.
The oversupply of properties meant prospective tenants were able to be picky, Dan Lusby of Tauranga Rentals said.
His comments follow the release of latest building and housing figures from the Ministry of Business, Innovation and Employment, which show how much a tenant should reasonably expect to pay in each suburb.
"It's looking quite good for tenants at the moment and we've got an over-supply of properties on Trade Me. There's about 450 properties available in Tauranga when it's normally around the 350 to 400 mark," Mr Lusby said.
"There is too much supply for the demand and some landlords have had to drop their price to get tenants in."
The figures reveal between September 1, 2012 and February 28, 2013, the average rent of a three-bedroom house in Tauranga Central/Greerton was $323. This was cheaper than the average rent for a three-bedroom home in Pyes Pa/Hairini/Welcome Bay ($333), Bethlehem/Otumoetai ($345) and Papamoa Beach ($352).
Mount Maunganui was the most expensive suburb to find a three-bedroom house (average rent $366) but this had always been the case, Mr Lusby said. Those who wanted an apartment in the coastal suburb had to pay more, with the average price of a three-bedroom apartment at $410.
Rentals BOP manager Gary Prentice told the Bay of Plenty Times Weekend apartments were a popular option for flatmates where the higher costs were shared.
"Flatting gives more return than a family renting, who possibly can't afford the higher rent," he said.
"Apartment living is quite popular because there's no lawns, it's low maintenance and a lot easier for tenants."
The average price of living dropped as you moved away from the central city, with the average price of a three-bedroom home in the Kaimai/Te Puke area sitting at $288 and Waihi Beach/Omokoroa at $307.
Mr Prentice said the figures were in line with the three previous years. He said some landlords had tried to put their rent up, based on the situation in Auckland, but most people in Tauranga could not afford higher rent.
Despite the oversupply, finding a rental property had been a nightmare for Tauranga woman Virginia Coles. She has been struggling to find a suitable place to rent for the past six months. Her flat in Gate Pa was cold and damp and without insulation, she said.
"I have been trying to find a flat in Greerton for the last six months [and] there is nothing out there that I can afford," she said.
She had been advised by her doctor to move out before winter but Mrs Coles was frustrated with the lack of suitable rental accommodation.
"I want a one-bedroom place that is reasonably warm, that has easy access ... but I cannot find anything in my budget."
Steve Warburton, owner of Prime Rentals in Tauranga told the Bay of Plenty Times Weekend people wanted quality accommodation.
"If the property is worth it, people are willing to spend a bit more to find a good quality home. The key thing is people do want a home. They don't want to live in some skungy rental property."