City rents mostly below NZ average

Nidd Realty Property manager Amanda Ivamy goes to new heights to market this newly built set of...
Nidd Realty Property manager Amanda Ivamy goes to new heights to market this newly built set of 18 apartments in central Dunedin. Photo by Dan Hutchinson

Rental properties near the University of Otago continue to be the most sought after and expensive places to live in the city, but the rest of Dunedin continues to be an affordable city, those in the industry say.

The latest six-monthly report from the Department of Building and Housing shows average rents in Dunedin are well below the national average of $379.

Only the ''University/Maori Hill'' area, with an average rental of $424, was above the national average.

Real Estate Institute of New Zealand Otago spokeswoman Liz Nidd said Mosgiel was one area where good rentals were always snapped up quickly and good properties near the university commanded high prices, too.

She said the market in the rest of the city was pretty stable and there was a variety of high and low-quality accommodation to choose from.

Whenever tenancies came up for renewal landlords would seek to make improvements to houses so rentals could be increased but that was not always possible.

''Unfortunately Kiwis as a whole are inclined to love it or leave it a bit and are not inclined to undertake maintenance and refurbishment quite as frequently as they should.

''You get more money, you get a better-quality tenant and they [the properties] let more easily, so to me, it is a no-brainer.''

She said Mosgiel was an area where it was easy to rent out tidy properties.

There were also a range of houses available and it was not uncommon for more substantial properties to fetch more than $500 a week.

''There are potential tenants for those, particularly those who come in on two or three-year contracts.''

Otago Property Investors Association president Wendy Bowman said Dunedin was in the fortunate position where it was not expensive to rent, compared with places like Auckland and Christchurch.

''We are doing better than a lot of other areas. Imagine trying to rent up there.''

She said investors got higher rents in areas close to the university because they let individual rooms.

That market was still competitive and those with good-quality houses could command higher prices and get better tenants.

She said, in general, the Dunedin rental market was ''pretty steady''.

Results of the 2013 census show that more people in Dunedin are choosing to rent now than in 2006. In 2013, 12,645 dwellings were rented, compared with 11,766 in 2006.

- by Dan Hutchinson 

Average weekly rent for a three-bedroom house April 1, 2014 - September 30, 2014.

Caversham $298
CentralDunedin $308
Glenleith/Roslyn/Belleknowes $324
Kenmure/Mornington $302
Kew/St Clair/St Kilda East $322
Mosgiel $307
Musselburgh/Vauxhall/Peninsula $332
North Dunedin/Woodhaugh $312
Northeast Valley/Pine Hill $296
Ravensbourne/Mt Mera/Port Chalmers $274
Dunedin South/St Kilda $298
Sunnyvale/Abbotsford/Burnside $315
University/Maori Hill $424


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