Rental market: employers start to lease houses for out of town staff
Experienced Wanaka property manager, Colleen Topping, discusses the current rental market, for tenants and investment property owners...
A growing trend we are seeing amongst tenants is breaking their leases. In the last two months six percent of our tenants have chosen to break their leases. Because demand is still high, their homes have been filled.
Another emerging trend is that of rentals being snapped up by businesses which are paying for their employees who are being attracted from outside our region.
It is great to see that some of those tenants broke their leases because they bought houses in the wider Wanaka area. Others shifted because they have purchased businesses in Otago and Southland. We have had a few long term tenants (families) leave Wanaka recently, siting the ever-rising cost of living including rent (not that their particular landlords had increased their rent recently).
The majority of rental home owners are sensitive to their tenants’ circumstances and they value having people who look after their properties and pay the rent on time.
However, supply and demand, coupled with increasing costs such as higher rates and insurance premiums, means that rents inevitably rise upwards.
When we examine rents over the last three years we see that the biggest rise was from 2017 to 2018 for three bedroom homes – over 12 percent. This is also the most common rental house type in Wanaka, so it affects a big percentage of tenants.
Every winter Wanaka swells with workers coming to man the snow industry. This year is no exception.
What did seem different however, was how early the available houses got rented. By the end of May, Home & Co had rented all the houses we had available. Usually there would still be houses available to rent in June.
Employees who have contracts starting mid-June and ending in September are disadvantaged when it comes to renting, unless they are prepared to pay rent from some time in May to mid-October. Property owners quite naturally want to maximise on their assets.
We had a number of chilly prospective tenants camping out in their vans and desperately looking for homes in May, but very few at the moment. We do not have data to show if those people all eventually found rental homes, or if they left town due to the shortage.
From conversations with senior staff “up the hill” and those working with people who are having a hard time, they say the same thing – most people here for the winter seem to have found a place to stay.
I am aware of some of my friends who have taken in boarders for the winter. They say they wouldn’t normally do this, but they felt sorry for them and the extra bit of cash helps towards big heating costs and bills.
Colleen Topping, founder of Wanaka’s Home and Co property management firm, has been managing rental properties in Wanaka for more than a decade. She is an accredited property manager with a New Zealand Certificate in Property Management (Level 4). She also has a business degree and is an investment property owner.