No end in sight for city's growing rental shortage

Dan Lusby, owner of Tauranga Rentals says the shortage of rental properties in Tauranga is one of the worst he has seen in a long time. Photo / John Borren

Tauranga is in the grip of an escalating rental shortage - and real estate experts do not expect it will end any time soon.

Owner of Tauranga Rentals Dan Lusby said rental properties listed online had almost halved, from 300 to 150, in just two months.

In a snapshot of rental properties available on TradeMe yesterday, 136 properties were listed, 31 in Mount Maunganui and 18 in Papamoa.

Mr Lusby said he had not seen a shortage of rental properties "to this extent".

Tauranga Rentals received about 80 application in one week for a home in 15th Ave.

"We've got desperate people coming in, ringing in, emailing in saying they can't find anywhere to live and they've got to get out of the house they're in because it's been sold, or for whatever reason, and we just can't house them."

Mr Lusby believed the shortage was due to "growing pains" associated with the city's rapid growth. "Employment is high in Tauranga, with a lot of new industries which is creating new opportunities for people out of town to come here and want houses as well."

Mr Lusby said the shortage would reach homeowners who were looking to become investors.

"Most rental investment owners only own one or two properties at the most which is their form of retirement."

He did not think the shortage would end any time soon given the continued economic growth in the city.

The median rent for a Bay of Plenty property rose 4 per cent to $350 this August compared to the same month last year, according to Trade Me Property.

Rents for apartments in the region were up 19 per cent, to $340. Rents for medium-sized houses were up 14 per cent to $400 and those for small houses up 15 per cent, to $300.

Tauranga Harcourts General Manager Nigel Martin called the shortage "a supply-and-demand issue".

"We're still seeing houses being built but there is still a significant amount of people moving to the area," he said.

He had seen rental property shortages in the past but none that had lasted so long. "There's the natural move of people in town going from upgrading or downsizing their rental properties, but on top of that there's the outside Auckland influence which is really affecting the supply we have at the moment." He said a lot of properties were being snapped up before being advertised and weren't officially hitting the market.

Eves and Bayleys chief executive Ross Stanway said a lot of people moving to the area would rent first while they decided which suburb they wanted to buy in.

Some demand from Auckland was from investors who were planning to move to the Bay of Plenty at some stage and wanted a stake in the real estate market.