Rental crisis in Tauranga causing distress and desperation for those who need a home

Rising prices and lack of properties in Tauranga have raised alarm bells with property managers and social agencies. Photo / File

Want to rent an average three-bedroom home, in an average location in Tauranga?

That will be $490 a week or $25,480 a year thank you, say local experts.

Rising prices and lack of properties have raised alarm bells with property managers and social agencies who say there are many desperate and distressed people seeking rental homes.

Some had decided to ditch the city altogether while others were living in caravans, sheds, tents, cars, garages or crowded into the homes of relatives or friends.

Simon Anderson, chief executive of Realty Group, said his staff were dealing with some "reasonably distressed" people looking for accommodation "which is a deep concern''.

An array of factors had influenced the situation, he said, including a limited supply of rentals that were snapped up as soon as they became available and a tight market driving up prices.

Tauranga Rentals owner Dan Lusby said its average rent per week for a three-bedroom house in an average location had jumped to $490 this year from $460 last year.

There were some ''desperate'' people looking for homes in the city, he said.

It was not unusual to get 100 applicants for one house, he said and some landlords were selling up because of law changes and tougher rules regarding insulation and heating.

''We have got five rentals up for sale at the moment ... it has affected us and I am forever chasing new business.''

Some owners had also decided to move back into their rentals with two taking that option in the past month.

However, Tauranga Harcourts managing director Nigel Martin said the portfolio of properties it looked after had increased by 30 per cent due in part to the growth in new housing developments.

He acknowledged the rise in weekly rents, which he said was inevitable due to the current market.

''That is what is holding the rental price up.''

Meanwhile, Tauranga Budget Advice financial mentor Alison Craig said some of its clients paying $500 to $600 for a three-bedroom home were at risk of eviction and were ''juggling" their living expenses each week, paying some of each bill and getting behind on everything.

The rental crisis was affecting the city's most vulnerable people severely, Craig said, with an increase in the "working poor" who could not meet living costs and finding themselves in crisis.

Tommy Wilson, of Greerton-based Te Tuinga Whanau Support Services Trust, said the situation would get worse before it gets better.

''The first thing we have to deal with is families that are able to sleep on a couch or in someone's shed but that is not going to work so well in the winter.''

The trust was housing more than 50 families in 30 residences and its top priority at the moment was finding rentals for three mothers who had four to five children each.

Trade Me figures show the median weekly rent last month for a three to four-bedroom house was $550, up 6.8 per cent on February last year.

One Roof editor Owen Vaughan said property investors had pulled back in Tauranga because there were better returns elsewhere.

''That means you have a stagnant rental market and a limited pool of stock.''

Tenancy Services data provided by the Ministry of Business, Innovation and Employment from September 1 last year to February 28 reveal there were 1765 bonds lodged for apartments, flats and houses in Tauranga.