Tough times could be ahead for Tauranga renters as demand outstrips supply

The rental market in Tauranga has remained strong despite Covid. Photo / File

Tough times could be ahead for Tauranga renters as demand for property outstrips supply and experts warn of future price hikes.

One rental agency in the city said last month was its busiest month on record. One home had 50 applications in two days and the listing had to be taken down because of the overwhelming response.

Tauranga Rentals owner Dan Lusby says it is "flat out". Photo / File

Tauranga Rentals owner Dan Lusby said it was ''flat out'' and last month, ''we just rented everything''.

He said some great applicants had applied for housing and ''that was the trouble, we list them one day and they are gone the next''.

''We are back down to zero almost again... one of my property managers had to cut off applications for one house, at 50 after a couple of days.''

Three motel units also became available within one week and two rented straight away so demand was across the board, he said.

A re-listed four-bedroom home in Tauranga, which would escape the Government rent freeze that ends on September 25 because the previous tenants had moved out, would be $600 a week.

Harcourts Tauranga Advantage Realty managing director and business owner Nigel Martin said there was strong demand for rentals.

Harcourts Taurnaga Advantage Realty managing director and business owner Nigel Martin. Photo / Supplied

He expected a number of landlords would increase rents once the freeze ended to adjust to market rates.

''At the end of the day, the market determines the rent, not the landlord.''

The biggest issue on the radar at the moment for landlords was compliance and bringing houses up to healthy homes standards.

There were also more first-home buyers competing for rentals alongside investors, he said which was affecting supply.

Realty Group managing director Simon Anderson says there is limited rental stock available. Photo / File

Realty Group managing director Simon Anderson said any rental that came onto the market that was in a good location and close to schools and amenities would be snapped up quickly.

He said a quality mid-priced home could attract 40 applicants due to limited stock. On the flip side, there was less demand for higher-priced houses.

Other trends were expats returning from overseas while there were good opportunities for investors and first-home buyers.

Tremains Tauranga Business Development manager Shonagh Harris said there was pressure on the supply and well-presented, good quality properties were being rented quickly.

She said letters had only been sent out to tenants who may have been facing a rent increase prior to Covid-19.

''We have a duty of care to both parties... we have only looked at those ones as they were overdue.''

Harris said during lockdown some of its ''landlords did some really heartwarming stuff.

''They were ringing in and saying what does our tenant need while some reduced the rents. We just saw some really nice gestures of goodwill.''

The lockdown was challenging for everyone involved, she said and staff were helping
out tenants with lots of different issues that they had never had to deal with before.

''We were very aware through the whole process about being kind and open.''

Trade Me figures show the median June rent in Tauranga was $540 and $20 more than the same time last year.

Trade Me Property spokesman Aaron Clancy said Tauranga has seen rents steadily increase over the past few years and demand in June was up by 18 per cent over the same timeframes. Meanwhile, supply was down by 13 per cent.

''With supply struggling to keep up with demand, we expect to see rental prices continue to increase in the district in the coming months.''

Who got the house?

Excellent references are just one requirement that landlords take into consideration. Photo / Getty Images

Doing your homework and having excellent references stood Graham Brown in good stead when he applied for a house in Pyes Pa alongside 49 other applicants.

He had been in a long-term rental for four years with his wife and says when his landlord decided to sell it was time to start looking.

The couple had looked at about 12 properties and while some of them were ''horrific'' they knew they would have to put their best foot forward when the right one popped up.

Everything about their new home was ''perfect'', he said.

''When you want something you will do your best to get it.''

The three-bedroom, one bathroom, $550 a week house ticked all their boxes.

''Fortunately, I have worked in marketing for a long, long time so I dotted the Is and crossed the Ts.''

Now the Browns and their two Jack Russell terriers were looking forward to acquainting themselves with the landlord and neighbours.

The house was rented by Tauranga Rentals.

Excellent references are just one requirement that landlords take into consideration. Photo / Getty Images