Rising South Auckland residential property values fuel concerns of rent hikes

Ōtāhuhu resident Bella Johnston says if her landlord's rates go up she's expecting her rent will too. Photo / Supplied

Bella Johnston says her biggest concern about the Auckland Council's latest round of property valuations is being hit with another rent increase.

A number of Auckland's lowest socio-economic areas have been hit hard, facing rates rises of around 13 per cent.

Johnston, a 28-year-old mother of two lives in a "two and a half bedroom house" in Ōtāhuhu.

"It's a lose-lose situation for everybody," she said. "The only ones winning from this will be the council."

Johnston moved into the house last year and was paying $490 a week, until her landlord put the rent up to $550.

And she said if the landlord's rates went up, she'd expect her rent to do the same.

"It hasn't gone up yet, but I know it will."

The council's property valuations are normally carried out every three years and are used to calculate the capital values (CVs) of homes and rates. The latest round has seen an average increase in property values in the Auckland region of 34 per cent.

But in Māngere-Ōtāhuhu, property CVs have risen by an average of 49 per cent, and homeowners in the area are now looking at average rate rises of 13.3 per cent, or $346 more a year.

South Auckland homeowners will be pleased to see the capital value (CV) of their houses skyrocket, they might not be as pleased to see how much it could add to their rates bills. Photo / Supplied

In Papakura and Manurewa CVs have gone up by an average of 39 per cent and homeowners are looking at an average increase in their rates bills of 8.3 per cent.

According to the Auckland Council the suburbs which have seen the biggest increases are in areas which have undergone intensification in recent years, which has added to property values.

Māngere Bridge resident Paul Brown owns his own home and shares Johnston's concerns.

He said despite the fact he was looking at a bigger rates bill for his home, he was more worried about how it could affect others who were worse off.

"Everyone thinks their rates are too high," Brown said. "Everything is going up and no one wants to pay more, but you've just got to live with that, don't you?

"My biggest concern is what effect the increases will have on families living around here who are already doing it tough. Folk are really struggling."

He thinks rents are going to go up and people living in rental properties will be badly affected.

Manurewa-Papakura Ward councillor Daniel Newman said the Super City's latest round of property valuations on top of this year's planned rates rises would be a step too far for many households.

"Ratepayers are saying right now that the cost of living is their number one concern."

Auckland Council is already looking at an average rates rise of 3.5 per cent as part of its 2022/2023 budget, but with a targeted rate for climate change some people could pay up to 6 per cent more.

He said the latest CVs reflected the growing cost of residential housing in many former blue-collar suburbs in south Auckland.

But Auckland Council financial policy manager Andrew Duncan said an increase in a property's capital value did not automatically mean an equivalent increase in rates.

He said that would be determined by whether a property had increased more than the average for the same property type across the region.