The rental market – particularly in Auckland – has been bucking the trend of falling prices and low sales as “a whole new generation of renters have left home ownership behind.”
The Crockers Property market research for December has shown that while median sale prices and sales volumes both took a plunge in December, three-bedroom rentals are more than 5% higher than in December 2009.
Rentals for three bedroom properties have fared better than cheaper two-bedroom homes, where rents only rose 1.5% above 2009 levels.
Crockers cited the tight home ownership market, high interest rates and increased mortgagee sales for the growth in three-bedroom rents, creating a "whole new generation" of people priced out of home ownership and moving into the rental sector.
Outside of Auckland however, Crockers found the trend reversed, with rental levels for two-bedroom properties up almost 4% on last year, while the three-bedroom market saw a modest 1.8% rise.
"This probably reflects larger average household sizes in the Auckland region, particularly at the lower socio-economic end of the market, where fewer householders own their homes," the report said.
The figures tally with data from the Department of Building and Housing (DBH), which found that over the year to December 2010, nationwide the average weekly market rent for a two-bedroom property rose by 4.9% to $302.
For three-bedroom homes, the rise was 1.8%, up to $332.
The DBH figures also confirmed the Auckland trend.
In the year to December 2010, average rents for new tenancies rose by 2.5% to $325 per week (1.9% increase in 2009), while over the same period Central Auckland rose 4.2% to $420, North Auckland rose 3.1% to $429 and South Auckland climbed 2.5% to $376.
Over 2010 as a whole Crockers characterised the housing market as sluggish - sometimes even dormant.
The report said that Auckland was the best place to be a property owner over 2010, largely because of a few outstanding months that lifted the city's averages for the year.
In general though, prices moved little in major centres, while rental levels showed small upwards movement.