New rental inflation measure shows rising prices in March

Thursday 11th April 2019

Stats NZ's new way of measuring rental price inflation shows it accelerated in March.

The new measure draws on Ministry of Business, Innovation and Employment tenancy bond data, replacing a quarterly survey of landlords, and will feed into the consumers price index.

The 'stock' measure shows rental price changes across the entire renting population, whereas the 'flow' measure only captures dwellings that have a new bond lodged against them.

The national stock rental price index rose 3.4 percent in March from the same month a year earlier, edging up from an annual pace of 3.3 percent in February. It rose 0.3 percent in March from February.

On the flow basis, rental prices rose 5 percent in March from a year earlier, with Wellington rents up an annual 9.6 percent, the biggest increase across the nation. Auckland rental prices rose an annual 3.7 percent and Canterbury rentals were up 2.6 percent.

Across the rest of the North Island, rental prices were up 6.6 percent in March from a year earlier, and for the rest of the South Island, prices rose an annual 4.1 percent.

Stats NZ has said the flow measure is comparable to online listings site Trade Me's property rental index, and is useful in showing turning points in the market, whereas the stock measure aligns more closely to CPI.

Trade Me's February property rental index showed a 5.3 percent annual increase in the median rent for all properties nationwide at $495 a week.

Trade Me's survey, which draws on advertisements on its site, showed the increase was more marked for one- and two-bedroom properties, which registered a 9 percent jump in rents to a record $425 weekly median rent.

(BusinessDesk)

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