Latest / Early Edition with Ryan Bridge / Nick Tuffley: ASB Chief Economist on rent prices hitting the lowest point since 2023

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Nick Tuffley: ASB Chief Economist on rent prices hitting the lowest point since 2023 · Early Edition with Ryan Bridge

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  Speaker 1: New data shows rents down three percent nationwide to the
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  Speaker 1: lowest point since twenty twenty three. New listings while you're
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  Speaker 1: drowning in them up sixteen percent nationwide in Wellington have
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  Speaker 1: more than doubled. Nick Tuffley, ASBTV conins with us this morning. Nick,
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  Speaker 1: good morning, Good morning. So basic supply and demand.
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  Speaker 2: Very much and economical lesson in that we've got not
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  Speaker 2: just more listing that have come through onto the market,
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  Speaker 2: but when you also look in the background, we've gone
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  Speaker 2: from a few years ago we had that really strong
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  Speaker 2: net immigration, rental growth really strong. Now that net immigration
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  Speaker 2: has faded to a whisper and you've got a lot
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  Speaker 2: of supply, a lot of building activity that's still brought
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  Speaker 2: new houses onto the market as well.
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  Speaker 1: What's bucking this trend which areas well.
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  Speaker 2: I think in general what you're seeing is when you're
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  Speaker 2: looking at provincial New Zealand, that's where rents have tended
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  Speaker 2: to hold up or increase. In this particular data, there's
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  Speaker 2: been a couple of areas that have done well, like
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  Speaker 2: Southland and West Coast. Now a couple of caveats theres
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  Speaker 2: when you get into a small region you get a
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  Speaker 2: little bit of noise and a bit of bouncing around.
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  Speaker 2: But those ones you've seen some strong rental growth coming through.
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  Speaker 2: But just be aware when you've only got a few
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  Speaker 2: properties on the market and you're comparing to a year ago,
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  Speaker 2: it could be a very different could be a mention
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  Speaker 2: this time, could have been at a louthouse last year
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  Speaker 2: that you're comparing to.
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  Speaker 1: Does this have a snowball effect and potentially impact house
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  Speaker 1: prices when you yield start a roading for your rental owners,
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  Speaker 1: for your landlords, then the property values start dropping too,
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  Speaker 1: and perhaps they're more inclined to sell.
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  Speaker 2: It can at the margin. I think what we've got
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  Speaker 2: to remember is is that what tends to drive rents
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  Speaker 2: over a long time. There are a lot more linked
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  Speaker 2: to income in terms of what can people actually pay,
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  Speaker 2: and less to prices. But it'd be fair to say
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  Speaker 2: when you looking at a landlord at the moment your income, yes,
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  Speaker 2: that's down, but also think about your costs as well.
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  Speaker 2: For your biggest cost, which is your mortgage, has been
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  Speaker 2: reducing a little bit, but in the background you still
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  Speaker 2: got a lot of outgoings like your rates and your
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  Speaker 2: insurance that are still creeping up.
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  Speaker 1: Nictuffley A speechief economists. For more from Early Edition with
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  Speaker 1: Ryan Bridge, Listen live to news talks it'd be from
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  Speaker 1: five am weekdays, or follow the podcast on iHeartRadio