Rental crisis: Situation 'terrible' in Gisborne
Even the national body representing property investors is shocked at the “terrible” state of Gisborne’s rental market, with less than a handful of houses.
Trade Me website yesterday had just four rental vacancies listed in central Gisborne, two of which had only one bedroom.
“There is definitely a shortage of properties and a huge demand,” Gisborne letting agent Emma Brown said.
“Over the past year or so we have seen a lot of people from out of town finding Gisborne to be a great place to live and work, and making the move here from the larger cities.
“We have seen a number of our investment properties selling due to legislation changes, which are making things harder on landlords.
“The upside of this is that a lot of these properties are selling to local first-home buyers through KiwiSaver. “We are seeing rents increasing steadily so expect to see more investors return to the market, which will in turn increase the number of properties on offer.”
Tenancy data from the Ministry of Business, Innovation and Employment shows the number of active rental bonds in Gisborne last month fell to 3156 — 33 fewer than in December 2017.
Simultaneously, the average mean rent in the district rose from $287 a week to $332.
New Zealand Property Investors’ Federation president Sharon Cullwick said the situation in Gisborne showed what happened when the Government “puts the squeeze on landlords”.
“I didn’t realise the situation was so bad in Gisborne — it’s terrible.
“It’s amazing but I suppose that’s what happens when they start putting the squeeze on landlords to make it better for tenants. It’s a good thing but ultimately it means more landlords are not getting into the market, and more of them are now taking the opportunity to leave.”
While the average age for landlords was over 55, many of those were looking at exiting the market because it was becoming too hard to keep up with costs through new government regulations.
'It is hard to see a solution'Cullwick said it was hard to see a solution.
“I guess because there are so many more regulations on landlords, landlords have decided to exit in favour of first-time buyers.”
However, that brought its own issues for renters and housing stocks.
“We know for every first-time buyer of a house, it takes two houses to house all the tenants because there are more people who live in a rental house than would do so in an owner-occupied house.
“I don’t know what we can do because we can’t build houses quickly enough.
“The Government really does have to lay off landlords. They need landlords to provide housing because the Government can’t buy enough housing. It’s also cheaper for a landlord to own a house than for the Government to own a rental property.
“They shouldn’t be so hard on landlords if they want landlords to help them out.
“ If they don’t, there will be more people who end up being unable to find rental properties and end up living on the street.”
Home Rental Services managing director Graham Faulkner said the situation was the worst he had seen.
“We had two properties available and both had been de-listed this morning, and that leaves us with nothing.
“It was nearly as bad as this a year ago but then it recovered after the Christmas break, but this year it has not.
“The biggest problem is the lack of the cheaper, more ordinary three-bedroom-type family homes that used to be out there in reasonable numbers up until about three years ago.
“They are just not available now.”
There were a “whole range” of issues behind the lack of houses, including Gisborne’s increasing population.
“Almost every day I am seeing new people coming in, or people coming back to Gisborne who have been out of Gisborne for years, and that’s just adding and adding to the shortage.”