Tenants can expect another blow to their budgets, as a new survey reveals most landlords are planning to raise their rents.
Independent economist Tony Alexander found landlords' desire to increase rents rose in the past couple of months, as reported in his latest October investor insight survey compiled with Crockers Property Management.
The report found 74 percent of respondents plan to raise their rents in the next six months. While this number is only up one percent from last month, it is a rise from 65 percent of respondents in Augusts.
Most landlords planned to increase rent by five percent, which is notably lower than inflation currently running at 7.2 percent.
The report found the average planned rental price increase had broken a previous downward trend.
Alexander said while the number of landlords planning to increase their rent is up, they still remain below levels seen in the survey before July.
"Had the trend continued downward we could have expressed some optimism with regard to a decline in the overall inflation rate for the country. But that optimism (from a borrower's interest rate point of view) had best be kept in check for now," Alexander said.
The survey insight comes amid calls for the Government to implement a rent freeze as Kiwis grapple with the cost of living crisis.
The latest Trade Me data found the national median weekly rent increased by 7.5 percent year-on-year last month, slightly higher than annual inflation. The national median rent was $575 in September.
However, real estate firm Barfoot and Thompson has predicted rent increases could ease in the coming months as properties are needing a reduction in price to meet the market.
"People are grappling with very tight budgets and property owners will be recognising the importance of a shorter vacancy and a sustainable tenancy over [a] higher yield."
