Wellington

Wellington little

I invest in Wellington, so I have a lot more data on Wellington than other regions.

In contrast to Auckland, Wellington was short of private rental properties and had been for 3 years. 2021 continues this trend with a major construction effort in progress in the CBD.

However that is changing when viewed in total, Wellington has now moved to a severe shortage suddenly, having less properties than any of the last 5 years. BUT, it is not universal, check out the CBD vs non-CBD charts, oversupply in the CBD is now solid, while undersupply in the suburbs is now driving regional trends.



Rents

To Provide a comparison, I have collected the MBIE stats on Geometric Mean Rents. The Geometric Mean Rent removes variations caused by seasonal factors where more larger homes are rented in say February (students) making the mean rent rise unrealistically. The charts should look related, but MBIE data is delayed by a couple of months.


Rents in Wellington are driven by seasonal factors, especially students filling flats in January and February, where more than other times, very large homes in the central city are rented at much higher prices than the rest of the year, leading to a peak in prices that is related to home size not a trend in rents.

The clear message from this chart is that rents can be compared by month, ie take a line up the chart for any month. That makes it clear that rents in 2022 have risen suddenly by about $50pw in February and March over last year. As explained elsewhere, this is likely driven by increasing Household Income

Jonette 2011