The Dunedin rental market saw no change in median weekly rent year on year, with the December 2022 median at $450. The number of bonds lodged in December decreased from 480 in 2021 to 384, likely, in part, because of the increasing number of tenants taking advantage of the amendment to the tenancy laws allowing fixed term tenancies to roll over to periodic tenancies. The average number of rental listings available on TradeMe as of writing this report is 314 which is up from this time in 2022.
Our internal data backs up the trend of increasing numbers of renewals with 8 tenancies re-signed, aligned with this time in 2022. Properties are still attracting good interest with our average time to let at 23 days. Tenants are becoming more discerning but many are looking at properties with more of a long-term view meaning that well presented quality properties are attracting quality tenants.
As the local investment market comes off the back of a very quiet year of transactions, there are some positives for those considering expanding their portfolio:
- Some economists are picking that we are nearing the end of the rapid rise in interest rates and forecasting stabilisation, providing some comfort to those holding mortgages or looking to take on further borrowing.
- Developers have recognised the need for new rental housing in Dunedin, taking advantage of zoning density changes and allowing investors to benefit from the recent deductibility rules as they apply to new builds.
- Investors are finding good value in the market again with increased rents and downward pressure on prices creating appealing yields.