Sharings back as city rents spiral upwards
March 26th, 2008, 9:48 pm Hobbies News
The cost of renting a home in Invercargill has risen 18.7 percent in the past year — more than anywhere else in the country, a Massey University study shows.
The median weekly rental in Invercargill rose from $160 in February last year to $190 in February this year, the study shows.
The citys renters still paid the second-lowest rent in the country from those places surveyed. Only Wanganui, whose median rent was $185 a week, was lower.
However, Invercargills Jubilee Budget Advisory Service manager Sharon Soper said Southlanders paid higher power and heating prices than other parts of the country in winter and, coupled with food and petrol hikes, the rent increases were hurting many in the community.
Those on low incomes were particularly hard hit, with more than half of many incomes going on rent, she said.
%26quot;We have definitely seen a turn in people sharing accommodation because they cant live by themselves and pay $200 a week in rent.%26quot; Solo mums with children and even married couples had got boarders or overseas students in to help pay the expenses, she said.
%26quot;In a lot of cases they have made comments like they have had to put their kids in one bedroom to make way for a boarder because they cant afford to pay rent by themselves.%26quot; Real Estate Institute of New Zealand Southland vice-president Tony Jenkins said his initial reaction was the 18.7 percent Invercargill rent increase quoted by the Massey study was too high.
A large number of homes rented at the top end of the market in a particular month could distort figures, he said.
%26quot;My gut feeling is theres been a slight increase (in rentals) but I would be very surprised if its 18 percent. I still believe rentals are at a very affordable level where they are. Rentals are still fairly attractive (in Invercargill) compared to the rest of New Zealand.%26quot; There was still a good demand for clean and tidy rentals in the city, he said.
Invercargill sickness beneficiary Pam Milne said she couldnt afford to pay $150 for her small Tweed St flat so her daughter, Dena, had recently moved in to help pay expenses.
Ms Milne, 53, said she was paid $238 a week but her rent was $150, which left $88 for power, food, phone, petrol and doctors bills. Her daughters moving in had helped ease the burden financially, but it was not ideal as both wanted their independence, she said.
She had worked and paid taxes all her life and said her predicament %26quot;stinks%26quot;.
%26quot;To have to have a child support me … parents are usually there for their children. Theres definitely something wrong somewhere,%26quot; Ms Milne said.
Massey University property expert Professor Bob Hargreaves said rental costs tended to fluctuate in Invercargill.
%26quot;Clearly theres something going on in your market because house prices have gone through the roof,%26quot; he said.
As city homes became less affordable more people entered the rental market, which allowed landlords to lift rental prices, he said.
%26quot;If you have got demand exceeding supply you can push the prices up.%26quot; Wages were going up slightly ahead of inflation, he said.
%26quot;Rents typically go up faster than wages but they cant go up too fast because people cant afford them, then kids move back in with mum and dad … but that isnt happening now.
%26quot;Most people are doing okay still. Employments still too low for that.%26quot;
Related posts
