The Auckland rental market finished 2023 with a record increase in average rent price, according to Barfoot and Thompson's Quarterly Rental Update.
Auckland's average weekly rent reached $662.23 in December, up 5.27 percent from December 2022's average.
The increase is the largest year-on-year increase recorded by Barfoot and Thompson since 2015, when it spiked by 6.67 percent.
The real estate company drew its data from rents paid across close to 17,500 Auckland properties that it manages, and it includes existing and new tenancies.
The past several years in Auckland have seen relatively slow and steady increases in rent which have not been higher than 4 percent since 2017.
Barfoot and Thompson's general manager for property management Samantha Arnold said the spike "may have marked the start of a new pricing cycle".
Property pricing cycles in New Zealand typically go through a boom, then a slowdown, a slump, and then move on to recovery.
Many factors are feeding into rising demand, which is driving prices up.
Arnold said as New Zealand's largest city with two big universities, "it has also been poised for a strong recovery once the border opened, and visitors and students returned".
"More and more Aucklanders are renting, and the recent return of long-term visitors and international students to New Zealand, alongside record-high net migration, are now adding significantly to the number of people seeking a rental home," she said.
Constrained supply is also driving prices up.
The extreme weather events that hit Auckland at the start of 2023 put further pressure on housing and Arnold said, "there are too few rental properties available, and we are seeing a slightly lower turnover as tenants seek to avoid the added costs of moving and landlords seek the security of longer-term tenancies".
Rents increased the most in Auckland's CBD, rising by 9.91 percent, which brought up the average.
In December 2023, a one-bedroom apartment in the CBD cost nearly $40 more per week, and a two-bedroom apartment over $56 more per week, than a year ago.
Prices on the North Shore and in central Auckland west increased the least at 3.9 percent and 3.11 percent respectively.
