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Update on the Hawke’s Bay rental housing market

What are tenants paying for a three bedroom home in Hawke’s Bay?

By Gill South 12 March 2024

Hawke’s Bay is one of the country’s most popular regions, especially amongst those who want to move from the big cities, ex-locals moving back home from overseas and newcomers to Aotearoa New Zealand.

If you’re new to the area you may want to rent a home before you buy. So let’s see what the rental market is doing at the moment.

In early March, a search for all rental homes in Hawke’s Bay on Trade Me Property came back with 101 listings. Which, when you think about the size of the region – a population of 178,600 in 2020 – doesn’t sound like a whole lot to choose from. And some of those listings will already be gone, pending a couple of signatures on a rental agreement, warn local property managers.

A good rental home in the region’s main towns of Napier, Hastings or Havelock North does not stick around. Trade Me Property data shows that in Hawke’s Bay, median days on market between December 2023 and February 2024 was 14 days, compared with 19 days in Auckland and 18 days in Wellington.

Trade Me Property’s latest Rental Price Index says that the median rent for a three bedroom home in Hawke’s Bay is $670 while two bedroom homes are commanding rents of $500 a week.

How tough is the competition and for what kinds of homes?

In the Hawke’s Bay rental market, a new listing will typically attract around 40 groups to view the property, so the competition is intense. Tenants are advised to be on the ground when they start their search in earnest so the property manager or property owner can get a good sense of you and any fellow tenants

Ray White Napier property management agent, Ian Dickinson, says the region is attracting a large number of immigrants. He estimates of the tenants he meets, around 75%, are new to the country, from Sri Lanka, India, South Africa and the Philippines, all finding work in Aotearoa New Zealand.

“There’s many more people but the rental stock hasn’t increased,” he explains.

His tip to tenants anxious to find a property in Hawke’s Bay is to make personal contact with property managers like himself. “I want to meet them face to face,” he says. He appreciates people who make the effort of coming into the office and introducing themselves.

Mel Parsons, property manager with Property Scouts agrees there’s very high demand for rentals in Hawke’s Bay and it’s been like this for over five years, only slowing down around Christmas.

The most popular type of rental home is a three bedroom home for between $600 and $700 a week, she says. And Havelock North and Taradale are popular for families as they have good schools.

Rents have gone up in the past year because insurance for landlords in the region has doubled or tripled and rates have gone up thanks to a cyclone charge, warns Mel. Landlords are also having to spend on bringing their properties up to healthy homes standards.

Showing you’re financially capable will help you compete

Tenants have to be clear how many will be living in the home, says David Pearse, director of Pukeko Rental Managers. If the owner says four can live in the home and six of you show up, he will obviously have some questions.

When choosing a new tenant for a rental property, David brings together the best four or five applicants and sits down with the owner so they’re part of the decision.

“For the ones we present, we’d be happy to have any of them. Around 25% to 30% of applications don’t have the financial income where we’d be confident that they’d maintain the rents,” he says.

“There’s huge demand and I wish I had more properties but we just don’t,” he adds.

Tenants with great references will win

Due to such strong demand for rental homes in Hawke’s Bay, especially in the wake of Cyclone Gabrielle a year ago, Bayleys has just launched a new property management business called Bayleys Key Rentals after buying a local rental portfolio.

Director of the new business, Suz Hall, says Hawke’s Bay is one of the most sought after provinces in Aotearoa because it offers such a great lifestyle.

“People are coming to enjoy all that Hawke’s Bay has to offer which includes world-renowned wineries, outdoor pursuits, education, hospitality and job opportunities,” says Suz.

Popular towns for families who want to live near good schools include Central Napier, Hastings and Havelock North, says the Bayleys director.

For couples wanting to downsize or work from home, they tend to go for rentals in Havelock North, Napier Hill, Ahuriri and Parklands, she says.

The way tenants can compete for a rental home comes down to having great references, the Bayleys director advises.

“Landlords are spoilt for choice in most areas of Hawke’s Bay and don’t have to offer the property to the first applicant,” says Suz. “The more the tenant is willing to share about themselves, and who will be living at the property, the better,” she adds. “And most importantly, if they’re living locally, they should meet us in person and view the property, they shouldn’t just send in an online application.”

Where property investors are buying in Hawke’s Bay

Property managers and sales agents are expecting more landlords to enter the Hawke’s Bay market in 2024.

Sharon Cullwick, Hawkes Bay Property Investors’ Association president and, as a local landlord, keeps a close eye on the market.

To landlords she recommends Havelock North, Hastings or Napier as the most popular places to live for tenants, so those are good locations for investors to buy.

Taradale, a suburb of Napier, is very central, and has traditionally had the highest amount of rentals in the area, says Sharon. Taradale has good shops, a popular Pak ‘n Save and there’s new housing to come with 700 homes being built up behind the suburb. Another 700 new houses are also coming to Havelock North and 450 in Flaxmere, she adds.

Kristen Hines, a sales agent with Bayleys and a landlady herself in Hawke’s Bay, is currently selling an older investment property in Taradale for a client.

The three bedroom, one bathroom home needs some work but has great bones and is attracting both first home buyer and investor interest, she says. The property would be easy to rent out with its proximity to the East Institute of Technology and would suit both students or families, she says.

In its current state it would rent out at $480 to $530 a week but with quality renovations the rent could go up to $640 to $675 a week, she says.


Gill South
Gill South