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19-03-2012

Rental crisis hampering Christchurch rebuild

Landlords.co.nz

The Christchurch rebuild is being hampered by a severe lack of rental accommodation, according to a Real Estate Institute (REINZ) survey.

Real estate agents who manage 11,500 Christchurch residential rental properties say there is virtually nothing available.

REINZ Christchurch-based director Tony McPherson said two-thirds of those surveyed last week by the Institute said they need to re-locate tenants so repair work can be conducted on damaged homes.

"Most are finding it either 'impossible' or 'very difficult' to find alternative accommodation for tenants and homeowners who need a short-term place to stay," he said.

McPherson said typically people needed to vacate a property for between three to four weeks while repairs are conducted, and that the rental shortage is worsening as the recovery phase starts to head towards rebuilding.

"There is a huge pressure on rental accommodation in the city from people who have been forced out of the red zone, the large short term workforce in the city there to assist with the recovery as well as the normal seasonal demand from tertiary students. Motels and other accommodation houses are full restricting accommodation or tourists and squeezing incomes of those reliant on the tourism industry."

McPherson said a "circuit breaker" was needed if the rebuild of homes was to be carried out efficiently and called for a greater allocation of short-term rental accommodation by the Earthquake Commission or the Department of Building and Housing.

He also said the stock of rental property had shrunk in the last 18 months as houses have been red-zoned or sold.

The REINZ survey of members found 66% need to relocate tenants for repair work, 41% are finding it ‘impossible' to relocate tenants and either tenants need to remain in the property (35%) or are needing to move without being relocated (6%).

The shortage of accommodation is also creating upward pressure on house prices and rents in the city, with QV figures revealing Christchurch values rose 4% over the past year and are level with the 2007 market peak.

"Rents continue to rise with high demand for rental properties from people whose homes were uninhabitable due to earthquake damage, people who need to relocate whilst they carry out repairs, or from those who are moving to the city to help with the rebuild," said QV valuer Richard Kolff.

"This is making property investors look at what potential some properties now have."

Tags: reinz - tony mcpherson - christchurch

Source: Landlords.co.nz

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