THE DATA

Rental data is sourced from the Ministry of Building, Innovation and Employment (formerly the Department of Building and Housing) based on rental bonds lodged. This rental data is supplied to us, grouped into geographic areas based on statistical area units used by Statistics NZ for the census, and as a result do not always match well with common usage suburb names.

The rental data for each area is matched to house price information from our database to determine property prices and therefore yield. The yield is calculated as the annualised rental income divided by the median house value calculated using our E-valuer.

Market Composition

The South Auckland rental property market is dominated by houses, also with a reasonable number of flats, but very few apartments (and all of those in only one suburb, Otahuhu). Of the 611 properties recently on the rental market, 78% have been houses (479 properties), with another 18% being flats (113), and 19 apartments. It’s common across the country for the rental market to be mostly houses.

Manurewa North is the largest market for rental houses in South Auckland, with 153, followed by Manukau and Manurewa Heights (59), and Papatoetoe South (44).

In terms of the concentration of houses in the rental stock, Mangere, Otara, and Wattle Downs/Conifer Grove top the list, with 100%. By contrast, Papatoetoe North, Mangere East, and Papatoetoe West all have a house concentration amongst the rental stock of less than 75%.

Manurewa North and Otahuhu are the largest markets for rental flats (24 apiece), and as noted, Otahuhu is the only suburb with apartments for rent.

House Size, By Bedroom Count

Of the 479 rental houses recently on the market in South Auckland, only five had one bedroom (all in Manurewa North), and only 15 had five bedrooms (all in Manurewa North or Manukau and Manurewa Heights). The largest concentration (58%) is in the three-bedroom bracket, with 15%-20% each in the two-bedroom and four-bedroom brackets.

The largest market for three-bedroom rental houses is Manurewa North (101), followed by a number of suburbs with around 20 apiece, including Otahuhu, Otara, and Papatoetoe South. The highest concentration of three-bedroom properties amongst the rental house stock is 77% in Papatoetoe West, with the lowest in Manukau and Manurewa Heights (37%). Manurewa North also has the most two-bedroom rental houses (26), but Manukau and Manurewa Heights has the most four-bedroom rental houses recently on the market (17).

Rent And Yield

By matching average value to rent we can look at gross yield for three-bedroom houses in each area. Median weekly rents for three-bedroom houses across South Auckland are in a relatively tight range from $540 per week in Manurewa North up to $600 in Manukau & Manurewa Heights. However, median values for these properties differ more widely, from $616,250 in Otara up to $906,250 in Mangere Bridge/Airport.

That results in a relatively wide range for gross rental yields, from just 3.3% in Mangere Bridge/Airport, up to 4.8% in Otara. Generally speaking, gross rental yields across South Auckland are around four per cent or above, which looks attractive compared with many other parts of the Super City, and indeed many other parts of New Zealand as a whole.

That said, rental growth for three-bedroom houses in South Auckland has been low (i.e. five per cent or less) over the past year in most suburbs, although Mangere and Otara have bucked that trend – recording impressive gains of 8-9%, which has fed through to a rise in gross rental yields too.