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Corelogic Invercargill

Kelvin Davidson, Senior Property Economist, Corelogic


1 August 2020

The Data

Rental data is sourced from the Ministry of Business, Innovation and Employment based on rental bonds lodged. This 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 property 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 property value calculated using our E-Valuer.

Market Composition

Invercargill’s rental property market is predominantly houses, although it also has a reasonable number of flats. Apartments are a small segment. Of the 232 properties recently on the market in Invercargill, 73% have been houses (170), 22% flats, and just 4% apartments. Suburbs had 138 of those overall properties, with 127 houses (92%) and 11 flats (8%). It has no apartments.

The Central Invercargill/Bluff market is smaller, with 94 properties recently on the rental market, but it has a more even spread of types – 43 houses (46%), 41 flats (44%), and 10 apartments (11%).

House Size, By Bedroom Count

Looking at houses specifically, Invercargill’s rental market is dominated by three-bedroom properties, with no one-bedroom or five-bedroom properties having recently been on the market.

Within the three-bedroom category in Invercargill, 119 properties have recently been on the rental market (70% of the total) – it’s typical across most of the country for the rental house segment to be dominated by three-bedroom properties.

Most of those have been in Suburbs (89). Indeed, in that part of Invercargill, about 70% of the rental house stock is three bedrooms. In the four-bedroom category (9% of recent Invercargill houses on the rental market), all of those 15 properties have been in Suburbs. In other words, Central Invercargill/Bluff has had no four-bedroom rental houses recently on the market. For two-bedroom rental houses, the concentration is higher in Central Invercargill/Bluff (30% of recent houses on the rental market) than Suburbs (18%), although Suburbs has had more properties recently on the rental market (23 and 13 respectively).

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 in Invercargill are pretty tightly bunched, at $340 in Central Invercargill/

Bluff and $360 in Suburbs. However, Suburbs has the higher median value for three-bedroom houses, at more than $361,150 – comfortably above Central Invercargill/Bluff’s $323,050. The result is that gross rental yields for three-bedroom houses are higher in Central Invercargill/Bluff (5.5%) than Suburbs (5.2%). However, by national standards, any suburb with a yield of more than 5% is still pretty attractive.

Consistent with strong property demand in Invercargill in the past few years, both house prices and rents have risen especially in Suburbs, where the rise in three-bedroom house rents in the past year has been in excess of 8%.


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