It can be difficult to predict future residential rental prices with the sudden surges and dives in the market. However, there are ways to determine how often rent can be raised.
For Whangarei rentals, the law does not limit the amount of a rent increase. However, it can only be increased if the tenancy agreement allows this. One reason that landlords increase rent is the cost of living. As the overall cost of living increases, so will your rent. This, however, is usually a small percentage increase and can be expected annually.
Another is maintenance and improvements. When landlords upgrade the property by installing security, heat pumps and alike, these costs can be passed on to the tenants. While it may, at times, seem like a financial burden to tenants, these improvements could be beneficial in the long run. Furthermore, the improvements will make the rental property more valuable.
Lastly, landlords may raise the rent as taxes rise. If there is an increase in income and property tax, rents may raise the rates to balance out losses.
For rentals in Whangarei, here is a comparison of the rental ranges and median in January 2019 and August 2020:
Note: These ranges are from the market rent statistics calculator. The information comes from bond data and does not include any area with fewer than five bonds lodged.
As shown in the ranges, prices have more or less increased. The average lower rent in Whangarei in January 2019 increased by 11.51% in August 2020. Median rates have increased by 11.16% and upper rates by 9.73%.
For landlords, this primarily indicates that the rental yield has increased. On the other hand, this could also be signs of market changes, inflation, and property maintenance costs. However, you need not worry if you are looking for a Whangarei rental. Landlords have specific rules to abide by should they decide to increase rent.
First, landlords have to take into account the type of tenancy and market trends. As a tenant, you can do your part in being vigilant by understanding your rental rights. Your rent cannot be raised if you are in the middle of your lease. Landlords will have to wait until you’re nearing its end, except for cases when the lease is month to month.
Second, your rent can only be increased after the first 180 days of the tenancy. Your rent can only be increased for a fixed-term tenancy if the provisions in the fixed-term tenancy agreement allow this. You can agree to an increase outside the usual 180-day period if the property has been improved and it dramatically benefits you as a tenant.
Lastly, the landlord must give you a minimum of 60 days’ written notice of a rent increase. The notice must state how much the rent is increasing and the day it is due. Moreover, this notice must be served in writing.
Bonus info: Returning the rent to normal after your landlord has reduced it for a period of time is NOT a rent increase.