Rental affordability improves in most regions, but pressures persist

This positive trend has contributed to improve affordability across more than half the country, although some areas — particularly Gisborne — have experienced significant deterioration.

Quarterly results

At the national level, rental affordability improved by 3.5 per cent in the three months to March 2025, driven by a 1.9 per cent drop in average national rents and a 1.6 per cent increase in average weekly incomes.

Affordability approved in nine of the sixteen regions recorded. Canterbury recorded the biggest quarterly gain (up 11.1 per cent), followed by Manawatū-Whanganui (up 10.4 per cent) and Wellington (up 5.9 per cent).

The most significant decline in affordability was in Gisborne, where rents surged by 41.2 per cent during the quarter. This sharp rise reversed the region’s previous affordability gains and made it the least affordable rental market in the country relative to income. Rent increases were also recorded in Northland, Bay of Plenty, Taranaki and Southland, though to a much lesser extent.

Report author, Massey Business School Senior Lecturer Dr Arshad Javed says it’s encouraging to see a national improvement in rental affordability but renters in high-pressure markets like Gisborne are facing increasing challenges.

“It’s a timely reminder that affordability is highly localised and needs region-specific responses,” says Dr Javed.

Yearly results

Nationally, rental affordability also improved slightly over the 12 months to March 2025. While the improvement was not uniform, income growth helped offset rent pressures in many regions.

Average weekly wages rose by 3.8 per cent over the year, with thirteen of the sixteen regions recording annual gains. The largest increases were in the West Coast (5.2 per cent), Nelson (4.1 per cent), and Hawke’s Bay (4.4 per cent). These income gains helped soften the impact of rent increases and supported moderate improvements in affordability.

Gisborne again stood out for the wrong reasons. The region recorded the largest annual rent increase — up 10.5 per cent — driven by sharp spikes in the most recent quarter. In contrast, the West Coast recorded the most significant annual rent decrease (down 6.9 per cent), contributing to its position as the most affordable rental region.

General trends

The report highlights a growing gap between regions where affordability is improving steadily and those facing persistent or worsening challenges. Nine regions remain less affordable than the national average, including Bay of Plenty (116.5 per cent), Tasman (117 per cent), and Gisborne (135.1 per cent). In these areas, rents remain high relative to incomes.

Meanwhile, the West Coast (82.8 per cent) and Southland (88.6 per cent) continue to be the most affordable places to rent, with lower housing costs relative to average earnings.

The Rental Affordability Report is produced quarterly by Massey University’s Real Estate Analysis Unit, based in the School of Accountancy, Economics and Finance | Te Kura Huinga Tahua.

Read the full Rental Affordability Report – June 2025