Will the election have an impact on rents?

Rent prices have been mostly flat in recent years, but is the approaching election likely to change that?

Data from Stats NZ shows that the "stock" measure of rents, which includes existing tenancies, did not move at all over either the month or year to August. The "flow" measure of new tenancies was up 0.9 percent over a year but did not move over a month.

Asking rents were a mixed bag, too. Realestate.co.nz data showed Auckland asking rents up 1.2 percent over a year, Coromandel's down 13.7 percent, Hawke's Bay down 3.5 percent, Wellington up 3.9 percent and Canterbury and Otago up more than 5 percent.

Cotality head of research Nick Goodall said he did not think the election was likely to change the picture much.

"The thing I'll be looking for is who is going to impact living costs and the broader economy.

"At the moment, the reason the rental market is quite flat in terms of rents not going up anywhere is because we have this imbalance between demand and supply, which is playing out in tenants' favour because there are fewer people out there looking for rental properties and there is quite a bit of supply in terms of rental properties available for rent."

He said more people were living with their parents for longer, or staying in larger flatting situations because of the cost of living.

"You don't necessarily have the household creation rate that we might otherwise when things are a bit better economically and from a cost-of-living perspective."

Policies that addressed supermarket, power and petrol costs were likely to have more of an impact on the rental market if they helped improve household finances than the tax policies that applied to housing itself.

Goodall said he expected rents to stay flat for some time. "I think it's probably quite similar to the broader market, where when things improve economically, when the labour market improves and we see unemployment start to fall as well, that's when I think we might start to see people move out to new household situations again … probably quite similar to the broader market where we're expecting values to continue to track sideways or slightly down for the rest of this year, maybe into early next year.

"When certainty comes back and then once we see some economic growth come through too, I suspect that'll then flow on to the rental market as well."

He said, although investors were generally pleased that Labour had said it would not again phase out their ability to claim interest costs as a business expense, rents were driven more by demand and tenant income rather than landlord costs.

Infometrics principal economist Nick Brunsdon agreed rents were unlikely to move quickly, whatever happened politically.

"We are picking migration to pick up ever so slowly which I think would probably get metro rents back into positive territory but probably not substantially. We don't really have the conditions for it. We've had really strong house building going on in the last boom while interest rates were low. We're actually still building quite a lot of houses at the moment. Those factors help keep a strong supply coming through, which will limit the extent of rent increases."

He said rents had been mostly flat since the spike in 2024, and had been falling in the past nine months.

Healthy Homes rules had increased the standard of rental properties, and that system was still bedding in, he said. "I'm not saying it's perfect but I think we have generally raised the quality of houses and the conduct related to landlords from where it has been historically. I think there has been a permanent shift on the relative power between tenants and landlords."

He said rents were not driven by house prices but demand for rental properties. "The two can move separately."

Tenants' incomes were the biggest factor in rent changes. "For example when the Government increased the student allowance back in the 2010s we saw in Wellington, which is quite a student-oriented rental market, rents increasing by pretty much the amount that student's incomes had increased."