The CBD suburbs, with their many apartments, are leading the way on yield. Central West is on top: with a gross yield of 6.2% it might scrape cashflow neutral. It’s certainly going to be easier on your pocket than Herne Bay, where million-dollar property will yield -0.9% – yes, that’s a negative yield, which we don’t remember having ever seen before.
We may have hit basement bottom with yields, however, as prices sit flat over winter and rents continue to increase. TradeMe is reporting a 6.1% rent increase in Auckland, contributing to an increase nationwide of 5%. The median Auckland rent is now $520 a week.
Rents remain well out of step with prices; values continue to be egged on by low interest rates and a severe lack of listings. There’s been a lot of press recently about Auckland’s housing bubble bursting – if that happens yields should improve dramatically, but we’re not holding our breath.