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In recent times, an unexpected trend has emerged in the Auckland real estate market, driven by extreme weather conditions. Tenants are increasingly making the move to the Central Business District (CBD), away from properties near hillsides or with large sections. This shift in housing preference is applying additional pressure to an already strained market. We spoke with Rishabh Kapoor, CEO of Impression Real Estate, to gain insights into this intriguing development. Key Takeaways:

1. Weather-Induced Relocation: Extreme weather events have become a significant factor influencing tenant decisions. People are opting to live in the CBD to avoid areas prone to flooding and other weather-related hazards. The slow response of insurance companies to resolve such issues has added to the motivation for this shift.
2. Pressure on the CBD Rental Market: Contrary to expectations, the CBD rental market is facing increased demand. Initially, there was a shortage of supply during the pandemic due to the absence of international students, migrant workers, and young professionals. However, the situation is evolving as people return to the country, seeking more affordable housing options in the CBD.
3. Consolidation and Cost Reduction: Rising interest rates and the escalating cost of living have driven individuals to consolidate their living arrangements. This trend has led to a preference for smaller spaces with reduced liability.
4. Challenges for Migrants: Migrants looking for housing face challenges, as they must physically view properties before signing leases. While demand is high, newcomers often need to see the properties in person, which can be inconvenient.
5. Competitive Rental Market: Migrants unfamiliar with local customs have been offering higher rents than advertised, creating a competitive rental landscape. While this may seem advantageous for property owners, it can pose challenges for tenants.

The Auckland real estate market is witnessing a unique phenomenon where weather-related concerns are driving tenants to seek refuge in the CBD. This has resulted in increased demand for CBD apartments, challenging initial expectations. Migrants are also navigating their way through this competitive market, adapting to the local rental landscape. It remains to be seen how these factors will continue to shape the Auckland real estate scene, but for now, the industry is experiencing a shift driven by both external factors and evolving tenant preferences.

Auckland is currently facing a severe shortage of rental properties, leading to desperate measures from prospective tenants. Impression Real Estate, which manages over 1000 rentals in the Auckland region, has reported a staggering 900% increase in the number of tenants viewing each rental property in just six months, with an average of over 50 viewers per property. Several factors, including increased migration, flooding events, and domestic pressures, are contributing to this rental squeeze. Rishabh Kapoor, CEO of Impression Real Estate, expressed concern about the desperation among tenants, some of whom have resorted to offering bribes to secure a rental ahead of others. While most offers have been monetary, ranging from $50 to $100 above the advertised rent, some tenants have tried to win favor with property managers by offering dinners, gifts, or even covering property improvement costs. Kapoor emphasized the need to educate both landlords and tenants, particularly newcomers to the rental market, about their legal rights and responsibilities under the Residential Tenancies Act. Common issues include misunderstandings about maintenance and repair responsibilities. The situation is further exacerbated by an influx of migrants who are seeking rental properties in the central city. Auckland’s rental vacancy rate has dropped significantly, with high demand for CBD apartments, driven by residents displaced by weather events and migrants. In response to these challenges, Impression Real Estate has introduced artificial intelligence (AI) technology in the form of a chatbot named “Marcia.” This AI chatbot aims to assist tenants and landlords by answering common questions and providing information on various aspects of tenancy, including bond refunds, lease agreements, and finding service providers. The chatbot is available around the clock and is part of an effort to improve efficiency and transparency in the rental market. Despite the potential for additional technology, such as virtual property viewings, current government regulations may need updating to accommodate these innovations and better serve tenants, especially those moving from abroad. Key Takeaways:

1. Auckland is experiencing a severe shortage of rental properties, leading to a highly competitive rental market.
2. Desperate tenants have been resorting to offering bribes, including monetary incentives and gifts, to secure rental properties.
3. Impression Real Estate is using AI technology in the form of a chatbot named “Marcia” to assist tenants and landlords with common inquiries and improve transparency in the rental market.
4. Education about legal rights and responsibilities under the Residential Tenancies Act is essential for both landlords and tenants.
5. High demand for CBD apartments is driven by residents displaced by weather events and an influx of migrants.
6. Current government regulations may need updating to accommodate innovative solutions like virtual property viewings.

Auckland, New Zealand, is grappling with a severe shortage of residential rental properties, and the situation has escalated to crisis levels. Over the past six months, there has been an astonishing ten-fold increase in the number of people actively searching for accommodation. In this blog post, we’ll explore the pressing rental crisis in Auckland, shedding light on the factors driving this demand surge and the challenges faced by both renters and landlords. Key Takeaways:

• Auckland’s rental market is in dire straits, with the number of prospective tenants viewing each rental property skyrocketing from an average of five to an astounding 50 over the past six months.
• Impression Real Estate, a prominent rental firm managing 1000 rentals in Auckland, has been witnessing this surge in demand first-hand.
• Rishabh Kapoor, CEO of Impression Real Estate, emphasizes that this rental shortage is intensifying pressure on the inner-city property market. The demand for central city apartments has surged, primarily driven by individuals who lost their homes due to storms earlier in the year and recent migrants.
• Kapoor notes that recent weather events have prompted many clients to seek refuge in the central business district (CBD), avoiding properties with large sections or proximity to hillsides vulnerable to slips or flooding. This influx into the CBD exacerbates the already tight apartment rental market.
• Additionally, there is a growing trend of downsizing from larger family homes as homeowners struggle to afford mortgage payments in the face of current interest rates.
• Desperate tenants are offering $50 or more per week above the listed rental price, and some have even resorted to bribes in their quest to secure a rental ahead of others.
• Rental prices have surged by approximately 5 percent over the past six months, adding to the financial burden for renters.
• The Tenancy Tribunal has witnessed a significant 43 percent monthly increase in the number of applications, with over 2100 applications being processed.
• Kapoor highlights that the rapid growth in demand, particularly from newcomers to renting, has left many tenants unfamiliar with current industry regulations.
• Impression Real Estate is taking innovative steps to address these challenges, including the use of an AI chatbot to assist tenants and landlords with a wide range of questions. This technology is particularly beneficial for overseas tenants who may not be well-versed in local legislation.

In summary, Auckland’s rental market is facing an acute crisis, characterized by a ten-fold surge in demand and skyrocketing rental prices. The situation is further exacerbated by a lack of rental properties, prompting desperate measures from tenants and a surge in applications to the Tenancy Tribunal. As the rental landscape evolves, innovative solutions like AI chatbots are emerging to support both tenants and landlords while the city grapples with this unprecedented challenge.

A growing shortage of rental properties in the wake of increased migration and recent weather-related events is pushing New Zealand’s rental market to a crisis point, according to new data. In this blog post, we’ll delve into the details of this pressing issue, shedding light on the challenges faced by both tenants and landlords. Key Takeaways:

• The number of prospective tenants viewing each rental property has surged by a staggering 900%, with an average of over 50 viewers per property in just six months.
• Rental prices have surged by approximately five percent over the same period.
• The CEO of Impression Real Estate, Rishabh Kapoor, highlights the strain this shortage is putting on the inner-city property market. Desperate tenants are even offering up to $50 per week more than the listed price and, in some cases, resorting to bribes to secure a rental ahead of others.
• The high demand for CBD apartments is primarily driven by individuals who lost their homes due to storms earlier in the year and recent migrants, leading to a surge in first-time renters who may not be familiar with industry regulations.
• Kapoor emphasizes the need for better education of both landlords and new tenants regarding their rights and responsibilities under the Residential Tenancies Act.
• Ministry of Justice research reveals a 43% increase in applications to the Tenancy Tribunal compared to the same period last year, with an average of more than 2100 applications each month.
• Impression Real Estate is pioneering the use of artificial technology to aid tenants in finding properties and educate both tenants and landlords about their rights. The technology features a chatbot named “Marcia,” which provides assistance and answers common queries, making it especially valuable for new migrants in different time zones.
• Kapoor stresses the importance of technology as part of the solution, but the company urgently needs more than 120 additional homes or apartments to meet market demand.
• Recent weather events have prompted some clients to seek CBD rentals to avoid properties with large sections or proximity to hillsides, which could be susceptible to slips or flooding.
• Downsizing from larger family homes due to affordability concerns is also contributing to the demand for rental properties.
• Kapoor envisions further technological innovations, such as virtual property viewings, but acknowledges that regulatory updates would be necessary to support these advancements.

In conclusion, New Zealand’s rental market is facing unprecedented challenges driven by increased migration and weather-related events. The shortage of rental properties is straining both tenants and landlords, necessitating innovative solutions and potential regulatory changes to accommodate evolving needs in the rental sector. Impression Real Estate’s use of artificial technology, represented by “Marcia” the chatbot, is one step towards addressing these challenges and providing valuable support to the growing number of renters in the market.