The recent launch of the Build to Rent (BTR) tracker* signifies the Property Council New Zealand’s ability to measure the status of this new housing model. Produced in collaboration with JLL, Colliers, Savills, CBRE and Bayleys, the purpose of the tracker is to monitor the quarterly advancements of BTR projects and highlight opportunities to provide long-term rentals across New Zealand. 

As of December 31st 2023, there have been 1,307 BTR homes delivered across New Zealand, according to research conducted by Property Council New Zealand. There are 850 BTR homes under construction and a further 3,395 in the development pipeline.

“We see huge opportunity for Build to Rent to help alleviate the pressure on rental markets in places like Queenstown, Wellington and Tauranga”

^{-Leonie Freeman, Chief Executive, Property Council New Zealand}

“While Auckland is certainly leading the way with 1,096 units completed, a further 742 under construction and 3,350 in the development pipeline, we see huge opportunity for Build to Rent to help alleviate the pressure on rental markets in places like Queenstown, Wellington and Tauranga”, says Leonie Freeman, Chief Executive at Property Council New Zealand.

BTR properties are medium- to high-density, multi-unit residential developments typically owned by institutional investors or developers and managed by specialist operators. They are generally located in city centres within walking distance of key transport links, but can also be located in the regions.

A hallmark of BTR is professional management, with amenities such as lounges, gyms, and lobby cafés often available onsite. It is a paradigm shift — the tenant becomes the customer, and the rental is the service. Amenities like on-site maintenance staff, lounges, gyms, and lobby cafés are attractive drawcards.

“It is a paradigm shift — the tenant becomes the customer, and the rental is the service. Amenities like on-site maintenance staff, lounges, gyms, and lobby cafés are attractive drawcards.”

This paradigm shift where the tenant is the customer may lead to significant improvements in tenant satisfaction. The Ministry of Housing and Urban Development’s website seconds this, stating: “Benefits include enabling significant dedicated rental supply, including of the most-needed typologies, enabling affordability and providing better tenant experiences and wellbeing outcomes.”

According to The Property Council of New Zealand, another longterm benefit of BTR is a sustainable approach to housing, with a focus on achieving positive environmental outcomes: “This is often reflected in sustainable approaches to construction as well as a focus on achieving high Homestar and Greenstar ratings. One way of reducing our emissions is to encourage high quality intensification of our housing supply.”

The main legislative hurdles to greater investment in BTR are the Overseas Investment Act and depreciation settings.

“The more certainty we can give potential investors, the more likely they are to invest in Build to Rent in New Zealand, and the more housing options renters will have.”

^{-Leonie Freeman, Chief Executive, Property Council New Zealand}

“From a legislative standpoint, we believe we are more than halfway to truly unlocking Build to Rent in Aotearoa. Last term saw the establishment of an asset class and the restoration of interest deductibility. The new government has recently honoured their commitment to introduce amendments to the Overseas Investment Act into Parliament as soon as possible. Alongside this, access to depreciation for Build to Rent properties and ensuring the Residential Tenancies Act is fit-for-purpose remain crucial.

“At the end of the day, it’s all about certainty. The more certainty we can give potential investors, the more likely they are to invest in Build to Rent in New Zealand, and the more housing options renters will have. This goes for both overseas investors and hardworking Kiwis whose KiwiSaver funds are invested in the sector — it really is a win-win-win situation”, says Freeman.

Find out more here.

^{*For the purpose of this tracker, The Property Council of New Zealand has defined Build to Rent as “purpose-built or adapted long-term rental developments”. They are tracking developments of over twenty units (as per the Government’s definition) and under single management. This includes purpose-built or adapted rental schemes owned or managed by a Community Housing Provider or Iwi, for the market. Excluded are most developments built prior to 2018, any development with communal kitchens, any development that is Council owned or leased, or sold to or leased out to Kāinga Ora – Homes and Communities, as well as any hotel rooms or serviced apartments. Figures are current as of 31 December 2023.}