The short term housing requirements in Christchurch is difficult to ascertain with accurate data on depopulation not available. There is anecdotal evidence of residential properties coming to the sales and rental markets due to people leaving Christchurch. The reasons are varied employment relocation, job loss, seeking employment opportunities outside Christchurch and psychological reasons dealing with the ongoing aftershocks.
The only factual date we have is around availably of residential rental properties. Trademe have stated that in the first week of June 2011 there were 27% more rental properties available then pre 22 February 2011.
McPherson Property Management rental properties available are at 3.6% which is around our normal vacancy rate. The period immediately following 22 February the vacancy rate was approx 1%.
The city is a market of 2 halves, both for rental and sales. The north and west of the city rental vacancy rates are less than 1% with good demand.
The inner city suburbs certainly and eastern suburbs has a far higher vacancy rates, low inquiry 11 June 2011. Trademe had 546 residential rentals available in the eastern and inner city suburbs plus an additional 204 in the inner city.
Our concern is that the areas where temporary housing is being constructed or planned is in the same areas where there is already a good supply of existing rental properties.
We believe that some of these properties may be included in the pool of temporary accommodation. We see there is a potential to distort the rental market with a greater over supply.
I accept that too many properties seconded to temporary accommodation would create a shortage and put upward pressure on rentals.
The reality, major reconstruction is some time off. Current work is in demolition, heating replacement and residential repairs (more of a cosmetic and minor structural nature) largely from the September quake. We see evidence that some of this work is not surviving aftershocks.
The inward flow of labour for reconstruction should be less difficult to project. The hardest projection is depopulation as insurance payments diminish the steady flow of redundancies and ongoing psychological pressure of living in a disaster zone and ongoing aftershocks.
Recovery requires clear and decisive action but not knee jerk reaction. Red zone access for business, (especially records) and the camper van saga do not help morale.
The last thing we would want is mortgagee sales of residential investment properties in the eastern suburbs through vacancies while resources are poured into temporary housing. There has been an unofficial moratorium on mortgage sales but there is an end to mortgage holidays and reality will prevail.
This was written prior to today’s events 13 June 2011, the depopulation factor will only increase.
13 June 2011