Gentrified Suburbs: Why Renters Are Disappearing

Census data indicates that a recent building boom in New Zealand has significantly altered the demographic composition of several suburbs, leading to a marked decrease in the proportion of renting households over the last decade.

The shift toward owner-occupancy is most pronounced in areas where new housing developments have expanded the total number of available homes. According to Shamubeel Eaqub, chief economist at Simplicity, these new developments have changed the character of suburbs, as the individuals moving into these new properties tend to be owner-occupiers.

Suburban Shifts in Auckland and Beyond

Several suburbs have seen dramatic drops in their renting populations between 2013 and 2023. In Auckland’s Penrose, the percentage of renters was 56.7 percent in 2013 and 52.5 percent in 2018, before falling to 27.8 percent by 2023. This change coincided with a more than doubling of the total number of homes in the area, which rose from 201 in 2013 to 453 in 2023.

Similarly, Hobsonville in Auckland experienced a decline in its renting population from 43.8 percent in 2013 to 24.8 percent by 2023. During this period, the number of homes in the suburb increased from 576 to 4,956.

The trend is also evident in other regions of the country:

• In Ruakura, Hamilton, the percentage of renting households dropped from 50 percent in 2013 to 27.6 percent by 2023, as the number of homes grew from 84 to 729.
• In Wharewaka, Taupō, the renting population fell from 32 percent to 12.2 percent over the same ten-year period, while the number of homes increased from 309 to 639.

Gentrification and Market Dynamics

Eaqub describes this process as gentrification, noting that wealthy suburbs are expanding their reach. He cited Mangere Bridge as an example of a suburb that was previously viewed less favorably but has since become a perfectly desirable suburb due to its location by the water.

We’re building more homes and more people are getting into homeownership – I think that’s a good thing.

Shamubeel Eaqub, Simplicity chief economist

Regional Variations in Rental Growth

While many suburbs are seeing a decrease in renters, other areas are experiencing the opposite trend. Eaqub noted that the renting population appears to be growing in places such as Queenstown.

Specific Auckland suburbs have also seen strong increases in their rental populations. Stonefields, for instance, saw its percentage of renters rise from 12.5 percent to 28.9 percent. Other Auckland areas experiencing similar increases include Goodwood Heights and Sunnynook, while Lake Hayes in Queenstown also reported a growing renting population.