Industry expert Greg Owen has spoken out on the lack of luxury short-term rental properties in the local accommodation sector.
New Zealand’s luxury residential rental sector is failing to keep pace with the surge in global demand, with agents warning that half of all high-net-worth travellers seeking premium stays are being turned away due to a chronic shortage of suitable properties.
Industry experts warn the growing shortage could undermine the success of upcoming foreign buyer policy changes, as wealthy individuals often rely on extended stays to experience local life before committing to multimillion-dollar investments.
Greg Owen, co-founder of accommodation agency Stay Luxe, said the supply constraints on the market have reached a tipping point.
He said, despite fielding up to 50 enquiries each week from overseas visitors willing to spend up to NZD 15,000 per night on exclusive homes and services, such as private chefs and wellness treatments, there are too few available properties.
Owen said the underutilisation of the pool of luxury housing represents a multi-million-dollar annual opportunity cost for homeowners, service providers and the wider economy.
“Many of these homes sit unoccupied for extended periods as their owners travel overseas or relocate to other centres, leaving high-value assets idle rather than contributing to the tourism economy. Unlocking that capacity is critical to the expansion of New Zealand’s accommodation infrastructure,” he said.
“We are seeing unprecedented demand from wealthy individuals and families looking for prestige residential properties with privacy, premium finishes and a level of professional management. Without a larger pool of stock, these travellers and their spending power will go elsewhere.”
Owen added the luxury stay market also provides an immersive level of suburban experience for potential investors that hotels cannot offer.
He added Stay Luxe has experienced 10 percent growth each month, reflecting a rising international appetite for New Zealand as a destination for extended, luxury stays.
“The bulk of enquiries are coming from North America and Europe, particularly Germany and the United States, where clients are often motivated by lifestyle relocation or disillusionment with conditions in their home countries.
“Many of our clients will stay for months in premium homes, experiencing suburban environments, local communities and schooling options before deciding to invest millions of dollars in a luxury property. That’s something a hotel stay simply cannot replicate,” he said.
Owen added typical stays range from three weeks to 12 months, with many clients using luxury rentals as a “try before you buy” gateway before investing in New Zealand property.
Owen added around one in ten renters ultimately go on to purchase the homes they stay in, underlining the sector’s role as a pipeline for foreign investment into New Zealand property.
He said even with dozens of managed properties in Auckland, the agency cannot keep pace with demand and when high-net-worth travellers cannot secure a suitable luxury rental, they often default to overseas-owned hotel chains.
“We could double the number of premium homes immediately just to cover current enquiries, and more coming online each week. At the moment we are turning away as many guests as we accept. Ultimately, this means homeowners are losing out, and hundreds of thousands of dollars are being lost every week.”
“That is money unnecessarily lost to the New Zealand economy. A luxury rental keeps spending in local hands, whether it’s cleaners, chefs, spa therapists, or property managers, whereas hotel profits largely flow offshore,” he said.
Owen added the spending figures highlight what is at stake.
“One current enquiry from a North American billionaire involves NZD 500,000 for a 90-day stay, with another NZD 150,000 earmarked for in-house staff, cleaning, and ancillary services.
“In another instance, a NZD 150,000 waterfront booking was confirmed online in a single transaction – without prior inspection. That shows the level of confidence these guests have in New Zealand as a destination and in the premium end of the market.
“These guests are not just booking accommodation, they are dining at the country’s top restaurants, visiting the retail precincts and exploring wider tourism experiences, the flow-on effects to the economy are significant.”
Owen said Stay Luxe estimates luxury rentals can generate two to three times the revenue of a standard long-term lease, offering property owners both income and professional property management, including regular maintenance and cleaning.
He added many owners underestimate what their homes could earn and often hold misconceptions.
“A lot of homeowners think short-term luxury rentals mean parties or high risk. In reality, our clients are corporate families or investors who take great care of the properties. Many owners are surprised to learn their homes could command NZD 8,000 a week when they might otherwise settle for NZD 2,000 on the standard rental market,” he said.
Owen said the requirements of this market are exacting.
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