A new app to enable tenants to bid against each other for a property will drive up already barely affordable prices, renters say.
The US-based app Rentberry describes itself as a "price negotiation platform uniting tenants and landlords".
Rentberry says its app is a one-stop shop. Renters say it will drive up the cost of leasing a property. Photo: Supplied
It is one of a number of rental apps poised to enter the Australian market and New Zealand soon after.
Chief executive Alex Lubinsky said it was a one-stop shop putting all the aspects of finding and leasing a rental in one system.
"Tenants can search for properties, they can analyse competition, find out how they fit in terms of the competition and customise offers based on the personal criteria and needs."
"[For landlords] we automatically also pull credit reports, do background checks and do criminal reports on every single applicant.
"It allows for the landlord to get the true maximum rental price for his property, and this is the right of the landlord."
There are several other rental apps poised to launch in Australia including LiveOffer, where prospective tenants fill out forms which are ranked for the landlord to choose; and Rentwolf, where tenants set up profiles, then apply for houses through the site.
Kayla Healey of Renters United said such apps could drive up rents.
"If it does come here and it is successful it's going to drive rents up even higher in a market that renters can already barely afford."
"I think it's dangerous because I think out of desperation people are going to offer more than they can afford."
She said there was also an issue of fluctuating prices at different times of the year.
"The full maximum price for the property at certain points of the year is not going to be the full maximum price at other points of the year.
"I think this is just really going to exacerbate the problem that we already see happening in January.
"Already around that time of year we see rents going up by $50 to $80 on average [in Wellington].
She said a move towards app use could also disadvantage older people in the rental market.
However, Mr Lubinsky said it was not necessarily the case that the system would encourage people to pay more than they otherwise would.
"Some people say auction implies that the prices always go up ... in our case, price is not necessarily going up because in our case landlords - they are not after an extra forty bucks, fifty bucks in many cases - they are after quality tenants.
"So they are looking for the most quality individuals. So should this person pay more than everyone else or should this person get a discount?
"Eighteen of those individuals might offer more money but they will be less qualified in the eyes of the landlord.
"So the [better behaved] tenants can get, essentially, a discount.
Property Investors Federation executive officer Andrew King agreed.
"There is a quality of tenant and price is not the only thing you're looking at," he said.
He said property owners were feeling attacked.
"Rental property owners have been attacked basically as being ruthless people and not paying their fair share of tax and doing everything wrong.
He said over 90 percent of landlords in New Zealand had just one or two properties, and very few had more than five.
"If we keep going along the way we're going I think we're going to lose a lot of these ma and pa investors who are there at the moment," he said.
Mr Lubinsky argued it was not down to landlords or the Rentberry company to regulate the property market.
"The owner of the property - it's his or her property, they paid millions and millions of dollars for it in some cases - and it's their right to rent this property to whoever they want to at a price whichever they want to.
"At the end of the day ... the government's supposed to build more houses, the government's supposed to make legal systems much easier for the companies to be able to build properties easier in some markets ... maybe build some housing that's available for those who make less money and things like that."
