Gross rental yields for lower value properties were at 4.2 percent last quarter on the strength of a 9 percent jump in rental prices for lower quartile rents, according to data from Corelogic and government's tenancy services.

Reinforcing that cheaper properties tend to carry a higher yield for investors, median-priced properties returned 3.7 percent while upper end rentals were at 3.4 percent for the quarter.

Corelogic property economist Kelvin Davidson said while the yields still look favourable against a borrowing cost of 2.5 percent and 1 percent return on a term deposit, future returns "might be crimped by new measures such as tighter loan-to-value ratio rules and potentially an extension to the brightline test."

Latest bonds data also reflect an uptick in rental pricing, with rents for the quarter up overall by 8 percent year-on-year at $480-a-week, from $445 at December 2019.

The year started strongly too, with Trade Me reporting median weekly rentals of $615 in Wellington, outpacing even Auckland which was at $590-a-week last month.

Property sales director at the online auction site Gavin Lloyd said January and February were typically busy for the Wellington market. "Lots of tenancies come up for renewal at this time of year and students start looking for a flat for the University year which creates very high demand."

Regionally, Trade Me reported the largest percentage increases in rental prices in Manawatū/Whanganui, at 17 percent, in Marlborough, at 13 percent and in Northland at 11 percent.