Huge drop in number of New Zealanders willing to invest in real estate, survey shows

Last year one in four people said they intended buying property as a future investment, but this year that number has fallen to one in seven, according to the annual Nielsen Real Estate Market Report.
 
It is the lowest level of interest since the survey began four years ago and it also shows that investors intend to hold onto their property portfolios rather than sell.
 
They survey also shows that in the last 12 months there was a 24% increase of intention by property investors to seek out private sellers as they are regarded as being a source of better deals.
 
‘Holders of investment property showed a 42% decline in intention to sell, which is a huge decline. As a result, there is likelihood that those investors still looking to find value will target private sellers who they perceive to offer better deals in this type of buyer’s market,’ said Alistair Helm, chief executive.
 
The survey is the first to be published since the announcement of tax changes to property investment announced in May’s Budget.
 
Experts believe that the sentiment is unlikely to change in the near future. According to Greg Towers, a specialist property lawyer at Simpson Grierson, there needs to be uplift in the general economy and a greater degree of confidence shown in the property market by all parties before investors are enticed back.
 
Meanwhile buyers in the UK and Switzerland are being encouraged to invest in real estate in New Zealand. Leading agents Bayleys believes that there is growing interest from these countries.
 
‘Our website traffic data records that about 22% of international hits on the Bayleys website come from viewers in the UK. This figure has been growing during the past few years,’ said marketing manager Richard Graham.
 
Properties will be shown in a series of international road shows in Bath, Stoke-on-Trent, York, Huntingdon, London, Manchester and Zurich.
 
Last year, David Bayley, executive director of Bayleys Real Estate, sold one of Auckland CBD’s commercial properties, the Pernod Ricard building at 4 Viaduct Harbour Avenue, to an offshore investor despite challenges caused by the rising kiwi dollar.