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Property or Shares: Which is the Best Place for Your NZ Dollar?

small New Zealand city house” (CC BY 2.0) by Mr Thinktank

It’s a perennial question amongst New Zealanders. Would they be better off putting money into so-called bricks and mortar or trying their chances on the stock market? Unfortunately, it’s not a question with a simple answer as there are a number of things to consider first. But, hopefully, what follows will help to give an indication of which could be the way to go, given your particular circumstances.


Anyone looking for the best investment in terms of growth is generally looking over the longer term, meaning ten years or more. Although, as we hear all too often, past performance is no indicator for the future, property is a good choice for such a period of time. For example, back in 2010, the median home price was NZ$465,000 but in 2020 it has risen to NZ$629,000 and, in 2019 alone, property prices rose by 12.3%. In great-performing years, this is certainly a figure that the stock market could match, but it would be a question of choosing the right stocks to buy.


Source: Pixabay

When it comes to property, most people buy to have a place to live in, not generate an income. But, this has been a changing picture in the last few years with the arrival of sites like Airbnb allowing homeowners with spare space to let it out on a short-term basis. This is only relevant or possible for the minority of properties so, generally, homes should be considered as an expense rather than income generators. Shares, on the other hand, can pay regular dividends if a company is doing well, sometimes up to 6% of their value in extreme cases. This makes them a clear winner if you’re looking for an income, although it’s not guaranteed.


Anyone who has bought or sold a home will know first-hand what a protracted business it can be. Although the laws surrounding sales in New Zealand make it a simpler and quicker process than in many countries, it can still take a great deal of time. Shares, on the other hand, are quick and convenient to both buy and sell. You’ll find many guides online explaining how to buy shares in New Zealand. These sites also go into considerable depth on the subject as well as providing introductions to tried and trusted brokers. It will introduce you to the important concepts to be aware of when trading. This means that your share dealing can be up and running in a matter of hours compared with the weeks and months it can take to buy a property.


For some investors, volatility is one of the most exciting aspects of the stock market. Prices can rise and fall quickly, driven by some very unexpected factors. While property prices do rise and fall, these cycles tend to be over longer periods of time and are less extreme. So, for the more cautious investor, it has to be property but, for the more adventurous, it’s stocks and shares every time.

Having looked at these four areas, there are many other factors to consider too. Ultimately, it comes down to individual preferences and circumstances – and only you can be the judge of them.