Survey Shows Property Investing Has Taken Huge Hit

Survey Shows Property Investing Has Taken Huge Hit

An annual property survey shows that, for the first time in several years, the number of New Zealanders interested in investing in residential property has declined significantly. This is according to the annual Nielsen Real Estate Market Report, an online survey sponsored by Realestate.co.nz.

Last year, one in four of those surveyed said they intended buying residential property as a future investment. Only 12 months later it’s in stark contrast, with just one in seven having the same intentions – the lowest level in the history of the survey. As Greg Towers, specialist property lawyer and Partner at Simpson Grierson, comments:

“This survey confirms what we have observed; there has been a measurable decline in the number of transactions involving the traditional property investors. This is unlikely to change until there is uplift in the general economy and a greater degree of confidence shown in the property market by all parties."

In addition, there is now a very clear intention among investors who own property to hold rather than sell, which is a clear indicator of why the property market in general has slowed significantly. As Alistair Helm, CEO of Realestate.co.nz says:

“The survey highlighted the caution around the market at the moment. 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’.”

This sentiment is supported by the stats. In the space of a year, there has been a 24% increase of intention by property investors to seek out private sellers.

The challenging market conditions and general uncertainty are factors that have been circling the industry for a while; however, this survey represents the first published data since the announcement of the tax changes to property investment. As Tony Boyte, Research Director for The Nielsen Company’s Online Division says:

“The property boom made it easier for people to predict the market trends. Recent event seem to have muddied the waters over how much, up or down, price has moved.

From our research, this appears to have caused people to put on hold plans to invest in residential property.”

For more stats, as well as charts and graphs complied during the survey, please see the contacts detailed below.

More analysis of this report as well as the property market in general is available at the media site of Realestate.co.nz - www.Unconditional.co.nz.

Note: The Nielsen Real Estate Market Report is based on a site-intercept survey on New Zealand real estate websites conducted during April, May and June 2010 with a sample size of 1,225 respondents and margin of error of 2.86 percent.

About Realestate.co.nz
Realestate.co.nz is the official website of the New Zealand real estate industry, and provides the most comprehensive selection of listings across all categories of real estate. Realestate.co.nz lists more than 118,000 properties each year, representing more than 90 percent of all listings currently marketed by real estate professionals.

ENDS

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