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Sharp rise in confidence

Commercial property confidence has increased across all of New Zealand, according to Colliers International's latest quarterly confidence survey.

The survey shows that confidence levels are back on the rise across all sectors and in all regions.

Key survey findings;

• Overall confidence increased from -19% to -8%, the highest since June 2009
• Every centre surveyed showed an improvement in confidence about the year ahead
• Auckland and Christchurch had the largest increase in confidence, by 17% and 16% respectively
• Tauranga/Mt Maunganui & Queenstown are the only centres where optimists outnumber pessimists
• Wellington investors continue to be the most pessimistic in the country (-24%), despite a 9% improvement
• Of the three main centres Auckland is the most optimistic at a net 0%
• By sector in the main centres, industrial investors are most confident in Auckland and Christchurch, with retail investors most confident about Wellington's prospects

These results demonstrate that investors believe the market is stable. There may not be any good news but there isn't much bad news either. Rents and capital values may not be increasing to any extent but – by and large - they have stopped declining. The strong recovery in Auckland and Christchurch is significant, and may have a flow on effect to other centres in due course.

Although there has been a marked improvement in office sector confidence in Wellington, it still lags industrial and retail, perhaps reflecting nervousness about potential public sector employment cutbacks in 2011.

Tauranga/Mt Maunganui was previously the only member of the 'optimists club', but Queenstown has now joined (+6%), with Auckland also knocking on the door (0%). In Queenstown, booming tourism aided by more international flights, and a general stabilising of their market, will have helped.

There continues to be strong demand for low-risk commercial property investments.

3300 responses were utilised to construct the survey results.

Click here to read the full report in PDF format

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