Confidence survey results reflect record low industrial vacancies
Investor confidence in New Zealand’s industrial property market has increased across all the main centres, while sentiment in the office, retail and residential market has dipped.
Colliers International’s latest quarterly survey results reveal confidence in the overall commercial property market has dipped slightly to 22 per cent, down from 24 per cent the previous quarter.
Confidence in the residential property market has fallen to 32 per cent, down from 41 per cent.
Industrial was the only sector to make gains, with confidence up by between 2 to 3 percentage points in the three main centres of Auckland, Wellington and Christchurch.
Colliers International Research and Consulting National Director Alan McMahon says the industrial market is particularly buoyant in Auckland, where confidence increased to 60 per cent in the June 2017 quarter.
“This level of positivity reflects Auckland’s record low industrial vacancy rate, which fell recently to 2.1 per cent – the lowest point since our records began more than 20 years ago.”
The survey found confidence in the office and retail markets fell in all three main centres.
The top four commercial markets for investor confidence were Queenstown (66 per cent), Tauranga/Mount Maunganui (55 per cent), Auckland (41 per cent) and Hamilton (28 per cent) for the fourth quarter running.
In Wellington, overall confidence in the commercial market dipped to 24 per cent, down from 29 per cent in the previous quarter.
“One surprising result is confidence in Wellington’s retail sector, which has fallen from 17 per cent to 5 per cent – the lowest in two years,” McMahon says.
“The dip comes despite record low retail vacancies in Wellington, driven in part by a flurry of new retail openings. We expect a recovery from this level over the balance of the year.”
McMahon says the residential outlook remains positive across New Zealand, despite all regions experiencing a slight decline.
“The dip is likely due to increasing interest rates and house price growth declining nationally. However, national sentiment remains upbeat, with almost all centres reporting a positive result.”
The top three residential markets remain unchanged from the last quarter.
Queenstown is in the lead on 68 per cent, followed by Tauranga/Mount Maunganui (51 per cent) and Hamilton (46 per cent).
The surveys, which track sentiment in the commercial and residential property markets, were carried out by the Colliers International Research and Consultancy team this month.
The commercial survey was based on 2,146 responses while the residential survey drew on 11,290 responses.
Read more in the Commercial Property Investor Confidence Survey and the Residential Property Market Outlook Survey.
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