Net immigration and tourism upswing shifts outlook for borrowers and banks
Stronger migration and tourism are adding a new twist to New Zealand’s housing outlook, with fresh data pointing to faster population growth than the Reserve Bank had pencilled in.
ASB economist Wesley Tanuvasa (pictured) says, “Migration momentum remained over February” with annual net immigration sitting around 25,000 people in the year to February 2026, even after data revisions.
On a shorter-term basis, net permanent and long-term inflows are running at about 43,000 a year, close to the average seen over the past decade. That pace is stronger than RBNZ’s most recent working-age population forecasts, suggesting the labour force is rebuilding more quickly than policymakers expected.
A key shift in the mix is that “Kiwi flight looks to have peaked”, with fewer New Zealanders heading offshore and more non-residents arriving, particularly from China, India, and ASEAN countries.
The report notes that global tensions, including the Middle East conflict, may be encouraging some would-be emigrants to delay overseas experience plans while viewing New Zealand as a relative safe haven.
Tourism recovery adds to housing and spending pressures
Alongside permanent and long-term migration, inbound tourism is also pushing higher, reinforcing demand for accommodation, hospitality, and regional property markets.
ASB highlights “short-term visitor arrivals now reaching 92% of pre-COVID peaks”, with nearly 3.6 million visitors over the year and Chinese arrivals more than tripling on the back of a later Lunar New Year.
Migration cuts labour strain but may keep mortgage rates higher
ASB emphasises that stronger migration has two-sided effects. Extra workers can ease labour shortages and take some heat out of wage inflation, which in theory could favour a lower interest rate path over time. But faster population growth also lifts demand for housing and everyday spending, which could keep inflation – and therefore mortgage rates – higher for longer if supply fails to keep up.
Read the full ASB report here.
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