Investor selling plans spike while buying appetite and long‑term holds fade
New Zealand residential property investors are becoming more cautious and shorter‑horizon, as fresh survey data point to rising selling intentions and record‑low appetite to expand portfolios.
This shift comes against an unusual backdrop where house prices remain about 20% below their pandemic peak despite the Reserve Bank slashing the official cash rate from 5.5% to 2.25%, leaving borrowers grappling with lower equity, higher servicing costs, and weak confidence.
The latest monthly Investor Insight survey from Crockers Property Management and economist Tony Alexander (pictured), based on 230 responses, shows a record net 26% of existing residential investors are thinking about selling over the next 12 months, up from 17% a month earlier and 11% six months ago.
At the same time, only 12% of respondents say they are considering buying another property in the coming year, down from 16% last month and the lowest reading since the survey began in mid‑2021.
This trend reflects what Alexander describes as “changed dynamics for property investment in a climate of slow capital gain, high running costs, and shortage of good tenants.”
In its February Monetary Policy Statement, RBNZ signalled it expects house prices to be broadly flat through 2026, reinforcing that the traditional post‑cut rebound in values is unlikely to bail out over‑stretched investors this cycle.
As more investors focus on cash yield rather than capital gains, the survey suggests purchase activity could stay subdued, even as some borrowers look to refinance or restructure existing loans.
Fewer long‑term holds, more rent rises on the horizon
The survey also points to a shortening investment time frame.
The share of investors planning to “never” sell or hold for at least 10 years has fallen to 44%, from 48% a month earlier and a five‑year average of 58%. That tilt away from very long‑term holds could translate into more stock coming to market, affecting both rental supply and sales pipelines for brokers with active investor client bases.
On the income side, rent pressure remains elevated.
A net 42% of landlords say they intend to raise rents over the next 12 months if they can, only slightly down from 44% last month. The average rent increase they are targeting is around 4%, unchanged for three months.
That combination of higher rents and potential sales may further stretch first‑home buyers and tenants already dealing with higher mortgage rates and cost‑of‑living pressures.
Costs, regulation, and banks shape investor sentiment
When asked about risks to returns, council rates and insurance costs remain the top concerns, although the survey notes a slow easing in worries about these expenses as talk of rate caps emerges and some insurance premiums edge lower.
By contrast, worries about interest rates have “jumped strongly at the start of the year and remain elevated,” and concerns over tenant regulations are creeping higher ahead of the general election.
Most investors still describe their bank’s attitude as accommodating, but confidence in this has “slowly eased off” on the survey’s net measure. A net 32% of landlords report that finding good tenants is difficult, up from 30% last month, suggesting vacancy and quality issues remain in parts of the market.
To read the full report, click here.
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