Confidence in the Hawke’s Bay commercial and residential property markets is growing, the latest Colliers International quarterly survey results show.
The Commercial Property Investor Confidence Survey and Residential Property Market Outlook Survey were conducted by the Colliers International Research and Consultancy team this month.
According to the results, Napier/Hastings was the only area outside of Wellington to see confidence grow across both the commercial and residential markets.
Net confidence in the Napier/Hastings commercial property market was up1% from the last quarter at 13%.
On the residential side, confidence was at 41%, a 3% rise from 38% in Q4 2016.
Colliers International Hawke's Bay sales manager Kerry Geange says commercial brokers are seeing that confidence reflected in the strong levels of enquiry from investors and owner-occupiers, particularly in the industrial sector, and larger-value commercial investments.
“This has also translated into developer confidence, with the construction of new industrial stock to meet the increasing demand for quality industrial properties,” he says.
“We have also seen continued growth in enquiries from investors from outside the region, who are attracted by competitive yields and a safe economy. That means confidence in the region appears to be not only local, but far wider, which is really positive.”
The survey found that overall net confidence in the New Zealand commercial property market was still a positive 24%, but down from 32% in Q4 2016, while confidence in the national residential market remains steady at 41%.
Colliers International research and consulting national director Alan McMahon says while there has been a dip in commercial investor confidence, the 24 per cent net positive result means a significant majority of those who think the market will change are optimistic.
“New Zealand market fundamentals are sound, with demand for offices, shops, and industrial property steady to strong across the country,” he says.
“Centres with good growth in resident or visitor numbers, which boosts demand for all property types, tend to have higher confidence.”
The top residential market is also Queenstown, where investor confidence is at 74 per cent. The hot spot is followed by Hamilton (59 per cent), Tauranga/Mt Maunganui (56 per cent), and Auckland and Nelson (43 per cent).
McMahon says the overall positivity in the residential sector is a strong result.
“It is no surprise that where population growth is strongest, upward price pressure is more evident than in centres with slow-growing or static populations,” he says.
“The exception is Wellington, which is showing huge confidence despite a relatively slow-growing population. Our view is that Wellington has been too cheap for too long and is now playing catch up.
“At the other end of the scale Christchurch confidence is neutral, suggesting equilibrium between demand and supply.”
The surveys were based on 2,299 responses from the commercial sector and 14,781 responses from the residential sector.