COMMENT: Which property markets are most vulnerable?

Kelvin Davidson

Clearly there is a tough period ahead for the economy, with GDP set to fall sharply and unemployment rising. That will flow through to a weaker property market generally.

But, based on a simple ranking across a range of indicators, Queenstown’s market looks the shakiest. In contrast, Whangarei, Hamilton, and Invercargill appear to be a bit less risky.

Factors in favour of these “safer” areas include less tourism reliance and not as big a surge in investor activity in their property markets of late.

Unfortunately for Queenstown, it has nearly 20% of its output coming from accommodation and food services – and this is a sector set to be hit hard by the various stages of lockdown and the tourism downturn.