Confidence in residential property investment returns has stabilised after six months of sharp decline, according to the latest ASB BANK Investor Confidence Survey.
The September quarter survey, released this morning, showed that 15 per cent of those questioned were confident in the returns from residential property. That was up from 13 per cent in June.
Meanwhile, 25 per cent of investors favoured managed funds as most likely to give the best returns in the year ahead, a rise of two per cent over the quarter. Confidence in shares fell from 14 per cent to 11 per cent, which ASB BANK put down to "turbulence" in the forestry and telecommunications sectors.
However, only a net seven per cent of those surveyed expected their investment returns to improve in the year ahead, compared with a net 15 per cent for the June quarter. The Bank's Chief Manager Investment Services, Roger Perry, puts that down to a combo of local and international factors, saying the slide in investor confidence has occurred since what appears to have been a turning point in April.
"The NASDAQ Index fell by 15.6 per cent in April, brought about by the sharp decline in the value of Internet stocks. It continued to fall a further 11.9 per cent in May.
"About that time, it also became clear that there was a loss in confidence in New Zealand's economic prospects."
Perry says the results of the survey aren't surprising. "It mirrors the mood of the country and the local sharemarket, especially when this is combined with the impact of higher petrol prices and a weak New Zealand dollar.
"Despite all these disturbances, it's encouraging to note that investor confidence remains positive - if only just."