The flattening of high houses prices and recent records in the stock market were also floated as a factor which might be putting investors off.
"We all know how expensive houses have become over recent years, and now we are seeing the market flatten in many areas, including Auckland," Tennent-Brown says.
"Developments in share markets may be viewed in the same light by investors. Many sharemarkets, including New Zealand's, have hit record highs in recent months and perhaps investors are thinking that recent gains can't continue unless we start to see stronger earnings growth."
Rental property is now on par with home ownership as the investments which provide the best returns, both equal at 21 per cent. Term deposits came in second at 12 per cent, with Kiwisaver following at 9 per cent.
"Auckland continues to experience strong population growth, and in turn, strong demand for accommodation," Tennent-Brown said.
"Rental data suggests that rents have been on the rise in Auckland this year, with stronger increases than elsewhere. We think the increased rents are behind the improved sentiment regarding rental properties, given that prices appear to have plateaued and lending restrictions are also a challenge for investors."
Caution over share valuations saw sentiment for the market drop from 7 per cent to 6 per cent this quarter.
"This isn't a major drop, but perhaps reflects a degree of caution given where share valuations have reached over recent months," Tennent-Brown said.
"The New Zealand sharemarket was one of the stronger-performing sharemarkets over recent months, with the NZX50 index of shares up by nearly 6 per cent over the June quarter. With the sharemarket trading around record high levels, investors are rightly looking carefully at firms' earnings outlooks."
Term deposits lead as the bank product providing the best returns, reflecting a preference among investors for safe investments.
