Investor optimism grows for year ahead

More investors are confident they will earn better returns over the next 12 months, and residential property remains the favourite investment despite the cooling housing market and lower rental yields, the ASB says.

A net 19 per cent of respondents expected to do better from their investments in the next 12 months, up from 16 per cent three months ago, says the ASB investor confidence report released today.

Net confidence figures are optimists minus pessimists.

"While we continue to get mixed messages about the performance of asset classes in New Zealand and overseas, there is enough good news in key indicators such as equities, employment and housing to drive confidence," said Jonathan Beale, head of investment services at ASB Investments.

Confidence has risen from a net 9 per cent six months ago.

Nineteen per cent of New Zealanders said they expected residential property to deliver the best returns, unchanged from three months ago.

"Despite rising interest rates, the cooler housing market and lower rental yields, residential rental property remains the highest-ranked asset class," said Beale.

The popularity of bank deposits and term deposits fell from 13 per cent each to 12 per cent and 9 per cent respectively.

Beale said: "It is a real surprise to see drops in confidence with savings and term deposits, given the rates currently available in the market and the continued success of high-interest call accounts."


Kiwis' nest-eggs

New Zealanders' top investments:
* Residential property 19pc
* Bank savings accounts 12pc
* Commercial property 11pc
* Managed investment fund 10pc
* Term deposit 9pc