

Commercial property confidence returns to positive territory
The outlook for an upturn in commercial and industrial property sales has improved following the Reserve Bank of New Zealand’s recent decision to start reducing the official cash rate (OCR), according to Colliers’ latest investor confidence survey.
Confidence levels rose to a net positive reading of 10.4% in September, compared to a net negative of 5.0% in June.
This marked a turnaround after a decline in confidence since the start of the year.
“Results of the confidence survey have been volatile since 2020, initially due to the impact of the COVID-19 pandemic and the economic response to it, and more recently due to the tightening of monetary policy aimed at combating inflation,” Colliers said.
The link between economic growth, sales numbers and confidence
Two trends emerge when you study historical survey results, according to Colliers.
First, investor sentiment has closely tracked overall economic performance over the long term. “Sentiment reached record lows during the Global Financial Crisis (GFC) but rebounded as economic growth resumed, driven by the Reserve Bank of New Zealand’s decision to cut the OCR from 8.25% to 2.5% between July 2008 and April 2009. The economy’s robust performance from 2014 through early 2020 saw investor sentiment holding at elevated levels.”
Second, greater sales activity tends to be closely correlated with greater investor confidence, and vice versa. “Both the number and total value of transactions steadily increased in the early 2000s. However, the significant economic disruption caused by the GFC led to a sharp downturn in sales. Transaction activity subsequently rose alongside a strengthening economy, enjoying an extended period of stability prior to 2020.”
Colliers has forecast that as the economy rebounds in 2025, aided by lower interest rates, sales activity will rise, as will investor sentiment.