Investor confidence just bounced back without the landlords

New Zealand investors have found their nerve again. They just aren’t spending it on another rental.

ASB’s latest Investor Confidence Survey shows net investor confidence rose 14 percentage points to 15%, above where it has typically sat over the past two years. Auckland led the rebound, up 22 points to 26%, its best result in nearly three years. But when respondents ranked the asset classes they expect to deliver the best return, managed investments, KiwiSaver, the family home, shares and term deposits filled the top slots. Rental property did not appear.

That is the story. Money is moving again. It is not automatically flowing back into housing.

A rebound off a very low floor

Context matters here. Last quarter, net confidence sat at just 1%, matching the June 2025 low when US tariff policy first rattled sentiment. That survey recorded 86% of investors concerned about local political uncertainty and a record 57% “very concerned” about global geopolitical and economic conditions.

So a jump to 15% is a recovery to normal, not a boom. ASB senior economist Chris Tennent-Brown put it plainly, telling RNZ that confidence was “back to where it’s been knocking around” after hits from the Middle East war this year and last year’s tariff “liberation day”.

What drove it is the important part. “Share market performance was a key positive in the quarter,” he said, adding that strong equity returns and a weak New Zealand dollar were “helping to boost the balances for people in managed funds and KiwiSaver, and that’s why they are showing up as the place to be.”

The scoreboard investors are now reading

The latest ranking had managed investments on 16% and KiwiSaver on 15%, ahead of owner-occupied housing on 14% and shares and term deposits on 12% each. ASB’s release doesn’t spell out a current rental-only figure, but in the prior quarter just 10% of respondents picked rental property as the best-returning asset, near a record low and beaten only by bank savings accounts.

This isn’t a one-quarter wobble. In early 2026, the Q4 2025 survey found housing had been knocked off the top spot for the first time in years, with KiwiSaver and managed funds taking the top two places. Tennent-Brown said then it was “pretty amazing to see housing knocked off the perch”, and flagged a generational split: over-60s still backed their own home, while Gen Z favoured direct share investing. Nearly a year on, the pattern has hardened rather than reversed.

Why the rental maths stopped working

Part of this is simply that property has been flat, and flat markets expose the cash returns. Float’s head of accounting, wealth and advisory, Niran Iswar, told RNZ in September that almost every rental he has owned lost money once opportunity cost was counted. On a $500,000 fully geared property earning $500 a week, he said, insurance, maintenance and time eat most of the return “unless you hold it for an extended period of time.” His prescription wasn’t abandonment but diversification, looking at “property and other asset classes at the same time.”

The other part is political. Ahead of the election, Tennent-Brown linked rental pessimism to party platforms floating the removal of interest deductibility and, in one case, a land tax. Investors don’t need a policy to pass to price it in. The mere prospect of a less favourable tax regime is enough to tilt a marginal purchase decision towards a managed fund that carries no such risk.

Retirement policy is now a vote-mover

The survey also found nearly seven in 10 people aged 30-39 say KiwiSaver contribution settings and the superannuation age could influence their vote. That is an economically engaged, mortgage-age cohort telling parties that long-term savings rules matter. As Tennent-Brown put it, “long-term financial security is front of mind for many New Zealanders well before they reach retirement.”

For fund managers and bank wealth arms, that is a structural tailwind. For landlords, it is a warning that the next generation of investors has other ideas about where wealth gets built.

What happens next

Don’t mistake this for a clean recovery. Tennent-Brown warned “there’s still a lot of uncertainty over the rest of the year,” particularly around property and KiwiSaver changes. A share market correction or a firmer dollar would quickly dent the fund balances doing the heavy lifting.

But the direction of travel is clear and, frankly, healthy. An economy where savings flow into productive, liquid assets rather than defaulting to leveraged housing is one with a broader capital base for business. The rental market will recover when the numbers and the tax settings justify it. Until the election settles those settings, investors have made their choice, and it isn’t another landlord punt.

Sources

• RNZ: Investor confidence up – but not for property (2026-11-04)
• ASB: Investor Confidence Survey Q2 2026 (2026-09-21)
• NZ Herald: Survey shows investors turn away from housing, plus are Aussie bank profits too big? – Inside Economics (2026-03-03)
• RNZ: Why a financial adviser says nearly every rental property he’s owned has lost money (2026-09-14)