Christchurch offers potential for property investment boom - maybe

The potential yield boom hinges on whether the Government will buy damaged housing stock then sell-on at a discount and also restore the city's infrastructure.

"If the infrastructure is taken back to what it was on February 21 the indication that we have is that rental levels would stay virtually the same as they are now, but because you've purchased the property at the lower purchase price, even with repairs and refurbishment, its substantially lower than what the house was originally worth, but your rental is still the same, your yield has automatically gone up," a Bayleys spokesman said.

Bayleys Karen Philips said if the properties were acquired by the Government, then sold at a reduction, it "will open up opportunities for property developers and investors returning to the market."

"However, these opportunities of course depend on the Government, the EQC or insurance companies, on-selling the properties in an ‘as-is, where-is' basis, and allowing for redevelopment and reoccupation rather than abandonment. At this stage, the big unknown is just what land will be deemed recoverable , and what land would be deemed to be written off," she said.