Property investment gets reality check

Rental property has fallen from being the investment most likely to produce the best investment returns to number three in the survey behind term deposits and bank savings accounts.

Until recent quarters rental property totally dominated as the best returning investment option with around 22% of respondents saying it was the investment class that would produce the best returns. In the latest quarter it has fallen to 15% which is a couple of points off its all time low which was recorded in the middle of 2002.

What is no surprise is that people are embracing term deposits, especially with banks. This type of investment is likely to go much higher in the survey as the most recent one was done before the government announced its deposit guarantee scheme.

ASB Head of Investment Services Jonathan Beale says rental property has “come off quite dramatically” in the survey.