Pre Covid 19 New Zealand’s net migration sat at an average of around 6,500 per month. That put pressure on residential housing prices and also the demand for rental accommodation. With migration set to be in the doldrums for some time to come the ‘glass half empty’ brigade are starting a small wave of panic around the likelihood of falling demand for rental property and likely lower rents as a consequence. In our view there are a couple of mitigating factors. Firstly, our boarders won’t be closed forever. Maybe they won’t reopen as soon as we had hoped but the reality is our closed boarders are just temporary. Secondly, and this is an important aspect in helping ‘prop up the rental’ market, at least temporarily, a lot of expats are coming back home to live in Gods own. They are going to need accommodation so in the short term this will help off-set some of the lost tenants as a result of lower migration. And on an even more positive note it’s likely that departures of non-citizens out of NZ will decrease as these people decide to stay, in what is perceived to be a safe country given the impact Covid 19 is having in other parts of the World.
What impact will falling migration have on rental demand? National Propertyscouts
Lots, some will have you believe, and not for the better. But wait... it's not all negative.