Anzo sees upside to property squeeze
Sunday 17 October 2004
A squeeze on premium office space should help offset rising interest rates and see healthy investor returns during the next few years, Robert Lang, head of AMP NZ Office Trust, says.
By The LandlordSpeaking at yesterday's annual meeting in Wellington, Mr Lang said despite clear indications that rising interest rates were beginning to slow the residential market, Anzo had fixed the rates on 86 per cent of its debt for five years to reduce exposure to increases.
In Wellington, supply and demand was at a point that businesses looking to upgrade would have to pay more – which would over-ride interest rate rises at least in the short term, he said.
A slight resurgence in the language school market, which occupied lower grade buildings, was also helping to push up demand for premium office space.
Mr Lang said rents of top grade buildings had gone up between 30 and 50 per cent in the past three years. In future, growth was expected to be a more modest 5 per cent per year.
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It looks like the sleeping giant of New Zealand’s housing market could be stirring, with new REINZ data showing that both sales and prices in Auckland are up.
There’s no sign of a slow-down in Wellington’s property prices with Trade Me Property’s latest data showing that asking prices continue to rise solidly.
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