The number of immigrants to New Zealand is still relatively high and bolstering demand for residential property, CoreLogic said, as figures released by Statistics New Zealand today showed annual net migration was slowing.
Annual net migration was at 67,000 in the year to April, from 71,900 in the year to April 2017, Statistics New Zealand said.
Some 98,300 non-New Zealanders arrived in the April year, up from 97,800 the year before, offset by a lift in the number of non-New Zealanders leaving to 30,200 from 24,500, leading to overall net immigration of non-New Zealanders of 68,100. A net 1,100 Kiwis left in the latest year, reducing total net migration to 67,000.
New Zealand has been experiencing record levels of net migration in recent years, which made rising immigration a key election issue as it strains the country's infrastructure and is blamed for inflating property markets. Net migration peaked at 72,400 in the July 2017 year.
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CoreLogic Senior Research Analyst Kelvin Davidson said although the migration total had dropped by 5,364 from the peak in the middle of last year, it remained above anything seen prior to January 2016.
"In other words, inflows of people to New Zealand are still very high and this is bolstering demand for residential property," he said.
"Many new migrants will go into rental accommodation for a start. But some will become owner-occupiers, and this strong source of new people to the country may be one reason why CoreLogic’s proprietary measure of first-home buyer activity is so buoyant.
"At 23 percent, first home buyers account for a higher proportion of activity across the country than at any time in the past decade."
Davidson said that migration lookrf likely to continue to drift lower. "Indeed, April’s figures perhaps contained the first hint that a long period of net inflows to NZ from Australia may have come to an end," he said.
"However, with New Zealand’s labour market strong, the drift lower is unlikely to turn into a deluge. And although the banks are applying affordability tests for new borrowers at theoretical mortgage rates as high as 7 percent, the flat outlook for the official cash rate should also help to keep market rates low and underpin buyer demand for property.
"There was also nothing in the Budget to radically alter a sure and steady outlook for property sales and values this year, and if anything the delays to the KiwiBuild programme only add weight to that expectation.”
Increasing numbers of migrants came on work visas in the latest year, up 5.4 percent to 46,400 from the previous year to April, with residence visa numbers down 14 percent to 14,300 and student visas dropping 0.6 percent to 23,700.
China continued to be the biggest source of migrants on residence visas, though that dipped 20 percent to 2,800 in the year, while the United Kingdom remained the biggest source of work-visa migrants, up 0.4 percent to 7,400.
Despite the drop in residence visas granted, Chinese migration remained the largest on a net basis, with 8,400 of net arrivals coming from China, though that was down 18 percent on a year earlier. India was the second-largest source at a net 6,800, though Indian net migration was also down 12 percent from a year earlier.
