The flow-on for real estate is that property investors seem to be following suit. Peter Thompson, managing director of Barfoot & Thompson, Auckland's biggest real estate agent, reports a significant increase in inquiries from would-be buyers in Hong Kong and the mainland.

He says the inquiry level, which has been increasing steadily for several years, has spiked in the past three months. Interest is coming from across Asia, but particularly from Hong Kong and the mainland.

Many are parents educating their children in New Zealand and who want to have a local base. Others are purely property investors for whom greener pastures beckon, as legislation introduced to cool the mainland's heated property market prevents them from buying more real estate in certain mainland cities. New Zealand remains open to foreign property ownership, and the currency exchange makes it a value proposition, Thompson says.

'There are some very good properties in New Zealand, making it affordable for overseas buyers to get a better property. We're seeing quite a few buying in the higher-end sector.'

Peter Holmes, sales manager at Crockers Property, agrees. He sees inquiries from Hong Kong and the mainland as a bright spot in an otherwise lacklustre market.

Crocker's latest market research, for this month, shows 'not a lot of up' for Auckland property owners. It found the median price of houses sold last December was lower than a year earlier, while, in a 'double whammy', the number of sales also dropped by 20 per cent. Landlords fared better, with rents rising by up to five per cent. Holmes describes this as a common trend in difficult times - a tight market and rising interest rates force more people out of home ownership, deepening the pool of renters.

The ensuing rental shortage could impact the sales cycle again, Holmes says.

'With consecutive months of positive migration flows, and little or no growth in new development projects, all the signs are there for an increasing sales market for 2011. Historically, an uplift in sales tends to lag about six months behind the increase in the rental market. Conditions are even more definite this time around as there has been only a minimum of development projects coming on stream in the last three years, which is creating a shortage of properties in Auckland.'

Holmes notes, however, that activity seems to be improving, with the number of unconditional sales at Crocker halfway through this month surpassing last month's total. 'This reinforces the anecdotal evidence we are hearing,' he says, crediting New Zealand's positive migration flows, relatively low mortgage interest rates and improving economic confidence.

'I also feel as New Zealand gets closer to hosting the Rugby World Cup, business and personal confidence levels will lift even higher which should have a very positive effect on the markets in general - the sales and rental property markets.'

Cultural ties also play a role in attracting Hong Kong and mainland investors, Holmes believes.

'Inflows from China are still very strong as New Zealand [and particularly Auckland] is viewed as less crowded and less polluted than their homeland,' he says. 'The relaxed, healthy way of life appeals as well as the educational opportunities, so New Zealand is seen as a very positive place to invest in and migrate to. More than 15 per cent of Auckland's population is of Asian origin, so they have become an integral part of our community.' Like the living environment, investment opportunities are considered to be fairly safe, Holmes says. These range from entry level to top end, with interest coming from private buyers and institutional investors alike.

Chinese parents wanting a base to house their student children will usually want an inner-city apartment. Families looking to migrate to New Zealand prefer properties in the upper end of the market within the top school zones.

Savvy Chinese investors may also have spotted the low ebb in the Auckland property cycle, and note the indicators of a rental shortage over the next decade.