Home ownership importance 'to wane'

Less importance will be placed on home ownership at retirement due to Kiwisaver and housing affordability, Mercer investment managers and consultants predict.

The Mercer Investment Trends and Industry Outlook for 2008 said while people have traditionally wanted to own their home at retirement this "may be misplaced and could be revised during 2008".

Kiwisaver will become the preferred method of retirement savings, the report said.

The alternative of Kiwisaver and issues over housing affordability were driving the change, the report said.

The report said the weakness of the US economy would affect the global economy, but the Chinese economy would play a bigger role in the Asia-Pacific region.

Responsible investment was likely to be increasingly popular in 2008 with investment focused on environmental, social and governance factors.

Companies would continue to focus on issues of remuneration, accountability and transparency, the report said.

Due to a volatile sharemarket the new PIE and FDR tax changes have not had a good start, Mercer said. It expects the changes to benefit all investors and produce long term after tax returns.

- NZPA