The popularity of rental property among investors has hit an almost 10-year low, according to the latest ASB Investor Confidence survey.
The survey - which asks investors to rank the investment class that offers the best returns - found that rental property ranked joint second with KiwiSaver, with 13% of respondents saying they offered the best returns.
That is the lowest level of popularity among investors since the third quarter of 2002.
"The effects of the property slump still appear to be taking the shine off rental property investments, despite the current low interest rates," said ASB head of private banking and wealth management Jonathan Beale.
"I've been talking about this survey since 2004 when I first started at ASB, and rental property has always been historically the darling of the survey. Since the global financial crisis we have seen term deposits take that mantle."
As well as the property slump, Beale cited the tax changes to investment property and household deleveraging for the slide in popularity of investment property.
He also contrasted the mood now to his arrival in New Zealand in 2002.
"My experience [then] was very much 'I've got to buy another rental property, I've got five and I want to buy one more,' if I speak to my wealth managers around New Zealand, you just don't hear that anymore."
Term deposits remained the most popular investment class for the sixth consecutive quarter, with 18% of respondents believing they would offer the best returns.
"Investors are still behaving cautiously, with many looking to the traditionally lower risk option of term deposits as their investment of choice. This comes even through the Reserve Bank has signalled that interest rates are likely to remain low until next year."
KiwiSaver - joint second with rental property on 13% - recovered from its dip in popularity last quarter, shrugging off the Budget 2011 changes.
"Our results show that almost half of respondents, a record 47%, are currently using KiwiSaver," Beale said.
"Out of those using or intending to use KiwiSaver, a total of 64% say it will be their primary source of retirement - again the highest level we've seen in this survey."
Bank savings accounts edged down to third on 10%, equal with managed investments, while shares were last out of the six asset classes on 8%.