Auckland exodus to boost regional business

Close to half of nearly 10,000 Aucklanders surveyed by Stuff say they are considering leaving the city for good after a year of lockdowns.

The survey comes after Statistics New Zealand revealed last month that Auckland’s population has fallen for the first time ever, with Covid-19 being blamed for people moving out of the region.

Hamish Slack, Statistics New Zealand population estimates and projections manager, said that while the population decrease in Auckland/Tāmaki Makaurau was only 1300 - or 0.1 percent - this was still a “significant change”.

‘The Auckland region has averaged population growth of 1.8 percent a year over the previous 20 years, higher than the national average growth of 1.4 percent a year,’ Slack said.

We want out of Auckland

Today’s Stuff survey was completed by 9987 people. It was a self-selected, non-scientific poll.

44 per cent of respondents said they were considering moving, with 51 percent saying they weren’t considering it, and 5 per cent saying they didn’t know.

Vaccination frustrations, repeated lockdowns, the threat of closed borders and high house prices are among the reasons given by respondents for considering the change. While some are considering crossing the Tasman, many are looking to move to other regions of New Zealand.

In a recent article in Franchise New Zealand magazine, Chris Small, managing director of ABC Business Sales, said, ‘We have definitely definitely seen an increase in Auckland purchasers looking for regional businesses in the last year.’

Regional businesses more profitable

In the same article, Philip Morrison of Franchise Accountants confirmed that the trend is a growing one. ‘For a number of years now we have been seeing more and more clients looking to sell up property in Auckland and move further afield to start businesses. They see it as an opportunity to improve their financial position overnight, reduce debt and improve their quality of life, and if they want to have their own business then cashing in on their property can make it very affordable.

‘If they are concerned about leaving the Auckland property market altogether, then keeping their property and renting it out can be a good option. They can almost certainly rent something in the regional centres much more cheaply, so they are reducing the burden of debt that the new business needs to support. In turn, that enables them to pay off any borrowings and improve profitability more quickly.’

And Daniel Cloete, National Franchise Manager for Westpac, noted that some of the most profitable outlets in many franchise systems are located in the regions rather than the major centres. He listed four reasons why, while regional centres might have a smaller economy, they can produce better results.

Read the full article about the advantages of buying a business in the regions in the latest issue of Franchise New Zealand. Get a free print copy of the magazine or download a free digital copy now.

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