Abstract
We investigated the psychology of risk in the context of residential property investment. One hundred and thirty‐seven participants completed a questionnaire that measured their sensation‐seeking, general investment risk attitude, and attitude and confidence about investing in a term deposit, unit trust shares, a residential property syndicate and residential property. People with higher sensation seeking scores found shares and unit trusts more attractive than low sensation seekers, but all groups were most confident about investing in residential property. Overall the results indicate that New Zealanders invest overwhelmingly in real estate because they trust it more than other forms of investment.
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