The latest Colliers International commercial property confidence survey showed that declines in confidence were most marked in Dunedin and Palmerston North.
Colliers Dunedin manager Stephen Cairns said the city's confidence levels plummeted 11% to sit at -17%, just 1.9% ahead of Wellington and only 3% ahead of the most negative place in the country - Queenstown on -20%.
"In terms of sales, we are not seeing that fall in confidence demonstrated but the growing unemployment rate and business closures are having a flow-on effect."
The unfolding situation with finance companies looked set to continue well into next year and that was affecting confidence among commercial property investors.
However, a property in Kaikorai Valley sold at auction yesterday for $450,000.
Although the price was slightly below that expected, it was still a "reasonable" sale, Mr Cairns said.
Nationally, Tauranga, Mt Maunganui and Hamilton were the only areas in positive territory.
The nationwide survey totals showed confidence levels across the country had flattened since September.
That followed the positive trend shown in the June and September surveys, which were both up from record lows in March, he said.
"The much narrower band of opinion nationally in December compared to previous surveys suggests that recessionary pressures are being felt relatively evenly across the country.
"This pause for breath reflects results in other surveys which have recently recorded flat or declining confidence."
From a property point of view, that was probably a realisation that the optimism of mid-2009 might have been irrationally exuberant.
