Part of Wellington, capital of New Zealand. Photo by Shutterstock
New Zealand will allow wealthy foreign investors to buy property, partially reversing a seven-year ban that had aimed to cool soaring prices.
The ban, pushed by the center-left government of former prime minister Jacinda Ardern in 2018, aimed to reign in the South Pacific nation’s booming housing prices, blamed at the time on record migration levels and a shortage of housing stock.
Australians, at the time the second most common foreign buyers after Chinese, were exempt due to free trade agreements, as were Singaporeans.
But under new rules announced Monday that come into force by the end of the year, holders of a Active Investor Plus residency visa will be able to buy or build a house worth NZ$5 million (USD$2.95 million).
Prime Minister Christopher Luxon said since its launch in April more than 300 people had applied for the visa, which requires at least $5 million investment over three years.
The price threshold for property “navigates a path between those who do not want foreign ownership opened up, and the desire to attract high net worth investors,” Luxon said.
New Zealand’s remoteness, once considered a hurdle for buyers, has also made it popular for ultra-rich foreigners looking for a bolthole.
Billionaire Paypal founder and U.S. President Donald Trump backer Peter Thiel became a citizen in 2011 and had planned a vast private estate — later sparking scandal when it was revealed he had spent only 12 days in the country.
House prices in New Zealand have fallen over the past two years after surging by more than 30% in some regions during the pandemic.
But the housing supply remains tight and home ownership remains out of reach for many New Zealanders.
