By Adrian Bishop
One of the first steps of New Zealand’s Prime Minister-elect has been to seek to ban overseas property buyers.
Jacinda Ardern, who leads a coalition government, aims to introduce a bill by Christmas preventing foreigners from purchasing existing homes. She told the Council of Trade Unions conference, “Our goal and commitment is to ban foreign buyers from the existing housing market.”
They say their hope is that the move will stop speculators pushing up the price of property and keeping it out of reach for Kiwi nationals.
At the same time, the Labour Prime Minister-designate pledged to introduce a rent-to-own scheme, or a similar proposal. It is part of the party’s KiwiBuild programme under which 100,000 affordable houses have been promised for New Zealand first-home buyers within a decade.
Deputy Prime Minister-elect, Winston Peters, from New Zealand First, says, “The reality is there is going to be a change and a clear signal set internationally that New Zealand is no longer for sale in the way that it has been. And we are happy with that."
International real estate market experts say the proposals are likely to be watched closely by other countries to see how successful they are at reducing property speculation.
New Zealand, along with its neighbour, Australia, has attracted large numbers of Chinese and Asian homebuyers, which some people believe has helped push up prices and reduce availability for nationals.
ANZ Bank says New Zealand needs another 60,000 homes to meet the need of the country’s 4.69million population.
The country’s largest city, Auckland, has seen its median home price nearly double since 2008. The typical Auckland home was worth NZ$1,013,632 in August 2017, up 15.9% year-on-year, according to the QV House Price Index.
The rise in New Zealand house prices over recent years has been fuelled by strong immigration, low interest rates and limited housing supplies, say market experts.
The proposals are set to only apply to non-residents, so immigrants are not likely to be affected.