NZ MOVES TO CURB FOREIGN OWNERSHIP
New law passed, aimed at reining booming prices and making homes more affordable for New Zealanders
NEW ZEALAND has passed legislation curbing foreigners’ ability to buy residential property in a bid to rein in the South Pacific nation’s booming housing prices.
The law, which passed late on Wednesday, meets a key campaign pledge from Prime Minister Jacinda Ardern, who vowed to make housing more affordable before her election last year.
The new restrictions mean an almost complete ban on non-nationals buying residential property in New Zealand, with only a couple of exemptions.
“This is a significant milestone and demonstrates this government’s commitment to making the dream of home ownership a reality for more New Zealanders,” said Associate Finance Minister David Parker.
He added that the change “ensures that the market for our homes is set in New Zealand, not on the international markets.”
New Zealanders prefer to own their own homes, rather than rent, but record migration levels and a shortage of housing stock have driven up prices.
A government report earlier this year found house prices had risen 30 per cent in the past five years, outstripping income increases by two-to-one, rising to four-to-one in the country’s largest city Auckland.
As a result, it said home ownership had slipped to a 60-year low. Ardern’s government says foreign buyers are a large part of the problem because they outbid locals.
The new rules will prevent foreigners living in countries such as China, the main source of foreign buyers, from buying homes in New Zealand.
However, Australians, the second most common foreign buyers, will be exempt due to free trade agreements, as will Singaporeans.