New restrictions in place for overseas buyers are now in place. However the impact on the property market has already been felt in the 2016 and 2017 year due to two other major changes.
- Bank lending restrictions to overseas buyers through 2016
- Changes to taking funds out of China through 2017
Which types of properties can a foreigner buy?
- Developers of large apartment complexes (20 or more) can apply to sell to overseas buyers
- As far as I can tell commercial properties are not included in the ban
- Buying into a hotel development (20 or more) with conditions
Other non residential properties could be ok, full details here.
Who is allowed?
- New Zealand citizens can buy even if they live abroad
- Australian, Singapore and permanent residents can buy
- An overseas person married to a NZ citizen or permanent resident
Under other certain conditions a non permanent resident may be able to buy, full details here.
Conclusion
If I read the actual rules correctly, there maybe some room for foreign money to still pour into large scale developments and commercial property. Commercial property will become an interesting prospect, we wonder if with the new Unitary Plan a lot of ground retail space will be open for overseas investors.
Either way I haven’t had the feeling that there is a whole bunch of money pouring in currently, the weaker currency may also be pointing to this. This does somewhat place a limit on how the housing market plays out in the future however. It will be political suicide to reverse this type of a rule ever surely. So this could a permanent feature and may have more of a impact in the long run.
Emigrants on work permits will have a lot more hurdles to jump through to buy and will most likely wait on PR’s before committing to NZ.
