General policy statement
This Bill amends the Overseas Investment Act 2005 to apply new restrictions on non-resident purchasers of New Zealand residential properties in order to better protect New Zealand homebuyers.
Housing affordability has significantly declined in recent years as a result of lack of housing supply coupled with increased demand from speculators. Imposing restrictions on non-residents purchasing property in New Zealand should improve home affordability. Overseas investment in residential property should be permitted only when it brings value to New Zealand and does not harm first home buyers.
Under the provisions of this Bill, non-residents will be granted permission to purchase a residential property only if they intend to live here permanently or their purchase adds to our existing housing stock. For example, a non-resident wishing to purchase vacant land with a commitment to begin building a new dwelling within 12 months will be likely to have their application granted.
Students, skilled migrants, and other persons temporarily resident in New Zealand for 12 months or longer will be granted approval to purchase a house on the condition that it is sold if they leave. Allowing people to
“test the waters” before moving here means we can still attract the talent our economy needs.
Any non-resident person found to have purchased a residential property without Overseas Investment Office approval could be forced to sell the property, which may cause them loss. A fine may also be imposed in some cases.