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12/17 05:57
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Relaxation of Ban: New Zealand will ease restrictions on foreign home purchases, allowing wealthy overseas investors to buy a single high-value residential property worth at least NZ $5 million (approximately $3 million). This change is part of Prime Minister Christopher Luxon's strategy to attract foreign investment while addressing housing market concerns.
Background of the Ban: The original ban was implemented in 2018 to mitigate a housing market crisis driven by speculation. The new policy is a partial reversal, aimed at a limited number of wealthy foreigners and specific properties, rather than a full reinstatement of previous regulations.
Golden Visa Program: The reintroduced residency “golden visa” allows individuals investing a minimum of NZ $5 million in New Zealand businesses to gain residency. This program is expected to generate up to NZ $1.8 billion in investment, with over 300 applications received, representing around 1,000 individuals, predominantly from the United States.
Waiving Residency Requirements: Previously, visa holders needed to reside in New Zealand for at least six months annually to qualify for property purchases. This requirement will now be waived, further facilitating foreign investment.
Government's Economic Strategy: Luxon argues that attracting wealthy investors will stimulate economic growth and job creation, positioning New Zealand as a "safe haven" amid global uncertainties.
Opposition Concerns: Critics, including Labour housing spokesperson Kieran McAnulty, argue that this policy exacerbates the housing crisis for locals, as many Kiwis struggle with home affordability, homelessness, and rising living costs.
Current Housing Prices: As of July, the average home price in New Zealand was NZ $767,250, with Auckland's average at NZ $975,000. The new policy allows foreign investors to purchase less than 1% of the housing market, approximately 10,000 homes, primarily in Auckland and Queenstown.
Historical Context of Foreign Purchases: Prior to the ban, about 3% of homes were sold to foreigners, with this figure rising to 22% in Auckland. The policy change has reignited discussions about the impact of foreign investment on local housing affordability.
