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New Zealand bans foreigners from buying property

Summer Sweetie

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Buying a home in New Zealand just got a lot tougher for most people.

The country's parliament on Wednesday passed a law banning foreigners from buying into most parts of its residential property market as the government seeks to cool red-hot house prices.

The Overseas Investment Amendment Bill will prevent overseas investors from purchasing existing properties in New Zealand, but they will still be able to buy into new apartment complexes and certain other parts of the housing market.


New Zealand Prime Minister Jacinda Ardern campaigned on a promise to clamp down on foreign buyers, blaming them for soaring prices that have left many New Zealanders unable to enter the property market.

"If you've got the right to live in New Zealand permanently, you've got the right to buy here," Trade Minister David Parker said during a final debate on the bill Wednesday. "We believe it's the birthright of New Zealanders to buy homes in New Zealand," he added.


Public policy firm Demographia regularly ranks Auckland, New Zealand's biggest city, as one of the world's least affordable places to buy a home.

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House prices have almost doubled over the past decade, according to central bank data, and are up more than 5% so far this year. Home ownership rates among New Zealanders have also been falling in recent years.

But government data suggests that foreign buyers actually only make up a small part of the country's housing market. According to the latest official statistics, purchasers who don't hold New Zealand citizenship or residency make up less than 3% of total transactions.


Most foreign buyers in New Zealand don't state where they're from, official data shows, but the majority of those who do are from China.

New Zealand has also proved to be a popular retreat for the rich and famous. Billionaire investor Peter Thiel and disgraced former NBC host Matt Lauer both own properties in the country.

Analysts say it's still unclear how much difference the new law will make.

"We simply do not know how it will affect the market," Dominick Stephens, chief economist at the New Zealand division of banking group Westpac, said in a note to clients Wednesday. House prices could stop rising before the end of the year or even begin falling, he predicted.

Nearby Australia has also tried to slow runaway house prices with measures including a similar ban on foreign investors buying existing properties. Prices in the country have been falling since the end of last year.

The new law in New Zealand doesn't apply to Australian and Singaporean buyers because of existing arrangements between the countries. It still needs to receive royal assent, which is a formality, before it comes into force.


New Zealand bans foreigners from buying property
 

M3ander

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Read about this a couple of days ago.

Good for them, although I wonder if these rich people purchasing land to build bunkers and fallout shelters know something that we don’t....
 

Ace Deucey

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Good. I don't know why more countries don't adopt this policy. I know they do something similar in Tonga.
 

DominaHW

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Good for them. England and the US should do the same, but we know they won't because it's all about money to them.
 

VivianDoubt

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This doesn't make sense, not that I want to live in that country any time soon, but I do want to buy a summer home in Paris or La Guardia or some other country that s cultured and beautiful.
Not sure why blames the foreigner for this one thing when this statement exists:

Tourism
comprises an important sector of the New Zealand economy, directly contributing NZ$12.9 billion (or 5.6%) of the country's GDP in 2016, as well as supporting 188,000 full-time equivalent jobs (nearly 7.5% of New Zealand's workforce). A further 4.3% of GDP (or NZ$9.8 billion) is indirectly contributed through the flow-on effects of tourism. Spending by international tourists accounted for 17.1% of New Zealand's export earnings (nearly NZ$12 billion). International and domestic tourism contributes, in total, NZ$34 billion to New Zealand's economy every year.

Tourism in New Zealand - Wikipedia
 

biglittlelies

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This doesn't make sense, not that I want to live in that country any time soon, but I do want to buy a summer home in Paris or La Guardia or some other country that s cultured and beautiful.
Not sure why blames the foreigner for this one thing when this statement exists:

Tourism
comprises an important sector of the New Zealand economy, directly contributing NZ$12.9 billion (or 5.6%) of the country's GDP in 2016, as well as supporting 188,000 full-time equivalent jobs (nearly 7.5% of New Zealand's workforce). A further 4.3% of GDP (or NZ$9.8 billion) is indirectly contributed through the flow-on effects of tourism. Spending by international tourists accounted for 17.1% of New Zealand's export earnings (nearly NZ$12 billion). International and domestic tourism contributes, in total, NZ$34 billion to New Zealand's economy every year.

Tourism in New Zealand - Wikipedia

there is no country on earth called La Guardia and Paris isn't a country. Paris is also one of the most expensive cities in the world so good luck with that summer home girl.
 

VivianDoubt

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there is no country on earth called La Guardia and Paris isn't a country. Paris is also one of the most expensive cities in the world so good luck with that summer home girl.
You don't have to tell me where those cities are. I didn't give the country because I figured you already knew I was talking about France and Nicaragua.
FFS.
Take the petty negativity with you elsewhere.
 

SuccessfullyMe

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This doesn't make sense, not that I want to live in that country any time soon, but I do want to buy a summer home in Paris or La Guardia or some other country that s cultured and beautiful.
Not sure why blames the foreigner for this one thing when this statement exists:

Tourism
comprises an important sector of the New Zealand economy, directly contributing NZ$12.9 billion (or 5.6%) of the country's GDP in 2016, as well as supporting 188,000 full-time equivalent jobs (nearly 7.5% of New Zealand's workforce). A further 4.3% of GDP (or NZ$9.8 billion) is indirectly contributed through the flow-on effects of tourism. Spending by international tourists accounted for 17.1% of New Zealand's export earnings (nearly NZ$12 billion). International and domestic tourism contributes, in total, NZ$34 billion to New Zealand's economy every year.

Tourism in New Zealand - Wikipedia

If you are visiting you don't need a home there. It's a nice to have but it makes things unaffordable for people actually living there. A summer home is nice, but you don't live there 70 percent of the time and they rather have someone that lives there 100 percent of the time there. Also, they didn't say that people couldn't buy anything they are just limiting what can be bought. If that was adopted in NYC ... way more property would be available.
 

VivianDoubt

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If you are visiting you don't need a home there. It's a nice to have but it makes things unaffordable for people actually living there. A summer home is nice, but you don't live there 70 percent of the time and they rather have someone that lives there 100 percent of the time there. Also, they didn't say that people couldn't buy anything they are just limiting what can be bought. If that was adopted in NYC ... way more property would be available.
Honestly, I don't care what other people can and can't afford. If I can afford a house and I have a clean record, I don't think it should matter. If I want to buy a house in France and I pay good money on and keep it in working order and nothing goes wrong, who are you to tell me what I can and can't do with my free time?
If I want to go there for one summer out of every three and spend my winters there, let me live my best life.
This is going is going to fµck the market for tourism and sales in certain countries. But who cares, really?
 

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