The Overseas Investment Amendment Act 2018
In 2018, the New Zealand government passed the Overseas Investment Amendment Act to restrict foreign buyers from purchasing residential properties in New Zealand. Under this act, overseas buyers are required to meet specific criteria to purchase property in New Zealand. The primary purpose of this act was to combat skyrocketing house prices in the country and make homeownership more accessible for New Zealanders.
The benefits of buying property in New Zealand
Despite the restrictions, buying property in New Zealand can benefit foreigners. The country offers a high standard of living, a stable political environment, and a strong economy. Moreover, the country’s beautiful landscapes and excellent infrastructure make it an attractive destination for anyone investing in real estate.
The types of property foreigners can buy in New Zealand
Foreigners can buy any property in New Zealand except for residential land. They can buy apartments, townhouses, and commercial properties. However, they need to meet specific criteria to purchase residential land.
The process of buying property in New Zealand
The process of buying property in New Zealand is relatively straightforward. The first step is to find the right property. You can make an offer once you have found a property you like. If your offer is accepted, you must conduct due diligence to ensure the property is worth your price. Finally, you must settle the property by paying the agreed-upon price.
Financing options for foreigners buying property in New Zealand?
Foreigners can obtain financing to purchase property in New Zealand. However, they need to meet specific criteria set by New Zealand banks. This includes having a New Zealand bank account, a steady income, and a good credit history.
What are the rules for foreigners buying property in New Zealand?
Foreigners can buy property in New Zealand but must follow certain rules. If you’re not a citizen or a permanent resident of New Zealand, you’ll need to obtain Overseas Investment Office (OIO) approval before buying any property. You can buy residential property, but there are restrictions on buying certain types of land, such as farmland, forestry, and conservation land.
Is it easy to buy a house in New Zealand?
Buying a house in New Zealand can be relatively straightforward, but it can also be competitive, especially in popular areas like Auckland and Wellington. Working with a reputable real estate agent and getting pre-approved for a mortgage is important before starting your search. You’ll also need to research and understand the local housing market.
Can a foreigner get a mortgage in New Zealand?
Yes, foreigners can get a mortgage in New Zealand but they must meet certain criteria. You’ll need a good credit history and a stable income to qualify for a mortgage. You’ll also need to provide proof of your identity and residency status. Some banks may require you to have a deposit of at least 20% of the purchase price.
Is it expensive to buy a house in New Zealand?
The cost of buying a house in New Zealand varies depending on the location, size, and type of property. Generally, houses in major cities like Auckland, Wellington, and Christchurch are more expensive than in other areas. However, New Zealand’s living cost is generally lower than other developed countries. Researching and working within your budget is important when buying a house in New Zealand.
Pros of buying property in New Zealand for foreigners:
1. Stable economy and political system:
New Zealand has a stable economy and political system, which makes it an attractive destination for foreign investors. The country has a low corruption rate and has been consistently ranked as one of the least corrupt countries in the world.
2. Relaxed lifestyle:
New Zealand is known for its relaxed and laid-back lifestyle. The country offers a great work-life balance, and its residents enjoy a high standard of living. The country is also known for its natural beauty and outdoor activities.
3. High-quality education:
New Zealand has a high-quality education system and is home to several world-renowned universities. The education system is also relatively affordable compared to other countries.
4. Foreign buyer-friendly:
The New Zealand government is foreign buyer-friendly and encourages foreign investment in the country’s property market. The government allows foreigners to buy property in the country, subject to certain restrictions.
Cons of buying property in New Zealand for foreigners:
1. High property prices:
New Zealand has high property prices, especially in major cities like Auckland and Wellington. This can make it difficult for foreigners to buy property in these areas.
2. Currency fluctuations:
Foreign buyers are exposed to currency fluctuations, which can impact the value of their investment. This can make it difficult for foreigners to predict the return on their investment.
3. Limited land availability:
New Zealand has limited land availability, especially in desirable locations. This can make it difficult for foreign buyers to find suitable properties to invest in.
4. Stringent regulations:
Foreign buyers need to follow stringent regulations when buying property in New Zealand. They need to obtain Overseas Investment Office (OIO) approval, which can be time-consuming and complex.
Buying property in New Zealand for foreigners has its pros and cons. The country offers a stable economy, relaxed lifestyle, high-quality education, and a foreign buyer-friendly government. However, the high property prices, limited land availability, currency fluctuations, and stringent regulations can make investing in the country’s property market challenging for foreign buyers. It’s important to research and works with a reputable real estate agent to navigate the complexities of buying property in New Zealand as a foreigner.
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FAQs
Can foreigners buy residential land in New Zealand?
No, foreigners cannot buy residential land in New Zealand unless they meet specific criteria.
What types of property can foreigners buy in New Zealand?
Foreigners can buy any property in New Zealand except for residential land.
Can foreigners obtain financing to purchase property in New Zealand?
Yes, foreigners can obtain financing to purchase property in New Zealand, but they must meet specific criteria set by New Zealand banks.
Is it worth investing in property in New Zealand?
Yes, investing in property in New Zealand can benefit foreigners, including a high standard of living, a stable political environment, and a strong economy.
What is the process of buying property in New Zealand?
Buying property in New Zealand includes finding the right property, making an offer, conducting due diligence, and settling the property by paying the agreed-upon price.
Conclusion
Foreigners can buy property in New Zealand but must meet specific criteria. The Overseas Investment Amendment Act 2018 restricts foreign buyers from purchasing residential land to combat skyrocketing house prices and make homeownership more accessible for New Zealanders. Despite the restrictions, buying property in New Zealand can benefit foreigners, including a high standard of living, a stable political environment, and a strong economy.
