New exemption for investors
Overseas-based investors holding an investor residence visa will now be allowed to buy a house in New Zealand, Prime Minister Christopher Luxon (pictured) has announced.
The visa is available to those who invest a minimum of $5 million into New Zealand, pass a good character test, and have acceptable health.
“The minimum value of a house that could be bought by the visa holders was $5 million, a price tag on less than 1% of New Zealand's housing supply,” Luxon said, emphasising that the broader ban on foreign buyers, introduced in 2018, remains in place, 1News reported.
NZ First leader Winston Peters previously stressed that the foreign buyers ban would remain, but signaled openness to targeted exemptions for high-value investors – a move now being realised as global demand for investor visas stays strong.
“This change navigates a path between those who do not want foreign ownership opened up, and the desire to attract high net worth investors by deepening their connection to our country to help grow the economy,” Luxon said.
“There have been more than 300 applications for the Active Investor Plus residency visa since it was re-launched on April 1. If all these applications are approved and proceed, it means a potential total minimum investment of $1.8 billion in the New Zealand economy.”
Strict limits to protect local market
“The foreign buyers ban on housing remains,” said Peters, who helped introduce the 2018 ban. “However, as we signalled months ago, we have agreed that holders of a current existing Residence Class ‘Active Investor Plus Residence Visa’ holders, who are investing millions of dollars into our economy, should be able to own a home.
“We have ensured that there are tight restrictions on eligibility and what these current residence visa holders can purchase,” he said. These Investment Visa holders will be restricted to only one home, either purchasing an existing home or building a new home, with the value of that home being a minimum of $5 million.
“This will exclude over 99% of New Zealand homes on the market, protecting the vast majority from sale to foreigners, and will not affect the wider housing market for Kiwis.”
Government defends move as win-win
ACT leader David Seymour argued that New Zealand should welcome foreign investment. “New Zealand needs foreign investment, but foreign investment does not need New Zealand,” Seymour said. “We can’t afford to turn our nose up to friends around the world who want to bring their money and their know-how to this country.”
Seymour added that if wealthy investors want to buy a home – without impacting first-home buyers – “we should see that as a massive win-win and a massive step forward for New Zealand and the Government.”
Critics warn of higher prices and inequality
Labour housing spokesperson Kieran McAnulty criticised the exemption, saying it would drive prices up and make life harder for New Zealanders wanting to own their own home.
The “announcement shows how out of touch Christopher Luxon is,” McAnulty said. “Many Kiwis are already struggling to buy a home, and he has just made it worse. More pressure at the top end pulls up house prices for the average Kiwi. New Zealanders should be at the top of the priority list for houses.”
He added, “People cannot afford the basics at the supermarket, but Christopher Luxon made it his priority to drive up house prices again anyway.”
Green Party housing spokesperson Tamatha Paul described the move as “rolling out the red carpet for rich investors.”
“Last week Christopher Luxon said he wanted to see house prices increase, and now he’s working to make that happen despite many crying out for the ability to access home ownership and all of the benefits that come with it,” Paul said.
“Real estate agents will have every incentive to boost prices to $5m in order to sell to this new wealthy market, further shunting struggling renters and home-buyers out of contention.”
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