Foreign ‘speculators’ house ban

The Labour led government has announced it is following through on a policy promise to ban non-residents or non-citizens from purchasing existing homes. Australians are excluded from the ban.

This has support from NZ First and the Greens.

NZ Government press release:


Foreign speculators house ban

Foreign speculators will no longer be able to buy houses in New Zealand from early next year, says Prime Minister Jacinda Ardern.

“We are determined to make it easier for Kiwis to buy their first home so we are stopping foreign speculators buying houses and driving up prices. Kiwis should not be outbid like this.

“That is why we are introducing an amendment to the Overseas Investment Act to classify residential housing as “sensitive”. This means non-residents or non-citizens cannot purchase existing residential dwellings. Australians will be exempt as New Zealanders are in Australia.

“We expect legislation to be introduced before Christmas and take effect immediately once passed early in 2018. This will fulfil one of our key 100 Day Plan pledges.

“The previous National government chose to put foreign speculators ahead of Kiwi families, but we have chosen to protect Kiwi families and New Zealand’s best interests.

“That government claimed this could not done without breaching other free trade agreements and that a stamp duty would be the only effective tool.

“The advice we have had from officials is that we can give effect to the ban by a simple amendment to the Overseas Investment Act without breaching any agreement except the Singapore Closer Economic Partnership. The options with Singapore will be worked through.

“The proposed change means we can move our focus away from land issues at the negotiating table at APEC when negotiations on the TPP reach their final stages, and focus on Investor State Dispute Settlement clauses.

“We are concerned by ISDS clauses in the proposed agreement. These confer greater rights on multi-national companies investing in New Zealand than a New Zealand company has.

“We remain determined to do our utmost to amend the ISDS provisions of TPP. In addition, Cabinet has today instructed trade negotiation officials to oppose ISDS in any future free trade agreements.

“The change we have announced today are supported by all parties to the government.

“New Zealanders should be assured that the government I lead will have their best interests at heart when negotiating any free trade agreements.”


This was covered in the prime Minister’s post-Cabinet Press conference:

80 Comments

  1. Alloytoo

     /  October 31, 2017

    Seriously?

    How can we expect our trading partners to abide by our FTAs if we’re going to engage in banana republic tactics

    • PDB

       /  October 31, 2017

      Yes – it’s not a ‘ban’ but instead a bit of post-trade agreement jiggery pokery in extending out the ‘sensitive’ classification to cover all existing housing stock.

      • Conspiratoor

         /  October 31, 2017

        It’s a genuine attempt to address housing prices and get kiwis into their first home pants. I don’t think even a diehard nat fanboi like yourself could argue the last lot had any answers

        • PDB

           /  October 31, 2017

          The fact they are govt will see house prices drop anyhow as the cost of living rises and the New Zealand economy stalls.

          • Conspiratoor

             /  October 31, 2017

            The cost of living was rising before they took the reins. Who does the food shopping in your house?

            • PDB

               /  October 31, 2017

              You haven’t seen nothing yet……..brace yourself. Interest rates, inflation, imported goods, and fuel prices jumping will be but a start.

            • Fight4NZ

               /  October 31, 2017

              And that’s going to touch the rise in house prices in the last 9 years?
              The sole economic strategy we’ve had?
              Note to self: source unreliable, signs unable to read or do maths, while confidence inexplicably high.

        • Stalling the average house price in AUCKLAND at a million won’t get anyone in a house

    • PDB

       /  October 31, 2017

      Joyce: “Finally, if the idea gets over all the hurdles, would it actually work in terms of satisfying the concerns of our trading partners? It appears on the face of it that it would treat investors from other countries less favourably than New Zealand investors.”

      • Blazer

         /  October 31, 2017

        Joyce is so yesterday..belongs in a ..Zoo.

        • PDB

           /  October 31, 2017

          Very successful businessman……..hey, what about Grant Robertson who wasn’t a successful businessman?

          Wikipedia: “studied political studies at the University of Otago, graduating with a Bachelor of Arts with honours in 1995.[5] His honours dissertation studied the restructuring of the New Zealand University Students’ Association in the 1980s”.

          • Blazer

             /  October 31, 2017

            Try David Parker…Bill English was good with the sheepish and…ewe.

            • PDB

               /  October 31, 2017

              Is David Parker the finance minister?

              “The economy is in a good shape with no immediate signs of a much vaunted slowdown, the fall in the currency was not unexpected, and the Reserve Bank will get a shake-up in its structure and policy instructions.
              Those are the early views of the new Minister of Finance, Grant Robertson, who said he planned to be an active but inclusive manager of the economy.”

              What was Ardern and Winston on about then with their tales of economic doom and gloom?

            • Blazer

               /  October 31, 2017

              @PDB..how long has this Govt been governing?Save it.

    • Blazer

       /  October 31, 2017

      Funny guy.Do you want to gift wrap the whole of NZ and sell it all to foreigners.How come they’re so dumb and don’t allow foreign buyers of their land.

      • PDB

         /  October 31, 2017

        But this change by the Labour govt doesn’t stop foreigners buying NZL land?

    • Blazer

       /  October 31, 2017

      spoken like a true speculator.Where can foreigners pop in and buy existing land and housing stock?

      • PDB

         /  October 31, 2017

        Only property I own is my own house – I’ve taken advantage of historically low interest rates and paid down my mortgage therefore have no skin in the property speculator game.

        • Blazer

           /  October 31, 2017

          very cute..and the family trust?

          • PDB

             /  October 31, 2017

            None of that either. I’ve personally no sympathy for anybody who mortgaged themselves to the hilt when interest rates do finally rise.

            • Blazer

               /  October 31, 2017

              O.K so an investor not a speculator,and your equity does not match the banks.Too much interest in this to be a bystander…PDB.

        • Fight4NZ

           /  October 31, 2017

          Then you have woefully missed the entire point of the last government. Kinda takes the edge off all that strident support if you don’t grasp the basic economic settings.

  2. Blazer

     /  October 31, 2017

    Wonderful news.Only the selfish,the greedy and the unpatriotic would oppose it.Of course they know little will change because only 3% of properties are sold to foreign buyers…right…thats right eh!

  3. Corky

     /  October 31, 2017

    OK, who wants to be a realty sales person for a couple of months. Get in early folks before the economy tanks.

    • Blazer

       /  October 31, 2017

      Are you implying the ‘strong economy’ is predicated on…property inflation?

      • Corky

         /  October 31, 2017

        Not necessarily..more predicated on international trust, and not backtracking on agreements.
        While nothing major, it will be noted. Remember, perception is everything.

  4. Ray

     /  October 31, 2017

    Funny, Australia has this and capital gains tax, still has the some of most expensive house price to income in the world.
    http://www.abc.net.au/news/2017-09-20/house-prices-overvalued-by-up-to-30pc-in-biggest-capitals/8965150

    • PDB

       /  October 31, 2017

      Which is the obvious point – it is predominantly New Zealand buyers that have pushed up house prices, not overseas investors who make up only 3% of official figures and even taking Andrew Little’s suggestion that this figure is understated by 75% then only 5-6% of total NZ house sales at most.

      • Blazer

         /  October 31, 2017

        if you honestly believe this to be true..’who make up only 3% of official figures ‘..you need help.

      • Patzcuaro

         /  October 31, 2017

        If only 3-6% of house buyers are overseas investors, locking them out won’t effect prices. Let’s just do it and see what happens.

      • Revel

         /  October 31, 2017

        Mummy and Daddy middle class white investors. The same sorts who used to put money into finance companies have all rushed to buy 2nd and 3rd homes and now cry when little Johnny or Jane cannot afford a home with the grandkids within 50 kms of them.

    • Blazer

       /  October 31, 2017

      Not really ‘funny’.Foreign buyers build and buy new properties increasing supply,and residents benefit.Greedy neo liberalism caused the inflation in property prices in the West.The ‘printing’ of trillions of U.S dollars lead to a rush to hard assets.Property being the tried and true favourite.

  5. David

     /  October 31, 2017

    Quite an elegant solution Ardern, well done.

    • Conspiratoor

       /  October 31, 2017

      Piss take? Please elaborate

      • PDB

         /  October 31, 2017

        If they get away with it (without upsetting our trade agreement partners) then David is correct.

        • Conspiratoor

           /  October 31, 2017

          In what sense are the chinese our ‘partners’

        • Blazer

           /  October 31, 2017

          why do we have to tiptoe around our trade partners?We have great products,great people and options.Get off your fucking knees FFS .Arab Shieks,multi national corporate suckholing,that was yesterdays Govt.

          • PDB

             /  October 31, 2017

            We are a small country at the bottom of the earth of little importance to other countries – either you have no idea on how dependent we are upon trade with other countries or are a closest Trump fan.

        • PDB

           /  October 31, 2017

          To add though, that is talking about the act of banning foreign buyers of existing stock – it will have no effect on house prices in the long term, the prices of which are driven by kiwi buyers/investors & other issues such as land supply and red tape.

          • Blazer

             /  October 31, 2017

            ‘ it will have no effect on house prices ‘…well don’t blow a foo foo valve over it then.Interest rates and credit supply are the deriving factors.Raise interest rates to reward savers,and choke supply of finance to parasitical endeavour and we are on our way .

            • Alan Wilkinson

               /  October 31, 2017

              It will have no perceptible effect on house prices. It will of course hurt some insignificant individuals whom the Left just regard as collateral damage in pursuit of their fantasies.

      • David

         /  October 31, 2017

        No piss take its an innovative solution but in all evidence to a marginal issue, National should have over rode Len Brown and did what they did to Christchurch,s council and forced new land to be opened up. The foreign purchase is too small a part of the market to make any difference to the overall level of prices, as in Australia, but it was a campaign promise fulfilled.

    • Elegant ?

      Racist
      Culturally exclusive
      Aussies ( largest group of buyers) still there.

      Why don’t they just build a wall

      • Blazer

         /  October 31, 2017

        what are you worried about then?

      • Revel

         /  October 31, 2017

        Because the Pacific Ocean works just fine.

      • David

         /  October 31, 2017

        I still think its a stupid policy from race baiters who are the lowest form of pond life but it was a promise.

  6. Alloytoo

     /  October 31, 2017

    The saddest thing about this policy is they think they’re being clever….

    • Blazer

       /  October 31, 2017

      When did being clever invoke sadness…envy in your case..I would understand.

      • alloytoo

         /  October 31, 2017

        Cleverness invokes admiration. Dunning Kruger sufferers invoke sadness

    • Alan Wilkinson

       /  October 31, 2017

      Exactly, Alloytoo. Political idiots producing a fantasy solution to a fantasy problem and patting themselves on the back while pointing new barriers to individuals solving their own problems. Precisely what the Left do every day of their lives. Pathetic.

  7. Fight4NZ

     /  October 31, 2017

    Properties bought by overseas based non kiwis is probably not a big number.
    Properties bought by those with NZ residence and far larger financial resources than a ordinary or even the more comfortable have had a massive effect. Prices 6 or 8 times the median income did not come about through locals selling among themselves either here or in the numerous other places around the world that have been hit by it.
    This policy will do little. The best possibility is that it will get us out of another bs FTA.

    • Alan Wilkinson

       /  November 1, 2017

      Apart from the last sentence you are correct. America has printed money to pay for Asian imports and this is the consequence aggravated by our political bureaucracy preventing supply.

  8. Alan Wilkinson

     /  November 1, 2017

    Hosking describes it as xenophobic bollocks and the work of inexperienced amateurs. And he is being kind.

    http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=11939190