Overseas owners selling NZ residential properties at twice the rate they're buying

Property

Foreigners selling their New Zealand residential properties now outnumber buyers by two to one

2nd Feb 21, 12:15pm by Greg Ninness

Overseas owners continue to sell their New Zealand residential properties at twice the rate they are buying them.

There are severe restrictions on the purchase of residential property in this country by overseas buyers, which has seen the numbers fall dramatically over the last couple of years.

According to Statistics NZ, 3796 residential properties were purchased by overseas buyers in 2018, but the numbers dropped sharply to 720 in 2019 and 672 in 2020.

However sales of existing residential properties already owned by overseas persons, have remained relatively stable, initially dropping from 1785 in 2018 to 1298 2019, and then rising to 1374 in 2020.

That meant sales by overseas owners outnumbered purchases by overseas buyers by two to one.

Most of the buying and selling activity was located in the Auckland region, where overseas owners purchased 348 residential properties in 2020 and sold 720.

That was followed by the Waikato where there were 27 purchases and 105 sales, Christchurch 69 purchases and 102 sales, and Otago where there were 54 purchases and 102 sales during the year.

However the Statistics NZ figures do not tell the full story on overseas buyer activity because they only include sales or purchases where the property was bought or sold by an individual under their own name.

The figures do not include transactions made by a company or most family trusts and it is not known how many of these would ultimately have had overseas beneficiaries.

The comment stream on this story is now closed.

You can have articles like this delivered directly to you inbox via our free Property Newsletter. We send it out 3-5 times a week with all of our property-related news, including auction results, interest rate movements and market commentary and analysis. To start receiving them, go to our email sign up page, scroll down to option 6 to select the Property Newsletter, enter your email address and hit the Sign Me Up button.

We welcome your comments below. If you are not already registered, please register to comment

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.

70 Comments

by rastus1 | 2nd Feb 21, 12:24pm 1612221869

'Overseas owner'.
One million new people in the last 10 years no longer qualifying as an OO and we can see how irrelevant this all is.

by karl seastrand | 2nd Feb 21, 12:37pm 1612222653

worthless stats without including trusts and new NZers buying on behalf of relatives and/or clients as well for that matter. And yes what Rastus says above as well.

by tothepoint | 2nd Feb 21, 3:00pm 1612231217

Good - this should increase the supply of property for those living in NZ.

TTP

by Justa comment | 2nd Feb 21, 4:19pm 1612235966

Yes, good for NZers who want a house to LIVE in.

by AKLCrusader | 3rd Feb 21, 9:10am 1612296616

Considering the worsening stats of housing waiting lists, availability, affordability and house price growth, how is that working?
Its an irrelevance.

by paashaas | 2nd Feb 21, 6:14pm 1612242891

As usual you have zero evidence to back your implied assertions ( in this case that there massive buying going on through trusts of behalf or relative ).
No matter what the facts are - it is the "foreigners" fault .

by Rob Reid | 2nd Feb 21, 8:04pm 1612249440

Well, I wouldn't say zero. I knew someone whose wife's family sent $4m from China as soon as she became a resident and she went out and bought 4 Auckland houses. Probably the only time it happened though...

by karl seastrand | 2nd Feb 21, 8:39pm 1612251557

Exactly. It is pretty standard. The FACT that many foreigners are using trusts and new NZers to purchase property for them is another dirty little secret that we are expected to ignore or risk being called xenophobic or racist.

by paashaas | 3rd Feb 21, 11:06am 1612303573

So there is 1 unconfirmed anecdote , on a message board. From that you derive that is is "pretty standard" . More power to you.

Typing FACT in caps does not make it a fact either ...

by fat pat | 3rd Feb 21, 10:51pm 1612345863

The frustration stems from a certain "likelihood". It is likely that the majority of foreign purchases of NZ real estate involve a family trust structure.

by xingmowang | 2nd Feb 21, 1:37pm 1612226237

This misleading picture agian.

Foreigners in NZ are only defined by whoever has an Asian appearance or probably a Chinese sounding name?

very racist.

I'd say Yellow Peril and Chinese exclusion may be well covered on the surface and live well underneath.

Sigh~~~

by Nzdan | 2nd Feb 21, 12:52pm 1612223558

Nothing racist about that? It's a photograph of what looks like a group of people attending an apartment or high rise auction. You're the one pointing out their appearance.

You sound very insecure.

by Te Kooti | 2nd Feb 21, 1:22pm 1612225377

Whether it is racist or not, only the author knows. It is however a photo of a dozen or so exclusively Asian people at what appears to be some sort of property seminar. It strongly implies therefore that the subject of the article, overseas property investors, are Asian. Given that the vast majority of commenters here are opposed to foreign ownership of property, I'd say it was highly questionable.

by Hook | 2nd Feb 21, 1:52pm 1612227174

Agreed. Why wasn't the photo of a group of white American, UK or Canadian investors?.. because it wouldn't fit the narrative of "foreign" investors in many peoples minds. Agree it sets the tone and is at best "questionable"

by loveyourwork | 2nd Feb 21, 2:49pm 1612230596

12 Quarters to December 2020

- Property purchases to country of tax residence: Canada, America, UK combined = 2,412
- Property purchases to country of tax residence: China = 2,928

by Hook | 2nd Feb 21, 2:55pm 1612230911

What's your source?

by NZChinese | 2nd Feb 21, 3:01pm 1612231314

So we are missing "photo of a group of white American, UK or Canadian investors" then...

by loveyourwork | 2nd Feb 21, 3:36pm 1612233360

Stats NZ.

Yes I mean ideally we would want a photo of 60% Asian and 40% white/other. And 50/50 women/men senior management.

Side note - I have no real concern regarding foreign (black,white,yellow,purple) buyers purchasing residential property with our current settings. There are far bigger actors at play. Just yawn at how racism is dropped in everywhere.

by Te Kooti | 2nd Feb 21, 3:42pm 1612233746

It's a bore for you, not so pleasant for those on the receiving end of lazy racial stereotyping which, let's face it, is coming to define NZ these days.

by fat pat | 4th Feb 21, 12:40am 1612352436

I think overzealous political correctness is the worst affliction in NZ culture at the moment, and has been for quite some time.

by NZChinese | 2nd Feb 21, 7:19pm 1612246779

Thumbs up to people who can give numbers. Stats NZ also mentioned this "0.3 percent of home transfers were to people without New Zealand citizenship or resident visas"

OB, as a whole, was like a drop in the ocean in 2020.

Did whoever put up the subject line photo throw out a fat bait and get a few here?

by loveyourwork | 2nd Feb 21, 8:34pm 1612251289

I agree with you, far far bigger factors at play than OB in our housing mess.

Xing decided not to discuss issues but a photo. Chinese represent the majority of the OB. Wouldn't it be more 'racist' if the photo was of people who didn't represent the majority?

I have zero personal issue with OB no matter where from. My issue is with policy makers here for letting it happen. It it a net loss for NZ.

Political correctness hinders the ability to discuss the issues at hand.

by AKLCrusader | 3rd Feb 21, 9:33am 1612297983

Stats NZ data on house sales to tax resident status for the December quarter lists tax residents of China as 0.2%, behind UK, US, and then Australia at 0.6%.
97% went to NZ tax residents, and 1.0% to mixed tax residencies.
Therefore your statement that Chinese represent the majority of OB is not supported by fact. (even though tax residency vs NZ residency aren't necessarily the same thing)

It is possible however that to get into NZ you have to have money or skills, which means that migrants from any country are relatively wealthy, and without homes, so they need to buy and are also more likely to be investors given their relative wealth. This includes Kiwis coming home.

by loveyourwork | 3rd Feb 21, 9:44am 1612298662

I looked at all available Stats NZ data (2017-2020)

by Te Kooti | 2nd Feb 21, 3:39pm 1612233586

It's ok NZC, they get a free pass.

by NZChinese | 2nd Feb 21, 2:36pm 1612229799

Perception is the key.

by jim hansford | 2nd Feb 21, 6:41pm 1612244461

What a load of absolute horse. The old national catch phrase....Xenophobia... 'you are anti foreign buyers because you are racist'. It's good for us... money flowing in. All a load of complete no 8 wire intellect stupidity. I am anti foreign buyers because it makes no economic sense , the foreign money flows in, and as we are seeing now an even greater amount of our money flows out. It all goes to people who pay no tax in our economy and... deprives Nzers of a critical resource in short supply. Te Kooti, Hook... the old catch phrase is getting a bit tired... Whip out the fencing pliers,, scratch around in the grey matter.. and come up something other than.....wait for ....it Xenophobia....

by CWBW | 2nd Feb 21, 6:52pm 1612245143

That makes a good paragraph for The Manifesto.

by Te Kooti | 2nd Feb 21, 7:01pm 1612245692

Since I have the time today......

Firstly, this thread has predominantly been criticising the use of a lazy stereotypical photo of young Asians despite 45% of foreign buyers being white. I have not raised the subject at all of whether foreign buyers are positive or negative. You could argue this either way, I think in general it is a positive which your stunted reasoning has failed to discuss cogently in any capacity whatsoever. Your reference to foreign buyers not paying taxes is puddle-deep thinking.

by jim hansford | 2nd Feb 21, 8:17pm 1612250253

Well come on then. Please state clearly .. cogently if you prefer.. why it is such a good idea.. Is it because it supplies available rental homes. Yet more money going off shore. If it is not yet another tax dodge rented to a family member studying in New Zealand. IS it because it provides housing supply through new builds... housing supply in a market that is driven stratospheric by the very action that supposedly creates supply. Pricing that can only be maintained through the raiding of savings accounts and the maintenance of CPI figure that is more akin to the will-of-the wisp than any meaningful financial indicator.... make the argument.. it's a good idea.. Why?

by jim hansford | 2nd Feb 21, 8:51pm 1612252303

This is when they normally trot out that other explanation created with the mindless dexterity of a north sea fog, and recounted blindly by property investors the world over. "Trickle Down Eeconomics..."

by NZChinese | 2nd Feb 21, 2:40pm 1612230013

LOL, either Dan or XIngmo needs to visit Specsavers just saying.

by karl seastrand | 2nd Feb 21, 8:40pm 1612251632

Nzdan...To be fair, it does look rather like a group of Canadian property investors. LOL

by nigelh | 2nd Feb 21, 8:48pm 1612252121

from Vancouver no doubt

by loveyourwork | 2nd Feb 21, 1:08pm 1612224524

Not racist or misleading. Try again.

by Chris-M | 2nd Feb 21, 1:06pm 1612224402

Maybe they have concluded that the prices are unsustainable and are cashing out? Maybe the government believe this also and are petrified of doing anything that will precipitate a crash?

by HeavyG | 2nd Feb 21, 1:13pm 1612224816

Maybe they don't like the idea of tenants painting the walls black and letting their pets piss and shit all over the place. A boon for some FHBs and landlords willing to tuff it out.

by Sluggy | 2nd Feb 21, 1:25pm 1612225551

Those bloody tenants. We should deport them all. Leper colonies style.

by karl seastrand | 2nd Feb 21, 1:45pm 1612226714

As long as the Govt can make arrangements for the AS to be paid directly to landlords in the tenants absence. We wouldn't want them to have to eat cake.

by Li quid | 2nd Feb 21, 2:02pm 1612227776

Are there any queers in the theater tonight?
Get them up against the wall!
There's one in the spotlight, he don't look right to me,
Get him up against the wall!
That one looks Jewish!
And that one's a coon!
Who let all of this riff-raff into the room?
There's one smoking a joint,
And another with spots!
If I had my way,
I'd have all of you shot!

by Hook | 2nd Feb 21, 2:53pm 1612230783

They were a great band weren't they?
Gilmore cut some pretty good listening too when he went out on his own

by karl seastrand | 2nd Feb 21, 5:01pm 1612238481

The Wall... what a wonderful thematic movie. Geldof brilliantly cast. Amazing soundtrack of course. Anti-war, anti racism etc. A very deep protest against human nature and society in general. Yet I still recall that when it was released some Jewish groups were trying to have it banned.
They were too stupid to realise that the movie was a protest against war and racism amongst other things.

by Carlos67 | 2nd Feb 21, 1:50pm 1612227041

Yes lets be honest, tenants are generally a nightmare. There is a reason they are renting and not buying a house.

by Hook | 2nd Feb 21, 1:54pm 1612227253

And that reason would be...? Please elaborate

by Shoreman | 2nd Feb 21, 2:43pm 1612230219

Carlos - That's a bit unfair re tenants being a nightmare ! I've been a landlord for 38 years and had probably 100 sets of tenants and had trouble with only 1. Currently have 6 sets of tenants whom all are very pleasant !

by Rosenstein | 2nd Feb 21, 2:43pm 1612230235

"For what good is there to gain a housing portfolio, but to lose your soul?" - Interesticus 4:8

by karl seastrand | 2nd Feb 21, 5:20pm 1612239617

Carlos67... I was a (multi property) landlord for 25 years. One minor problem which cost me $1000 and the rest was totally smooth sailing. Not coincidentally, I inspected once a year max, NEVER increased rent on an existing tenant and treated my tenants with fairness and respect. Many landlords bring problems on themselves by increasing the rent (substantially) every year or even more often, insisting on inspections where they become anal about small issues. Of course many tenants will respond by causing issues. If you have had a number of bad experiences with tenants you have either been very unlucky or you need to look at yourself. Nowadays young people are renting simply because they were not born into a family that can financially assist them and therefore I feel it is unfair to say there is a reason they are renting.

by pacifica | 3rd Feb 21, 11:41pm 1612348863

Sure, being disabled they can legally be paid less than $3 an hour and only one in four will ever find anyone to employ them, add to that the being severely crippled in a wheelchair and you can easily see why banks turn them down for mortgages even when a couple earning above $80k each. Just wish I saw it earlier, you know, before the whole being crippled thing. That was oh 6 years ago. Just guess what banks think of the disabled now, they will not even hire them remotely because remote working is only for the able bodied. Next time check your privilege, it is between the screen and the chair. Glad I know time will even the score between us. Just a pity you are not more open minded now. But that is ok, fun fact if you have over 80% deposit & can cover the mortgage banks still will not lend to you. Guess what the options are because you cannot rent and you cannot go on any housing waitlist at all because the govt also discriminates against the disabled even when homeless with no accessible homes to rent. If you guessed living in a van or garage you would be right. Thank god for covid closing the borders and post lockdown having less tenant competition so landlords had some pressure to rent to disabled folk. Pity it was only one in a country of thousands homeless disabled folk and thousands of landlords with empty accessible properties. Guess what it would take for more than two landlords to rent those accessible homes now.

by twoturntablesa… | 3rd Feb 21, 11:40am 1612305639

Went with a friend to visit a rental. One one of the bedrooms had been painted black. I asked the landlord if he'd paint it a lighter colour as my friend had a child who, if the rental application were successful, would be staying in the room in question. No, the landlord replied, he wouldn't paint it, but he'd supply a fridge and fix the broken kitchen window.
We moved on to the next viewing after that.

by Fritz | 2nd Feb 21, 1:59pm 1612227564

Nah, it's because of the foreign buyer restrictions. It's just harder to buy, so fewer are buying.

by CWBW | 2nd Feb 21, 2:58pm 1612231129

This is a great opportunity for the astute investors to enhance their portfolio and beating the general property market. Most of these overseas owned properties are highly prized assets located at exceptional locations throughout the country. Some of these opportunities also comes in the form of pre-landbank parcels; in which at the point of new investor acquisition, would immediately release it's gains in the form of reduction in landbanking outlay. I would say it needs work (and all the worth) to find out who in this peculiar group intends to sell before it goes online and you need to be quick and precise on the revaluation as well as identifying hidden value of the potential transaction.

We are absolutely on track towards a record year for the property market in 2021.

Come to think of it, all artists have beards, all women wear skirts, and of course all property investors are Chinese. Let them blame the Chinese, if anything, it actually help squeeze more valuable assets out for sale- yes there are opportunities to be captured even in racism.

How unfortunate for the flat earth theorists that this article actually offered no data to help them revise a new version of flat earth but instead torpedoed it.

by karl seastrand | 2nd Feb 21, 5:28pm 1612240109

CWBW... how is your beautiful secretary going with that 70 year graph comparing house prices and rents with work visas and immigration? She can drop it on your desk together with that piece of humble pie and an Irish coffee for your afternoon tea.

by CWBW | 2nd Feb 21, 7:13pm 1612246380

I did consider your request yesterday and concurred that it's a waste of time on write-offs on the internet. If you have any evidence to counter my claims, feel free to post it- I'm all ears. You don't have any do you and I caught you pants down. My secretary has probably has more important task than you down in Naki and yesterday was an exception. Since you are that adamant on how right your are, why not you compile the data and prove your counter claim. I can't help but think the education system has fallen quite a bit over the years in Taranaki.

by Yvil | 2nd Feb 21, 3:00pm 1612231212

House prices rising in NZ has often been blamed on "foreigners". Now foreigners are net sellers but house prices are skyrocketing more than before. Looks like blaming the foreigners was nothing more but narrow minded xenophobia

by Hook | 2nd Feb 21, 3:24pm 1612232660

Foreign buyers were never really that big an impact. But it did make wonderful clickbait for lazy MSM journo's and the general population lapped it up like gravy.

by company of heroes | 2nd Feb 21, 4:07pm 1612235272

It started with foreign buyers pushing the housing prices up and then when foreign investors got banned, locals jumped on board and continue to push the prices up. The governments never release the true detailed data of Foreign buyers percentage in big cities between 2014-2017. Easy theory, if the price is pushed high enough, then everyone wants to take part of that and that will just push the price higher. You can check current gamestop situation as one example.

by Hook | 2nd Feb 21, 4:44pm 1612237466

Interesting that you say Foreign buyers pushed the price up then go on to say there's no empirical Govt stats, so really your theory is more based on assumption and bias than evidence regarding them.
I do agree that once the feeding frenzy started it was self perpetuating though, just not sure you can lay the blame at offshore buyers feet

by estateagent | 2nd Feb 21, 6:14pm 1612242879

Actually made quite a big impact in Auckland - 19% of sales in first quarter of 2018 alone! https://www.nzherald.co.nz/business/1-in-5-central-auckland-homes-sold-…

by karl seastrand | 2nd Feb 21, 5:51pm 1612241515

Yvil.... the odd post on here has mentioned foreign buyers as the problem but I think it is fair to say that far more posts raise (valid) concerns about the huge number of immigrants who are permitted to become permanent residents here and (rightly IMO) contend that this is one of the biggest factors responsible for out of control rents and house prices and the misery they cause.

by MrsWong | 2nd Feb 21, 3:17pm 1612232259

Poor choice of stock photo. Photo file name says Chinese buyers but article is about foreign buyers.

by Hook | 2nd Feb 21, 3:27pm 1612232821

Agreed. And from memory that photo was of prospective investors at a Chinese based property dealer's open day - certainly not here.

by Averageman | 2nd Feb 21, 3:52pm 1612234322

If jnr cant attend school or uni, and there is more supply coming in stream the why not sell at the current printed peak. Photo is a bit click bait but I'm sure there are some Chinese among the sellers.

Moving on.

by karl seastrand | 2nd Feb 21, 5:41pm 1612240901

Not so long ago there was a constant stream of (mainly)) corrupt Chinese public servants removing their ill gotten gains from their homeland so that it would be safe from confiscation. The CCP has tightened up on (unaccounted for) money leaving the country and therefore fewer Chinese are able to purchase property here.

by estateagent | 2nd Feb 21, 6:12pm 1612242739

Back in June 2018 Statistics NZ reported that in the first quarter of 2018 across NZ 3% of homes sold to foreign buyers however in the Auckland region it was a major factor in sales:

“In the Waitemata region, 450 properties were sold to foreign buyers. That amounted to 19 per cent of the sales in the area, which includes the Auckland CBD, inner city suburbs and Waiheke Island.”

Agents know it was much higher than 19% in Auckland during the 2014 to 2017 period!

https://www.nzherald.co.nz/business/1-in-5-central-auckland-homes-sold-…

by karl seastrand | 2nd Feb 21, 9:17pm 1612253871

Exactly, and where do the most serious issues exist. Auckland. OFC anyone who suggested we publish figures of the number of homes bought by people who were not NZ residents or citizens pre 2000 would be vilified as a racist. But those numbers would paint a stark illustration of how much harm our immigration settings have done to our goal of an inclusive society.

by PandaMonium | 2nd Feb 21, 7:47pm 1612248474

How come they are still buying? I was told there was a ban on overseas owners?!

by karl seastrand | 2nd Feb 21, 9:19pm 1612253985

No ban on buying through a trust or getting a relative or friend with newly minted citizenship to buy for you.

by GV 27 | 3rd Feb 21, 7:28am 1612290480

Or on overseas-based Kiwis. Or Australians. Or Singaporeans. The FBB is a joke.

by pacifica | 3rd Feb 21, 11:48pm 1612349303

Don't forget companies guys. Get an investment/entrepreneur visa, start a company, renting houses or managing housing for a social organisation/property management company. Then sell when the market is booming a few years later and upgrade; to better housing with residency. Job done.

by totara | 5th Feb 21, 11:00am 1612476055

The figures cited only cover individuals. Who has the figures for overseas investors using trust and company intermediaries?