Foreign owners continue to offload their NZ residential properties

Property

Foreign owners selling their New Zealand residential properties at more than twice the rate they are buying them

28th Jul 21, 12:30pm by Greg Ninness

The number of overseas buyers purchasing New Zealand residential property continues to decline dramatically.

According to the latest home transfer figures from Statistics NZ, just 135 residential dwellings were purchased by people who were not New Zealand citizens or residents in the June quarter of this year.

That's down from 1116 in the June quarter of 2018, before restrictions on foreign buyers were introduced for residential property in October 2018.

The latest figures show purchases by foreign buyers were the second lowest of any quarter since Statistics NZ began compiling the figures in the June quarter of 2017.

The only time purchases by overseas buyers have been lower was in the June quarter of last year, when sales came to a virtual standstill for much of the quarter due to the COVID lockdown restrictions in place at the time.

In the 12 months to the end of June this year, 744 residential properties were purchased by foreign buyers.

That compares to 4017 properties purchased by foreign buyers in the 12 months to June 2018.

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The figures also show foreign owners are selling NZ residential properties at more than twice the rate at which they are buying them.

In the June quarter, 366 residential properties were sold by owners who were neither NZ citizens nor residents.

However Statistics NZ's foreign ownership figures are not comprehensive because they do not include transfers made through companies or most trust structures.

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40 Comments

by Ocelot | 28th Jul 21, 12:40pm 1627432814

Some good news. Even though good news doesn't bring much drama, I appreciate it being covered. Cheers.

by Pathos | 28th Jul 21, 12:43pm 1627433006

Why are foreign nationals, some of whom have never set foot in NZ, allowed to buy properties we say we desperately need ourselves in the first place? Who are we building for? The Chinese or ourselves? No foreign national can own any property in China!
Another headline on this site today asks for ideas to prevent money laundering.....well, that's really got me in aching at the sides with laughter.

by Advisor | 28th Jul 21, 1:27pm 1627435648

No foreign national can own any property in China

Has something to do with Chinese meritocrats opening up their economy to foreign investments only in specific high-end sectors (e.g. O&G exploration, intelligent manufacturing, new materials, etc.).

Meanwhile, our government here chases away "polluting" industries, only to ship those goods from other destinations over thousands of nautical miles and try to bridge the resulting current account deficits with capital inflows in real estate and brownfield infrastructure investments.

by apizap | 28th Jul 21, 1:54pm 1627437260

Not only China. We can't buy land in India, Thailand, Vietnam, Philippines, Cambodia..... even the Cook Islands..... and the list goes on. And I'm NOT being racist. I support their stance. Because by the same token, I fail to see why any individual who is not a resident New Zealand citizen needs to own land here. The same goes for any trust, or corporate entity that is not registered in New Zealand and paying tax here, and whose trustees or shareholders are not more than 50% resident New Zealand citizens. Those moves alone won't solve the property crisis in New Zealand, but they would certainly be a game changer!

by Spiceeh | 28th Jul 21, 2:57pm 1627441071

I am yet to confirm, but I heard recently that even most Chinese nationals can't buy land in their own country. They can only lease it for 99 years with the option to renew. Is it any wonder they want to buy where you can own both the home and land. What pisses me off is the purchase of property that then isn't occupied, that's the issue that makes me grind my teeth and want to scream. I don't think anyone should be allowed to property bank both land or housing. If you intend to own property it must be either to reside in it within 12 months or to put it to productive use within 12 months. How quickly would we see investors drop property back into circulation if that was the case.

by imhenry | 29th Jul 21, 8:46am 1627505173

That seems a bit one eyed. telling other people what they can buy and what they can use it for. I am sure i know what the answer would be if i told you what to do with you money

by NZChinese | 30th Jul 21, 10:16pm 1627640218

70 years, not 99

by J.C. | 28th Jul 21, 6:19pm 1627453152

Not only China. We can't buy land in India, Thailand, Vietnam, Philippines, Cambodia..... even the Cook Islands..... and the list goes on.

Madame Xindy said that Chinese are allowed to buy land in NZ because of the FTA. Go figure.

by PocketAces | 28th Jul 21, 8:53pm 1627462433

Yes, well that became the case when a certain National govt signed an fta with South Korea which specifically allowed them to buy here and we then had to offer the same to China.
Labour came up with the idea that all houses would be considered "sensitive" so as too disallow
A bit of getting your facts straight wouldn't hurt, eh?

by Ricardo99 | 29th Jul 21, 9:31am 1627507914

FTA with China was under Helen Clark. Clark encouraged Chinese buyup of NZ realestate. Just helping get your facts right.

by fender bender | 29th Jul 21, 7:16am 1627499772

I believe a couple can only own 3 properties in China, Shanghai at least

by xingmowang | 28th Jul 21, 12:51pm 1627433484

oh. this racist headline picture again.p..

by Brock Landers | 28th Jul 21, 12:59pm 1627433964

What's racialist about it?

by CourtJester | 28th Jul 21, 1:02pm 1627434138

Right? All I see is people who could be native kiwis. Or Germans, Americans, Italians, Mongols, Taiwanese...

by General Comment | 28th Jul 21, 3:15pm 1627442100

I may be wrong, but isn't the scale model in the picture of the North Shore development being built by an overseas company with marketing targeted specifically targeted at overseas investors from the same country as the developer?

by lostinawoods | 29th Jul 21, 2:40am 1627483203

Yeah. So if you put a picture with a group of Black people at the article about, say, NZ gangs that would 100% be racist.
But the picture of a group of Asians at the forum where foreigner property ownership is considered detrimental, yeah nah.

by Cobolt24 | 28th Jul 21, 10:56pm 1627469785

It's not racist exactly but it is implying most of them are from Asia. I think the number one place for foreign buyers was the US before the ban.

by lostinawoods | 29th Jul 21, 2:28am 1627482517

Clearly a racist picture in this context (and I'm not Asian).

by fortunr | 30th Jul 21, 1:09pm 1627607384

I agree. In NZ, while there are certain ethnic groups that are untouchable and cannot be criticized at the risk of being dubbed a racist, when it comes to Asians, and especially Chinese, there often appears to be no such obstacle.
Anti-Asian racism is not only a NZ phenomenon, mind you. It is present in all Western countries, unfortunately. In the US it is quite widespread, for example. The racism in some parts of the UK, especially against some particular Asian Countries, is endemic.

by mikekirk29 | 28th Jul 21, 4:22pm 1627446165

Dairy flat and Okura land ownership and non occupation might lead you to conclude that domestic purchasing at top end was in a minority 2011-16

by Davo36 | 28th Jul 21, 5:08pm 1627448902

Another opaque comment. Can you explain what you mean?

by Chris-M | 28th Jul 21, 5:28pm 1627450094

Take note FHB.
Stand by, don't bail them out and become their escape route.

by fenestrator | 29th Jul 21, 8:28am 1627504127

I hope they believe you

by Davo36 | 28th Jul 21, 5:09pm 1627448964

So we still sold 744 properties to foreign nationals last year. And that's not counting companies or trusts.

And silly me who thought this had been stopped.

by Ricardo99 | 29th Jul 21, 9:25am 1627507559

Sadly our leader tells us whatever is in her head at the time she is being interviewed.

by Averageman | 28th Jul 21, 5:09pm 1627448965

International speculators exiting as they see more downside than upside. Capital gain is only a gain when it's converted to beer tokens in the bank.

by Zack Brando | 28th Jul 21, 5:18pm 1627449535

Once foreign buyers sell, many will find it harder to 'legally' get back in, should they wish to.

Perhaps foreign buyers are calling the top in NZ and cashing out to invest in markets with more potential to bubble up.. perhaps the States?

What do you guys think of that angle?

by Rob Reid | 28th Jul 21, 8:20pm 1627460416

The DFA site had an item months ago reporting that Chinese property investment forums were steering investors away from NZ in favour of economies they expect to do better post COVD, eg Oz. It's unfolding as expected.

by Uncle Bulgaria | 28th Jul 21, 6:25pm 1627453508

How can foreigners buy properties? Isn't there a ban?

by Davo36 | 28th Jul 21, 6:37pm 1627454236

Only for the little people. https://www.brainyquote.com/quotes/leona_helmsley_126543

by Ricardo99 | 29th Jul 21, 9:26am 1627507616

Our leader will tell you there is a ban, but clearly not.

by fat pat | 28th Jul 21, 6:27pm 1627453675

This data excludes trusts doesn't it.

by CWBW | 28th Jul 21, 7:04pm 1627455882

People should be celebrating, but reading the comments above and I can't help but realise nothing will satisfy them. I won't be surprise the same bunch will also complain even if you give them houses for free.

Human nature; they complain about others shifting goal posts but they shift their own all the time.

by HarshaSirisena6556 | 28th Jul 21, 8:31pm 1627461081

Labour's magic bullet to solve the housing crisis was to ban foreign buyer, and it has worked brilliantly, not!

The foreign buyer ban did not apply to Australians and Singaporeans, which explains why there is still some foreign buying.

Kiwis can buy property in the US but US citizens are banned from buying property in NZ. Go figure!

by fat pat | 29th Jul 21, 3:12am 1627485168

Similarly, there is almost no gun crime that’s attributable to registered gun owners now that the government has disarmed law abiding citizens.

by company of heroes | 29th Jul 21, 9:31am 1627507866

New Zealand has the most unaffordable housing in the world. It's the fact. If this can't make you complain about it, I don't know if there is anything else you should complain about. If you search "largest industry in New Zealand in google", what comes out as result? Property!! Lets face it, this shouldn't something we should be proud of. No complaining? How are we going to make improvements? By ignoring the elephant in the room?

by PocketAces | 28th Jul 21, 8:55pm 1627462532

Wow all that lubbly jubbly money that came into the country from foreigners buying all those houses, and now it's on the way back out the door, plus a poultice of profit, straight from here.
If only those of us demanding they be prevented from buying here, were listened to then, we might not be losing all that money to them now.
Don't say you weren't warned

by Nzdan | 29th Jul 21, 6:58am 1627498692

Those profits likely having mortgages attached to them too. Oh wouldn't it be ironic if the lending for those profits came from offshore funding sources, the country of origin being where the profits are heading. "Cant afford to buy your house back? No worries, we will lend you the money with interest."

Would have been quicker and less hassle if we just printed some money and handed it to them, leaving our housing market intact.

by Ricardo99 | 29th Jul 21, 9:29am 1627507763

Of the 100 or so auctions I went to, they were all cash buyers. Housing prices in NZ are a 'rounding' error as far as cost goes for a large number of foreigners. Check out apartment prices in Hong Kong, etc

by TuaWai Smith | 30th Jul 21, 1:59am 1627567150

Just a thought....maybe one reason they are selling is they cant use their properties right now because it costs approx. $10,000-$12,000 for a couple to travel from (for eg.) USA to NZ once you factor in airfares which are double (+) what they used to be and $6000 in quarantine costs ..A bit steep for most people for a few weeks or months of the year to visit family and use their property?