Migrants are continuing to make up an increasing proportion of residential property buyers in New Zealand.
Generally you need to be either a New Zealand citizen or hold a residence visa to be able to purchase a dwelling in this country.
The latest property transfer figures from Statistics NZ show the number of dwelling sales to residence visa holders as a proportion of total sales has almost doubled over the last four years.
In the September quarter of 2019 residence visa holders accounted for 8.2% of all residential dwelling purchases, excluding vacant land. By the September quarter of this year that share had increased to 14.3%.
Conversely sales of dwellings by residence visa holders have been declining.
In the September quarter of 2019, residence visa holders were the vendors of 4.4% on the dwellings sold in NZ.
That climbed to 5.1% in the March quarter of 2021 and then steadily declined to 4.1% in the September quarter of this year.
The quarterly trends of sales to or by residence visa holders are clearly shown in the graph below.
However for overseas owners - those people who are neither NZ citizens or holders of a residence visa - the trend is reversed, with them being twice as likely to be sellers of NZ residential property than buyers.
In the September quarter of this year overseas owners accounted for just 0.4% of residential dwelling purchases, but 0.8% dwelling sales.
However the data for sales by or to residence visa holders and overseas owners may be significantly understated, because it excludes sales or purchases made through a company, regardless of where the company owners were based or their residence status, or those sales made by or to a trust where at least one trustee is a NZ citizen or resident, even if the beneficiaries are based overseas.
It is not known how many residential properties are bought and sold in NZ by companies or trusts where the beneficiaries are NZ residence visa holders or overseas owners.
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70 Comments
Let the Ponzi begin again
Luxon will be running around soon saying 3% of the market just like his Mate John Key.
Bad idea NZ ,bad leadership.
You can sense the change in tone of comments as the DGM's time in the sun is over, it started about a fortnight ago. The realisation that the market has bottomed, we now have a very pro-property Govt, migration is at record levels and rents are sky-rocketing.
And you think that is sustainable? There's no way to confirm a bottom is in at the time by the way, you're simply speculating just like everyone else.
Actually no, the evidence is quite conclusive prices have stabilised and are recovering slowly in most regions.
Equity markets have indicated you are incorrect. They have tanked in the last few weeks and are a pretty good aggregator of information and emotion…. much like the property market.
That's not how you define a "bottom", but ok.
Immigrants and Chris Luxon together could lead the property market to new heights.
Unlike a growing number of contributors here, however, I don’t see the housing market booming in 2024.
TTP
What time is it in France TTP
Te Kooti
Depends what you think is important to this Country and its people.
If the best National can do is a restart of the Ponzi we are in trouble.
Just a cynical con job trying to be called a tax break.
That's not leadership.
Foreign owners selling before prices continue dropping and with the sheer number of residence visas given for those who got stuck in NZ over lockdowns 2020-2021 and with more residencies being given for skilled workers coming to NZ it makes logical sense that this would be the trend. Many migrants looking to start a family and/or bring the family over given the opportunity they have been given via the residency they may not have even intended to get when they got locked down here.
Winton will be happy.
Wow and everyone here still thinks all the migrants are as broke AF !
they will be after they buy million dollar shed
Zwifter bang on I can remeber getting lambasted by people on here when I said with the 200k plus new NZers joining the buying of property here. All the small minded inward looking people said no way. Alot of these people are on low wages and couldn't afford etc etc. Yet I replied they save and they work (that 4 letter swear word) they do more than 40 hours a week and they show up week after week they want over time and they don't waste their money on things they don't need.
Migrants are getting on with their lives rather than spending all of their time complaining on a website under a pseudonym having arguments with people they don’t know about whether they fit a binary DGM/spruiker label.
Bravo
NZ: For Sale.
Again
Buy now folk, it'll never be cheaper....
Almost too late, told everyone to buy the dip. August until October was your window of opportunity.
Be quick!
Its not to late with interest rates 8%
Lower for longer the banking cartel control it.
Easy to jump to negative conclusions from this headline but residency visa holders are very different from the sort of speculative overseas investors that we are about to let back in. The typical residence visa homebuyer is a productive tax-paying worker and quite likely a FHB. It's good news that these guys are buying more properties and growing their roots in NZ, rather than Joe Boomer with five investment properties buying more.
Really quite disappointed with the Boomer mentality on here. Its a free country mate, you too can go out and buy as many houses as you like as well.
Yes a lot of jealously here aye?
Lots of boomers seem to only care about the next 5 to 15 years, max. Especially those who do not have functional family structures with kids they care about. So, for example, "Will climate change become a total disaster in the next 20 to 50 years? Won't be my problem, LOL..!" And even worse, many seem to only care about themselves and how many (horribly boring-sounding) cruises, holidays, coffee shop lattes, etc. they'll be able to fit into the next year or ten.
The mentality I describe is therefore a bit like a terminally ill guy who doesn't care if the world goes kaboom in a nuclear accident next year, therefore doesn't want governments to spend money making sure this scenario won't happen. The guy won't be popular with the rest of society, no surprises there.
how many (horribly boring-sounding) cruises, holidays, coffee shop lattes, etc. they'll be able to fit into the next year or ten.
This brings the question of what you would do with your own retirement with the possibility of lower mobility, potential illness to live with, and money to spend, maybe you lost your spouse too soon. Can't fully bag on them for spending when in some ways this is keeping the hospo sector afloat to a degree as everyone else buckles down. Recently in Southeast asia I saw swathes of them visiting key historical sites, moving slowly with walking sticks etc as they will have saved their whole lives to travel only to find that it isn't as easy with lower mobility. There is a tradeoff there.
I don't begrudge any hard-working, valuable member of society a wonderful life in their twilight years. But if Boomers are obtaining this 'wonderful retirement' by being little more than parasites sucking the blood out of society and younger generations, I'm less than happy about the situation.
Shouldn't you be doing your meal prepping Tui?
Meal prep happens on Sundays. But I might be completely misunderstanding your comment here.
P.S. I'm still wondering what you meant here, but I probably missed something. *shrug* Anyway, I work from Monday to Saturday. On Sundays, my partner and I do meal prep and plan lunchboxes for the kids (as well as do some volunteering every month, do shopping, play family games, etc).
Well of course you are missing the flipside, by not having kids they are actually saving the planet. Absolutely it will not be my problem and when I die I will not be worrying about my kids future. Yep will no doubt be spending up big and as they say no point leaving a good looking corpse.
To reword your comment: If short-sighted policies that benefit ME will lead to rampant crime, increasing homelessness, misery for younger generations, a downward spiral for healthcare, and a breakdown of the very fabric of society in the longer term, I can't give a %@#$.
As I say, don't expect to be popular with this view. And boomers who are more switched on will probably dislike you too.
"Lots of boomers seem to only care about the next 5 to 15 years, max"
Politicians seemed to be concerned about winning their popularity contest each election cycle. This incentivises short term planning rather than long term planning for the improvement of the country as a whole.
If politicians do what is good for the country as a whole for the longer term, it may mean short term pain for the general public and then the politician loses their popularity contest in the next cycle.
Yep. And pure democracy cares only about what the majority wants. For example, if the majority wants to get rid of a certain minority, then democracy cheers for a genocide.
So politics and democracy are a dicey combination.
(On a slightly different, but related note, the Boomer generation has benefitted hugely throughout their lives from their huge numbers.)
Edit: I should add, sadly, democracy is probably the best option mankind has been able to come up with. Sad, but true.
Hey ChatGPT, write me a headline that will incite rage.
Not hard to around here, let's be honest...
The migrants have firmly secured their spots, suppose many of them didn’t need a mortgage.
Easy way to get your money out of a country with a totalitarian government.
This is for all those Labour voters who hadnt figured out that a Foreign Buyers ban is meaningless when you give everyone permanent residency.
A bit of a dim comment. Not everyone is getting permanent residency.
To gain residency migrants have to be rich/working in a well paid job and be of good health & "character" (no convictions).
I know one that recently got residency. She was Woofing and only has a singing bowl certification. She was from the caught in covid cohort.
No they don't, they literally only have to be here for 4 years. Come in on a temporary visa, which gets converted to a residency visa after 2 years, which converts to permanent residency after another 2 years. The immigration department is rubber stamping all visa applications - there is no longer any requirement to prove job skills or even that they have a job. They all end up with PR.
Nightstalker, you are right, in theory. However, have you seen what's been happening in practice?!
Immigration officers say they’ve been told to ignore criminal convictions and investigations, not to read supporting documents on visa applications, and not to check work visas at the border in a “light touch” drive to grant more visas faster.
Imagine what a 'hard touch' drive would look like. NZ is making a grave mistake here. This news will spread like lightning and the number of fraudsters and criminals gaining residence in visas is probably increasing as we speak/type.
Oh, and the health check was waived for many of the Covid cohort resident visas as there wasn't enough time and doctors to do the required medical checks.
It would be great to see a breakdown by regions.
Most migrants would either buy in Auckland or Wellington and I'd imagine their market share would easily be 25% or more.
"Most migrants would either buy in Auckland or Wellington and I'd imagine their market share would easily be 25% or more"
In the September 2023 quarter:
1) there were an estimated 2,256 transactions where purchases were made by migrants
2) in Wellington and Auckland combined, there were 6,818 transactions according to REINZ.
Assuming that all the migrant purchases were made in Auckland or Wellington, then that would be 33% of total transactions in those two locations.
Hey David ... What is the proportion of people living in NZ with resident visas?
Great data David. So migrants are buying houses here, in ever increasing numbers. Good to have confirmation by data rather than "I reckon"
Based on these figures 5% of immigrants are buying houses.
These migrant buyers obviously don't read the interest.co.nz comments from the DGMs and see now is the worst time to buy a house in history and only a complete fool would ever even consider it. Meanwhile Kiwi families keep getting left behind...
Actually it is always a good time to buy. If you expect to see a massive crash then sorry that is way too optimistic and optimism bias will blind anyone to the reality that rental homes with rents above the amount of weekly costs actually are still good investments even if the house is taken out by a volcano the next day. High rental income that has favourable tax laws & insurance actually mean that buyers are often insulated from things that might cause the worst drops in value. Especially with a large increase in adult population even if you try fitting more than 10 people into a 3 bedroom home.
Nevertheless we never did get that crash which would make houses as affordable compared to income as they were 10 years ago. All we did was start adding more individuals to the income calculator to try to give a better appearance of affordability. So now instead of 1 person being able to afford a home we now have a metric that uses at least 2 people's income and they will be considered to have likely guarantor support of other home owners with additional income.
In a years time that metric might increase again and a household would be made up of multiple adults who are not in the same immediate couple (e.g. inc friends, flatmates, brothers & sisters, parents, other families who will share the house etc) so we can make our affordability calculators not such complete trash now home ownership is pushed even further away from any person to live in during retirement. Sadly the truth is while people want homes to be more affordable that metric will only go one way, especially since we now accept it is near impossible for most single incomes to afford housing in our main city centers.
Here's what Assistant Minister Andrew Leigh in Aussie says. The narrative might sound familiar.
So, one of the reasons that we've struggled to build enough houses is when you talk to builders, they say they can't get enough skilled workers. So, some of those migrants coming in to build houses, not just to live in them.
Q: But we've got that terrible problem, right? We've got not enough people to build houses, but we've also got so many people coming, we don't have enough houses. How do you explain that dilemma? Or how do you fix that?
LEIGH: Well, we're fixing it through the Housing Australia Future Fund, which has passed the Parliament despite the opposition of the Liberals, but with the support of Greens and Crossbenchers. That's a welcome investment in Australian homes. 30,000 social and affordable homes.
Q: Pretty long-term, though, isn't it?
LEIGH: Building houses doesn't happen overnight, Raf, but you've got to get going on this job. And I thought it was pretty remarkable that the Liberals, despite acknowledging that housing supply was an issue voted against the biggest housing supply measure in decades.
Q: But that's not going to fix the rent problem, is it? To be honest, people, if they hear the rent inflation figure around five, six, 7 per cent, they'd be thinking they're really lucky if their rent is only going up that much. What do you say to someone whose rent is going to keep on going up significantly every year for the next few years?
LEIGH: Well, in our last budget, we put in place the largest increase in Commonwealth Rent Assistance in 30 years. That had a tangible impact on rent inflation. In the inflation figures that came out yesterday, the Australian Bureau of Statistics reported that rents would have increased 2.5 per cent without that measure. In fact, they increased 2.2 per cent. And we'll see the full impact of that higher Commonwealth Rent Assistance flow through in the next quarter. You can see, too, in the inflation figures, our energy rebates and our childcare subsidies playing a tangible part and putting downward pressure on prices in the face of a global inflation challenge.
"Rent assistance" - assuming thats a subsidy
As we all know & proved over decades of accomodation supplements & the recent Covid house price escalation: rents are set by peoples ability to pay, not the house prices or landlords costs. Any subsidy increases the price (demand/supply equilibrium point raised - econ 101).
Simply political virtue signalling to avoid doing anything meaningful but harder, no different across ANZ.
Simply political virtue signalling to avoid doing anything meaningful but harder, no different across ANZ.
Precisely. It was interesting to see that the Aussie leadership is equally as useless in terms of solutions.
"By the September quarter of this year that share had increased to 14.3%."
How many is this in absolute numbers?
According to REINZ figures, for the Sept 2023 quarter, there were a total of 15,851 transactions
https://www.interest.co.nz/charts/real-estate/volumes-sold-reinz
14.3% of this number is 2,267 transactions for the Sept 2023 quarter (averaging about 756 per month).
Or 25 houses bought every day by immigrants, out of 176 sold every day.
Problem is mate that they are a tiny minority so in total based on percentages they are probably buying up half the houses.
195,000 immigrants to June 2023 buying 756 houses a month = 5% of immigrants buying house.
"In the September quarter of 2019 residence visa holders accounted for 8.2% of all residential dwelling purchases, excluding vacant land. By the September quarter of this year that share had increased to 14.3%."
Edit: note also this comment above
by nightstalker | 27th Oct 23, 2:24pm
It would be great to see a breakdown by regions.
Most migrants would either buy in Auckland or Wellington and I'd imagine their market share would easily be 25% or more.
"However the data for sales by or to residence visa holders and overseas owners may be significantly understated, because it excludes sales or purchases made through a company, regardless of where the company owners were based or their residence status, or those sales made by or to a trust where at least one trustee is a NZ citizen or resident, even if the beneficiaries are based overseas.
It is not known how many residential properties are bought and sold in NZ by companies or trusts where the beneficiaries are NZ residence visa holders or overseas owners."
Also, residents can apply for citizenship after 5 years. It is not known how many residential properties are being bought by citizens who immigrated fairly recently (as little as 5-6 years ago).
"195,000 immigrants to June 2023"
Points to note:
1) this is a gross number. It does not account for people leaving NZ.
New Zealand had a record net migration gain of 96,200 in the July 2023 year, according to provisional estimates released by Stats NZ today.
https://www.stats.govt.nz/news/record-net-migration-gain/#:~:text=New%2….
2) the net 96,200 immigrants does not mean 96,200 residential dwellings. Some of the household sizes could be anywhere between 2-5. Assuming a household size of 3 then that is potentially 32,066 residential dwellings.
3) accommodation does not have to be purchased. It can also be rented. These immigrants may also choose to stay with other family members already living in NZ, and hence their household size would be larger than 3.
This just gives us the ratio of buyers that are migrants but aren't house sales pretty low still?
What is the percentage and absolute number of migrants that are buying? Given the huge numbers numbers coming in, how many of the migrants are actually buying? Isn't this a more relevant metric for working out what migrant demand might be?
Sorry just read through all the comments and realised that someone has already answered.
102k - 2021 Resident Visa applications have been issue since end of 2021.
Mostly people already in the country during covid and or had already been in the country for many years.
4k application left to process for that specific visa.
This lines up with a increase as people became eligible to purchase property.
For the other residence Visa's , applications at hand are back to before covid levels. So expect the levels of migrants purchasing houses to slowly decrease
That was just the number of visa applications, and applications can cover more than one person. The actual number of people getting permanent residency under the Covid visa is 217,626.
Considering most can easily buy houses through companies and trusts (which is a well known common practice for rental ownership in major cities) those who are buying without them are just those too poor to set up with false NZ representative, or fake address. There are literally businesses operating in NZ with the sole intention as providing a forwarding NZ addresses for other companies setup; it does not need to be a real one as there are very few checks that the company owners/beneficiaries actually reside at the address or operate out of the office. The same goes for trusts. Hence the % above is just those so poor they cannot even afford a dirt cheap legal representative for less than a couple of hours every quarter to do the document setup & accounting. The fact that the number and % of companies and trusts buying residential homes is often left out is generally because if the general public knew that it is such a common practice for a significant number they might petition the government to close the loophole... which would impact large donating investors.
Sounds like people are getting jobs, putting down roots, raising their kids, and getting on with it. What a concept.
Visa holders buying on behalf of non visa holders who have the cash. Just speculation on my part, but probably some truth to it.
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