Data on non-resident purchases shows 3% of property buyers non-residents for tax purposes, but no way of knowing how many of the other 97% are foreign students or temporary workers; new survey detail due in May

Data on non-resident purchases shows 3% of property buyers non-residents for tax purposes, but no way of knowing how many of the other 97% are foreign students or temporary workers; new survey detail due in May
A hoarding advertising a new apartment block in Eden Terrace in Auckland on July 8, 2016. Photo by Bernard Hickey for Hive News.

By Bernard Hickey

The percentage of property buyers who said they were non-residents for tax purposes was unchanged at 3% in the September quarter, but Land Information New Zealand (LINZ) said it still could not say what proportion of the other 97% were not permanent residents because they held a temporary work or student visas.

LINZ said it was continuing to re-design the survey questions designed to find out whether buyers were citizens and permanent residents, or whether they held temporary work or student visas. LINZ has a survey question which currently allows both permanent residents and non-permanent residents to identify themselves as students or having temporary visas, meaning the results cannot be used.

LINZ said it expect to confirm the redesigned survey question in December after consulting with lawyers and conveyancers and changing its IT systems. It would conduct the redesigned survey after the March quarter, which meant the first results to break out the portion of buyers who were students or temporary workers would be released in May next year.

The September quarter survey found 3% or 1,431 of the 53,991 property transfers registered in the September were to buyers who identified themselves as being foreign tax residents, including 471 from China, 336 from Australia and 69 from Britain. The percentage of buyers of Auckland properties who were not New Zealand tax residents was also unchanged at 4%.

LINZ did not release the proportion of respondents who said they were on student or work visas.

"While we have also asked buyers with work or student visas whether they intend to live on the land they have purchased, analysis has shown that the results for this question are not accurate,"  LINZ said.

'It proves there's no problem'

Land Information Minister Louise Upston said the data disproved Opposition claims of substantial foreign buying of properties.

“This latest report, although based solely on tax data, does not support the opposition rhetoric of mass purchases by foreigners. The data for both buyers and sellers showed overseas tax residents involved in just three percent of both types of transfer,” Upston said.

“I would stress again that this data is not a register of foreign ownership but is collected as a result of government property tax measures in legislative requirements, to help Inland Revenue follow up on those people who have tax obligations," she said.

'It proves no such thing'

Labour Housing Spokesman Phil Twyford said the figures were "dodgy" and the Government should stop "fiddling with the statitistics and give an honest account of the number of New Zealand homes being bought by foreign speculators."

“National’s figures exclude large number of foreign buyers to try to mislead Kiwis into thinking overseas speculation is a smaller problem than it really is. It’s time they faced the facts and banned the foreign speculators who are using Kiwi homes like gambling chips," Twyford said.

“Last time, National’s cooked-up foreign buyer numbers were laughed off the stage because they excluded foreign investors in New Zealand on temporary work and study visas," he said.

“Now, to hide their embarrassment, they are saying the number of foreign buyers on temporary visas shouldn’t be used and have omitted it from the main data. National should stop mucking around with the stats. The public want full and transparent figures showing the number of non-resident non-citizens who are buying houses here."

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

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64 Comments

29
up

Wow need one year to rectify simple error.

What do we call it.

30
up

Will call it Manipulation and with damage already done government will now be hoping that by next year foreign buyer number would have reduced as they would have moved on and the number will be face saver for nats.

27
up

This is cheat with people of NZ.

Act or not to act is government prerogative and we can agree or disagree but WHY suppress and manipulate if nothing to hide. Shame.

This manipulation and lie gives rise to brexit and trump as people in power forget that now with social media exchange of idea and view leads to exposure and anger.

16
up

The Kiwi 'can-do' attitude being replaced with a 'can't-do' or 'won't-do' approach. Sad.

27
up

NOT GOOD ENOUGH, GET IT DONE NOW OR GET A NEW BOSS WHO CAN

15
up

Land Information.....or is that Lacking Information....NZ.

Remind me....what do we actually pay these people for...or are we Doomed, not to ever know. It does not compute. Is this why we pay our legitimate taxes?.

Some surveys still legible on paper...from centuries ago.. Plus they had been invaded by Hordes....far bigger.

https://en.wikipedia.org/wiki/Domesday_Book

Domesday Book (/ˈduːmzdeɪ/ or US /ˈdoʊmzdeɪ/;[1][2] Latin: Liber de Wintonia "Book of Winchester") is a manuscript record of the "Great Survey" of much of England and parts of Wales completed in 1086 by order of King William the Conqueror.

The survey's main purpose was to determine what taxes had been owed during the reign of King Edward the Confessor. (This interpretation is challenged by some historians, who see it as an attempt to assess where power lay after a wholesale redistribution of land following the conquest.)

But that is neither...here...nor there.

Now to be called NLINZ - Not Land Information New Zealand

27
up

This is beyond a joke.

18
up

What's so hard?
There are approximately 9,000 property sales transactions NZ wide per month
Any data entry clerk could input 9000 data items into an SQL database in 2 days max
More likely it could be done in 1 day

Smoke and mirrors
Have just read the article again. It "says" there were 54,000 "transfers" in 3 months
On an annualised basis that's 216,000 "transfers"
There aren't 200,000 sales in any given year. At best 100,000
Suspect the numbers are being inflated by off-market related party transfers

I don't believe for a minute there are that many off-market transfers

Bernard - Question

What were the number of transfers for the previous 2 quarters?

It appears transfers are increasing while sales are decreasing

What's going on

I suspect it's Vancouver market shock which has caused a lot of the overseas banks to close their doors to overseas investment in to residential property. There's quite a few court battles going on over there at the moment between Canada's BC and China. Also Vancouver has just brought in the empty homes tax as well in the last few days. Not surprising the the Overseas Investor market has got cold feet.

http://vancouversun.com/opinion/opinion-sensible-property-tax-reform-for...

11
up

If we assume that foreigners tax residents and foreign students and temporary visa workers intend to hold onto these houses more than local speculators would, then its not just 3% (plus the additional X% which LINZ choose not to account for). It is:
year one (3 +X)%
year two (3 + X)%
year three (3 + X)% ad finitum
Houses taken out of NZ ownership.

15
up

Makes Monty Python look like a documentary.

27
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To be honest this is one form of corruption and is annoying as no one like to be manipulated and that too so blatantly.

Is possible as no oposistion and inactive media.

I concur.
Where is the opposition? Mr. Twyford why so silent?? Mr. Little, here is a massive opportunity to nail this inept management and manipulation of critical data that clearly the man in the street knows is happening!
You are taking us for fools Mr.Key! What else is there to say.

Fake News
The mandarins in Wellington are now manufacturing fake news
They do that knowing the press-gallery scribes like Bernard Hickey cannot fact-check it

And they know the peasants will forget about May 2017 in the next 2 days

Only anecdotal but I was on a Wgtn - Auckland flight yesterday and there was a 20 Something Chinese guy sitting next to me with a property press circling properties. Can't say if he was on a student visa or not

So true!
I was walking past the real estate agency yesterday and there was some white lady, possibly eastern european, looking at properties in the window. Government take notice!

Not sure if anecdotal but I saw a white female looking at trademe properties in herne Bay on the Internet last night, and then she said she was going to bed, what a scandal...

18
up

Entering a new phase with Kiwis effectively banned from buying houses by the RBNZ. The Chinese continue their relentless purchasing of Auckland homes. A lot of peoples lives have already been ruined as evidenced by the collapsing home ownership rates for 30-40 year olds. The wealth transfer suffered by gen-rent will probably become entrenched as time moves on. Nothing has changed wrt foreign purchasing so I suspect home ownership rates in Auckland will continue to plummet. Anger and resentment will continue to grow.

11
up

If we could land man on the moon over 40 years ago, they can surely work something as simple a this out. It is hardly rocket science. I guess it is lucky for them that there has been an earthquake so the information gets lost in the news.

NZ needs to look hard at what happened in the USA and UK. If people ages 20-45 can't afford to buy a house in a city, they are going to be voting for major change, and it just creates big division between the rich and poor.That gaps has only grown in the last 10 years partly as a result of house prices rising so much. Cheap credit has just amplified the house price growth.

Young people voted remain and hillary

16
up

It surely is a very poor reflection on the LINZ staff (and their management) involved in this farce of what is now a multi-year data collection.

"LINZ said it expect to confirm the redesigned survey question in December after consulting with lawyers and conveyancers and changing its IT systems." and then finally having some meaningful data by May 2017.

Unbelievably poor performance.

18
up

By May 2017, The boom in property price growth will be over. The foreign buyers (students) will stop buying and the reworked LINZ survey will say, nothing to see here.
Meanwhile young working class NZers have become doomed to be tenants for far longer or for their whole lives.
Our new landlords come from countries that are very competitive, they are in their financial position because they have been successful within this competitive environment. NZers easy going nature and lifestyle is a doddle for them to manipulate. They even drop off their old people for us to look after. We are muppets.

Do you blame your new "landlords" or blame yourselves?

I blame the government for allowing this to happen.
I blame our news media for not educating our people.
I also blame our media for demonizing our only outspoken politician who has raised concerns on our immigration and foreign investor policies for 20 plus years.
So yeah, mostly I blame our media.
Our media is currently backslapping John Key for a job well done on earthquakes. The unwashed masses see this and think great guy, job well done, meanwhile the sovereignty of property and business ownership has been sold off to foreign interests.
We were once a colonized land, we are now a rentalized land.

You should also blame the voting population for voting for governments who made no secret about their trade agreements an (neo) liberal agenda.
.
I include Labour in this basket, too, by the way.

Too true DFTBA. But that is my point. The NZ working class voter gets its political education watching the 6 oclock news. The news says all is well and that John Key is a great guy, he gets voted in.
The news says Winston is bagging Chinese again and Winston gets mocked, Even when he makes no definition the media add bits in.
NZ is let down by the standard and biases of our mainstream media.
As for trade deals, who knows whats in them? its only years later that we find out that our free trade deal with China has opened the door to a flood of money buying up houses, land, businesses, core infrastructure and resources.
The TPPA trade deal is mostly secret, who knows what side affects and unforeseen outcomes will be in there.

The obstacle is the Trade Deal with South Korea

I would have expected at least one courageous legal academic to advise what the consequences would be if we tore up that trade agreement with South Korea

Because it has become the foundation corner-stone of the FTA with China

Not true new Zealand has some of the highest home ownership rates in the world...

Nothing to do with LINZ they are the scapegoat for the government telling them to go slow....

Joe Public are not idiots... we can see through this....

[ fragment deleted. intended as a personal insult. Ed]

20
up

The house next to me was auctioned last night in Albany. It went for $1.33mil (homes.co.nz $1.3mil). There were ONLY CHINESE bidders, about 12 of them. The house on the other side of me is already owned by Chinese, so are the 2 opposite the street. All rented out. Just anecdotal evidence of course, as I cannot prove more than 3% is buying up our houses.

12
up

Around 65% of all sales in Albany are to Chinese buyers!

15
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Well reader should not be using the word chines (though truth) or will be termed as as racist - Weapon that government uses to curb the truth - Do they not say that truth is bitter.

Also if you talk about Brexit or trumpism many politicians and so called experts take offense.

My question to all is if not afraid or shying away from doing things that people of the country wants than why be afraid or offended when people express their anger in election and go for brexit and trump.

[personal insult removed. You know the standards]

23
up

In Aussie foreign purchases are estimated at 29%'.

Here it's apparently 3%.

Pffft.

11
up

[ personal insult removed. Other people can have an opinion too. Just because you disagree does not give you the [anonymous] right to smear them. Just stick to the issue. Ed ]

14
up

This is absolutely pathetic.
Essentially, nothing short of corruption.
And, we all let it happen.

No Strong opposition and also strong media to lead it to its logical conclusion that is highlighting/exposing government by asking tough question though Bernard has raised it as is aware but can it be raised to the government may be like an open letter - which our PM was quick enough to protect the so called investors.

17
up

And they wonder why Trump won. The working middle class are not stupid. They can see right through this and know the real figure is much more than 3% when students and temp work visa's are taken into account.
I believe NZ is ripe for a party that understand the anger of the working class and how they've been left behind particularly in the provincial towns. Winston winning Northland should have been a wake up call.

12
up

LINZ are absolutely useless. Surely it cannot take this long to rectify a few survey questions.

15
up

How hard is it to ask the question:

"Are you a NZ Citizen? Yes/No"

16
up

"dodgy" says it all. Everything about this government is dodgy.

21
up

There can be no doubt now that this is no "oversight"

It is nothing short of a cynical, planned attempt to hide what has been going on in NZ.

I'm horrified I voted for this mob more than once - I'll accept idiots and incompetence in Govt as "par for the course" but something this Machiavellian and corrupt against my fellow countrymen sickens me to my core.

I'm 50 now and it will take a miracle for me to ever vote National again.

I've never been as disappointed in any politician as I am with John Key - I really thought he'd be different but alas....what we got was another politician - where anything is acceptable for retaining "power"

More damage has been done to the social fabric in this country under his watch than I dare think about.

And I'm one of the lucky one's....

[This comment is close to the line. It is barely on the issue, mostly aimed at someone personally. It is the type of smear we are trying to rid from these comments. You can criticise policy positions all you like. Remember though that others may have a different point of view. Just because it is not yours does not justify extreme response. The contest of ideas is what we are looking for, not a contest of shouters. No one should demand a 'right' to be right. Stay on the issue. Ed ]

Ed - seriously....Wow...lost for words.

So now a personal view of disappointment and an opinion cannot be aired as it's "Extreme" - sorry but that's laughable.

I'm so centerist its boring....time to move on I guess.

What you have said is how many feel, but i guess adds little to a business debate site. I too have had enough of half truths and hidden agenda's. Brexit, trump.. at least we have the Prosperity Party of Garther Morgan to vent with. First party i have ever joined.

19 people agreed with him. Does this mean 19 people have extreme views?
Doesn't seem to be anything "extreme" about that comment ..you say we are not in the US ... we are also not in China Ed.

http://www.bbc.co.uk/news/world-asia-38005603

11
up

Agree totally cynical masking of the truth. Shameful. Election year next year. This issue regardless of background has the potential to unify all kiwis against the government except the ponzi members who's just want the prices to keep going up regardless of the damage to the social fabric of NZ. Vote for a change. From a certain party website (not National).

-Ensure that New Zealand’s housing stock is restricted to New Zealanders.
-Non-residents who are not New Zealand citizens would be ineligible for home ownership except if a genuine need to do so can be demonstrated.
-The terms and conditions upon which existing approvals by the Overseas Investment Commission for the ownership of land by non-residents would be fully monitored and enforced.

When people comment and is not to government liking, the government and also many a times media too feel it is just a bunch of good for nothing who are commenting but remember like a survey it represents the sentiment of the people.

Should be a wake up call to the government or what happened in UK and USA would not have happened - never underestimate the power of the common men.

Election Next year.

16
up

I just cannot understand how they can get away with this. We are in the middle of a housing crisis, yes a crisis.
We need all the information possible available to the public and politicians so effective policy can be rapidly implemented to solve this serious problem. What has happened is a complete manipulation of the data available to suit their ideology and now it will take another 6 months to get a (hopefully) more accurate report? This is inexcusable, where are our media?

Sure seems to be taking a while....

23 June 2015
“Prime Minister John Key says measures to tighten property tax laws will collect "perfect information" on non-resident buyers.”
http://www.stuff.co.nz/business/69630188/law-to-gather-foreign-house-buy...

13
up

you guys seem surprised about this? Working in corporate office for 5 years it's exactly the same tactics my boss uses when I ask for a pay rise: Obfuscation, incomplete data on performance, delay, promises of more complete data, some more delay, the need for a more thorough investigation, a bit of delay, promises, next year, I meant next financial year, delays....
That's what you get when you run a country like a business.

Correct. [Fragment removed. No baseless insults. This is not the US. Ed]

First thing first.

its only a survey,no penalty for lying.why identify yourself as a foreigner.no different from dept of statistics accommodation surveys.do you think motel owners go through their visitor book every month and add up what percentage of each nationality they had,or the 4square owner lists what percentage of his trade was cash?they just feed the system as there is no check on it.

I know personally of one that did exactly that, mainly for targeting of advertising, but he did do it, can't imagine he was the only one

the survey was used as market research courtesy of the taxpayer to target advertising by the hotel chains,if smaller motels were getting lots of business from japan or whatever they then would spend more in that market to take that share,small motel owners have minimum budgets for advertising,seen more as a parasitic burden!

10
up

Cheers Bernard good to have a reporter questioning the number of foreign students and temp visa workers.

Appreciate it. hopefully they too will be labeled foreign buyers like in aus.

http://www.bloomberg.com/news/articles/2016-11-09/vancouver-wields-c-10-...

More Vancouver news
Want to keep your million-dollar luxury pad in Vancouver empty? Get ready to pay C$10,000 ($7,450) annually in extra taxes. Lie about it? That’ll be C$10,000 a day in fines.
Canada’s most-expensive property market, suffering from a near-zero supply of rental homes, announced the details of a new tax aimed at prodding absentee landlords into making their properties available for lease. The empty-home tax will take effect by Jan. 1 and will be calculated at 1 percent of the property’s assessed value, Vancouver Mayor Gregor Robertson told reporters at City Hall.

I was recently in Canada and had a conversation with a nanny working in one of the most expensive streets in Vancouver. She told me of many empty houses in that street where she used to watch people come and place children's toys, swings etc in the gardens and then come along a few days later and move them to different parts of the sections so that authorities thought the houses they
were inhabited. Unbelievable.

The establishment (national) have stepped in to stop LINZ reporting By the looks of things:

LINZ did not release the proportion of respondents who said they were on student or work visas.

How many NZ citizen students are buying properties. Can't be that many surely... most banks won't loan to students

You're assuming they need loans from NZ banks....

Let's remind ourselves of Australia definition of foreign buyer
Definitions:
NZ foreign buyer = non resident
Australia foreign buyer = non resident + foreign student + temp visa worker

http://www.sro.vic.gov.au/foreignpurchaser
Foreign purchasers
You will be a foreign purchaser if you are a foreign natural person, a foreign corporation or a trustee of a foreign trust.

Foreign natural persons
You are a foreign purchaser if you are not:

A citizen or permanent resident of Australia,
Or a New Zealand citizen with a Special Category Visa (Subclass 444)

13
up

National are a disgrace.... I feel sorry for the LINZ ceo as they are made to look like muppets by National

No organisation needs 2/3 years to fix a survey lol.... maybe we should send them to vancouver they seem to implement things quickly and efficiently

[ Sorry, you know the standards. Extreme insults are not needed in NZ policy discussions. Stick to facts. Fragment removed. Ed] ... Bring on the elections

.
It is fairly clear (with all the Ed comments you have had to make today) that people are extremely angry with all these delay tactics and cover ups by the government to hide what is really going on.

Also the delays in bringing in DTI restrictions

Delays in working out if a vancouver tax can be applied given FTA

People have had enough.

13
up

They are hiding the data and hoping like hell that the buying cools before election as the true percentage will be their undoing.

There will be another error with the survey (my guess)
So the actual results will not be available until after the election.

Would be good to interview the LINZ boss now to see what the amended survey looks like so we can check it is correct. Not the data just simply the questions that will be asked.
P
Ed can you follow up please ... would make a great article

This is quite interesting

http://money.cnn.com/2016/11/17/technology/trump-tech-populism-automation/