If you are wondering why your property has slipped in value or is slow to sell, could the ban on foreign buyers be a factor? Let’s dive into the stats…
Data for the June 2019 quarter released today by Statistics NZ shows the transfer of 939 homes in Auckland’s inner-city, including 75 (8% of total transfers) to foreigners (buyers who are not NZ citizens or resident-visa holders).
Transfers to foreigners were down a massive 77% compared with the peak last year of 321, when people with Chinese tax residency accounted for 10% of all home transfers in central Auckland, and all foreigners combined accounted for 22%.
The peak in the June 2018 quarter was shortly before the Overseas Investment Amendment Act 2018 was passed, restricting the sale of residential land.
In the latest quarter just 5% of all home transfers in central Auckland were to people with Chinese tax residency, and just 8% to all foreigners combined.
“It’s not surprising to still see some home transfers to overseas people in central Auckland, which is dominated by apartment buildings,” said Statistics NZ property statistics manager Melissa McKenzie.
She pointed out that buyers may have bought apartments off the plans before restrictions on overseas home buyers took effect. “These only show up in our statistics once the apartment is built,” said McKenzie.
A ban on foreign buyers took effect from 22 October 2018 and prevents most people who don’t hold NZ citizenship or a resident visa from buying residential property in New Zealand. But McKenzie says the number of homes sold to foreigners may never be zero, despite the ban.
“The Overseas Investment Act also allows Australians and Singaporeans to purchase residential property in New Zealand, and other overseas people to purchase in some new developments.”
Across New Zealand, there were 183 home transfers to foreigners in the June 2019 quarter compared with 1,116 in the same quarter last year.
Total home transfers numbered 37,695 and of those 0.5% went to overseas buyers. A year earlier, total home transfers numbered 39,627 and 2.8% went to overseas buyers.