New Zealand officials say they are banning foreigners from buying existing homes in the country in response to growing affordability problems in its residential housing sector.
“Our goal and commitment is to ban foreign buyers from the existing housing market,” Prime Minister–elect Jacinda Ardern told local media this week. The ban only applies to nonresidents.
New Zealand officials are blaming its “affordability crisis” on low interest rates, limited housing stock, and high net immigration that is driving up prices, CNBC reports.
U.S. investors were among those who had been purchasing New Zealand property, but their interest has been exceeded in recent months by an influx of Chinese buyers.
New Zealand is “no longer for sale,” Winston Peters, the leader of junior coalition party NZ First, said about the decision to ban foreigners from buying homes. “The reality is there is going to be a change and a clear signal sent internationally that New Zealand is no longer for sale in the way it has been. We’re happy with that.”
ANZ Bank estimates that New Zealand is 60,000 housing units short to cover its population’s needs. Plus, its housing shortage is increasing by 40 houses a day.
The country’s largest city—Auckland—has seen its median home price nearly double since 2008. The median price is $582,000 in U.S. dollars in September ($845,000 in New Zealand dollars).
Source: “New Zealand Is Banning Foreigners From Buying Property,” CNBC (Oct. 25, 2017)
