Government to allow foreign home ownership for investors

Monday, 1 September 2025

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Those in the luxury real estate market say their phones are already ringing as the Coalition Government has agreed to allow foreigners with investor visas the ability to buy a house in New Zealand, despite a ban on foreign home ownership.

While the ban will largely remain remain, to attract additional international investment holders of the “active investor plus” visa would be able to buy homes valued over $5 million.

The Government earlier this year created a new golden visa, called the “active investor visa”, which requires a more than $5 million investment in the country. Such visa holders, not required to be present in New Zealand for six months of the year, were unable to purchase houses due to the ban.

The minimum value of the house will be $5 million, which is less than 1% of New Zealand houses.

“This change navigates a path between those who do not want foreign ownership opened up … driving speculative property investment, and the desire to attract high-net worth investors by deepening their connection to our country in order to help grow our economy,” prime minister Christopher Luxon said on Monday.

Luxon said there were 10,000 homes above $5m in New Zealand, and 300 foreigners had applied for the active investor visa, which could bring in about $1.8 billion in investment.

Luxon said he and NZ First leader Winston Peters started at “different positions” on the issue - National had campaigned to lift the ban - but were “very aligned” on this change.

“Winston has been very constructive and positive about the need to attract investment to New Zealand, but again, both of us don't want to see what we've seen in the past, which is lots of speculation in our property markets, and lots of frothiness and flipping of houses and selling houses to each other.”

Peters, in an interview with The Post earlier on Monday, said his party were “just the ones that said, ‘This is the restriction, and we're prepared to look at this area alone, because it's not a foreign buyers ban matter, it's a matter of international investment in New Zealand’.”

Easing a ban on foreign home ownership has been a point of contention within the National-led Coalition Government.

The ban was set in place in 2018 by the Labour-led coalition government, when Peters was deputy prime minister, due to concern foreign buyers were driving up prices during a housing crisis.

National had in 2023 campaigned on allowing foreigners to buy homes valued over $2 million, with a tax of 15% on the transactions projected to earn the Government $2.9 billion in four years -- helping to pay for tax cuts.

But NZ First drew a line through this in coalition negotiations.

Luxon has been signalling a change was coming, and Peters publicly indicated his position was shifting.

Peters said there would be no effect on housing market competition.

“They won’t be able to buy houses, they will be able to buy one house, or build one new house.”

Deputy Prime Minister David Seymour, the ACT Party leader, said allowing investors to buy homes that does not affect first home buyers was a “massive win-win”.

But Labour said home ownership would now be even harder for Kiwis.

“Many Kiwis are already struggling to buy a home, and he has just made it worse,” said Kieran McAnulty, Labour Party housing spokesperson.

“More pressure at the top end pulls up house prices for the average Kiwi. New Zealanders should be at the top of the priority list for houses.”

Labour leader Chris Hipkins said lifting the ban would inevitability increase house prices, as buyers would be pushed out and forced to buy in the next price bracket down.

“Christopher Luxon is rolling out the red carpet for wealthy foreigners wanting to buy New Zealand homes while Kiwis struggle to get on the housing ladder.”

“Kiwi houses should be for Kiwi homeowners.”

‘It was a big barrier’

Stuart Nash, who as Minister of Economic Development was part of launching the Active Investor Plus Visa just over three years ago, and is now the CEO of resettlement consultancy Nash Kelly Global, said the changes were “hugely positive”.

Nash said he’d be making phone calls on Monday evening as a result of the changes - about four clients had walked away from the chance to resettle recently because of the inability to buy a house, and he’d now be aiming to get them back.

“My view is that if you are investing a minimum of $5m dollars here, you should be able to buy a house. It was a big barrier to a number of very wealthy investor migrants considering New Zealand - and this will now put NZ back on the radar for a lot of these very wealthy investor migrants who do not just have money to invest, but also the skills, competencies and capabilities to allow our economy to grow.”

Nash was part of the Cabinet that put the so-called foreign buyer ban in place in 2018. So what had changed between then and now?

“[The ban] was done for a very good reason; for the right reason,” he told The Post.

“But it was a very blunt instrument and there are always unintended consequences - this was one of these unintended consequences.

“If an investor migrant decided to immigrate here, i.e. become a tax resident, and spend over 183 days, they could already get an exemption to buy a house. This now allows people who don’t want to become a tax resident but do want permanent residency …at this point in time, when you have got so much global uncertainty around, a lot are looking not for a tax haven but for a safe haven.”

Buying such expensive property, “these people don’t compete with first home buyers - they compete with lotto winners”.

That view was echoed by former Clutha-Southland MP Hamish Walker, who now sells luxury property in Queenstown as part of his own firm Walker and Co.

He said the price point of investing in property over $5m was about right.

“I think it’s good because you do have to protect Kiwis first - you don’t want to make it any harder than it is at the moment for say first home buyers and people trying to get into the market, but from my experience these clients are not looking at properties worth $1,2,3 million - they’re looking well north of $5m, up $10- 15m in some cases,” he said.

Is there enough stock for them?

“Yes, for example in Queenstown there’s roughly about just over 60 on the market at the moment worth more than $5m, and then every year there’s roughly 35 transactions in Queenstown in that bracket.”

Overall, today’s changes were positive for places like Queenstown, Walker told The Post.

“Foreigners bring much needed capital and networks and are very generous - they’re often the first ones to write cheques out for community causes.”

Luxury real estate agent Caleb Paterson said the change had been a long time coming, and that many people had been waiting for it as it opened up the buyer pool coming to the luxury market.

Over the last four to six weeks as rumours swirled that a change might be coming, he had seen domestic buyers starting to take action and look at the market, he said.

That was because the luxury market had been very flat for some time, and a potential influx of buyers would prompt more competition.

He had been getting a lot of inquiries from foreign ultra high net worth individuals going through the visa process who were anticipating the change.

“It would be exciting to see an increase in the volume of sales coming through the luxury market, but I don’t think we’ll see a pop in house prices in this space right away.”

It was worth noting there had been a significant withdrawal of luxury stock that was on the market over the last year, he said.

“In Auckland alone about 40% of the luxury properties that had been listed and did not sell had subsequently been taken off the market.

“Now, we’re coming into the traditional buying season and there’s less listings available than there was. So we could see a lot more properties coming on to the market now.”

Paterson said 10 prospective sellers had contacted him already, while potential buyers going through the visa process were saying “hallelujah”.

Queen City Law managing director Marcus Beveridge works with overseas investors and developers. He said the change would not impact on many homes, and should have been made a year ago.

“Telling golden visa applicants they can bring $5 million to $10m into the country, but can’t buy a home here is pretty crappy.”

There had already been good interest in the golden visa, and this change would really open the door to investors, he said.

“Because the underlying factor is that home is where the heart is, and the longer people can stay here and get comfortable and enjoy life here the more they will invest here, and create jobs.”

Not all golden visa applicants would want to buy or build a home in New Zealand, but the fact they would be able to was attractive - particularly as other countries, such as Australia, were closing their doors, he said.

“When you get this sort of change it sends a positive message, and it gives a bit more confidence to the broader market, and can prime the pumps a bit. So the stars are aligning, and I’m all for it.”

Cotality’s Kelvin Davidson has previously said that before the Labour government introduced the ban, the number of foreign buyers involved in property transfers was very low, about 1% to 2% of purchases nationwide, according to Stats NZ figures.

Managing director of New Zealand Sotheby's International Realty Mark Harris said he takes weekly calls from wealthy foreigners interested in buying homes in New Zealand.

In the past 12 months, Sotheby’s website has had a 120% increase in web traffic from American customers, he says.

The eastern and northern suburbs of Auckland including Waiheke, as well as the Bay of Islands, Queenstown and Wanaka were areas of interest for foreigners, he said.

He did not believe it would cause a dramatic increase in price, but would no doubt encourage buyers at that end of the market.