There are various limitations on foreign ownership of property in New Zealand, but it is by no means impossible for a foreign investor to acquire real estate there. This is great news for business people and individuals looking to change their lifestyle because New Zealand is widely regarded as one of the most desirable countries.
With the exception of “sensitive lands,” a foreigner can buy a house or land in New Zealand without having to become a resident. In addition, consent is also needed if the property in question includes fishing rights or other business assets valued at more than $100 million.
First of All, What Is a Sensitive Land?
The term “sensitive land” is defined under the Foreign Investment Act of 2005. Whereas a suburban home is not likely to fall under the category of “sensitive land,” vacation homes, lifestyle properties, farms, and rural properties do. You should seek legal counsel to establish whether or not the land you desire to purchase is included in the definition of “sensitive land,” as this list is rather comprehensive.
Non-urban land larger than 5 hectares, land on or near a foreshore, seabed, or lake, and land on one of New Zealand’s smaller islands are all examples of the types of land that fall under the category of “sensitive.” Potentially sensitive land includes any area that is either within or immediately adjacent to a protected natural area, such as a park or nature preserve.
Who Is Required to Get Consent?
If you are a foreigner looking to buy property in a country where “sensitive land” is classified, you will need to apply for and receive special permission. A person who is not a New Zealand citizen and who does not have a permanent place of residence is considered to be an “overseas person.” You’ll need permission and evidence that you plan to make New Zealand your permanent home if you already hold a temporary visa or are in the process of applying for one. You may need to prove your visa application and give convincing reasons for why you think you’ll be granted a visa.
If you are Australian but don’t currently call New Zealand home, you are also regarded as an “overseas person” and must provide evidence of a commitment to making New Zealand your permanent residence. Concessional consent may be granted to a person who is a citizen of Australia, who has a permanent resident visa for Australia, or who has a resident return visa for Australia.
You are not required to travel to New Zealand to close on the purchase of your property; nevertheless, it is highly recommended that you personally view the property or have someone you trust personally inspect the property on your behalf before making any final decisions.
Receiving Consent under the Foreign Investment Act
The Overseas Investment Office (OIO) grants the actual consent, which considers several factors (such as whether you intend to live in New Zealand and what advantage New Zealand may get from the transaction) before giving its blessing. For example, buying farmland or attempting to obtain a fishing licence may impose other obligations. The consent application process can be complex; therefore, it’s usually wise to consult a lawyer or land surveyor for help.
Obtaining a permit requires writing a letter to the OIO and can take up to 70 days. If you want to buy a piece of land, the expected time will vary based on the specifics of your application.
Australia’s foreign investment restrictions are less stringent regarding the sort of property, so if you know you want to invest in the region but aren’t sure whether to choose New Zealand or Australia, that’s something to consider. For investors, getting an Australian visa is easier if they plan to buy a property in a new development. This may make a rural property in Australia more desirable than a similar property in New Zealand as a vacation home.
Purchasing a property in New Zealand as a non-resident is possible, although it can be a complex process. While there are some restrictions on non-residents owning property, such as the need to obtain Overseas Investment Office approval and paying non-resident tax, these can be navigated with the help of a lawyer and an accountant. With the right knowledge, non-residents can find great opportunities when purchasing property in New Zealand.
If you are looking to buy a property in New Zealand, look no further than our plethora of expert advice here at PropTech Pioneer. We provide residential investors with expert guidance and new-build property investment strategies so that people can save money and achieve financial freedom. Call us today and let us help you make the best investment decisions moving forward.