Why it’s time to align our investment policy with global opportunity

Foreigners Can Invest Millions — But Still Can’t Buy a Home

Since 2018, foreigners have been banned from buying residential property in New Zealand. Before then, the market was open — both residential and commercial. Today, while commercial and industrial property remains accessible (except where sensitive land is involved or the value exceeds NZ$100 million), residential real estate is still off-limits to most foreign nationals.

Yet, ironically, New Zealand’s revamped golden visa scheme — officially the Active Investor Plus visa — is attracting a surge in interest from high-net-worth individuals across the globe, particularly from the United States. According to government data, over 100 visa applications covering 346 people were lodged in just six weeks, representing a potential NZ$620 million in capital investment.

If sustained, this could mean over $10 billion entering our economy annually. But there’s a catch: these investors still can’t buy a home.

The Policy Paradox: Welcome to New Zealand — Just Don’t Get Comfortable

The government wants foreign capital. The golden visa invites it. But the foreign buyer ban sends a contradictory message.

Investors can:

• Move here
• Live here
• Employ Kiwis
• Build businesses here

…but not buy a family home.

As I recently told Bloomberg,

“A sensible way forward would be that anyone who successfully obtains a residence visa under the golden visa scheme is eligible to buy a family home here.”

Currently, we’re telling millionaires they’re welcome to invest — just not to unpack. That’s not just confusing — it’s counterproductive.

Real Estate Voices Echo the Concern — and Global Media Is Watching

This isn’t just a local issue — international media is taking notice.

In a recent Bloomberg article (May 2025), I was quoted discussing the contradiction between welcoming investment and blocking home ownership.

Jim Rohrstaff of Legacy Partners, also speaking to Bloomberg, described the “tremendous amount of pent-up demand” among wealthy Americans. He noted:

“They’re staying in some of the beautiful luxury lodges around the country... But there is an expiration date to that visit.”

Without a change in policy, that demand may never materialise into long-term economic benefit.

Why the Ban Exists — and Why It No Longer Fits

The current foreign buyer ban was introduced during the Ardern administration, partly in response to:

• Housing affordability concerns
• The Peter Thiel “passport-for-purchase” saga
• Suspicions of speculative buying from offshore parties, particularly from North Asia

But that moment has passed. Today, the global economic landscape, migration flows, and capital markets have shifted dramatically. So too must our policies.

The Golden Visa Is Working — So Why Create Roadblocks?

The Active Investor Plus visa has proven effective. Applicants are serious. But denying them the ability to buy a home without delay, or requiring complex applications to the Overseas Investment Office (OIO), risks undermining the entire effort.

Prime Minister Christopher Luxon noted that lifting the ban “is not the be-all and end-all of attracting investment.” But it is a critical enabler of making relocation viable.

Here’s Where It Gets Complicated: Tax and Residency Rules

New Zealand’s tax system interacts oddly with our immigration settings. Under golden visa rules:

• Immigrants can obtain permanent residence without becoming tax residents
• They only need to spend minimal time here (as little as 21 days over 3 years)
• A four-year grace period applies to worldwide income

Still, if they do wish to buy a home, they face hurdles — unless they become NZ tax residents or go through the OIA process, assuming they are eligible.

Clarifying the OIO rules for residential land:

• You must be “ordinarily resident” in order to buy a residential home. To be ordinarily resident, you must meet 4 criteria:
• You must have a residence class visa
• You must have lived in New Zealand for at least the last 12 months
• You must have been physically present in New Zealand for at least 183 days of the last 12 months
• You must be a tax resident of New Zealand.
• If you hold a residence visa and haven’t lived here for the required period but intend to live in New Zealand indefinitely, you can apply to the OIO for consent to purchase a residential home.
• Some conditions may attach including that you move to New Zealand within 12 months of consent being granted and that you become ordinarily resident within 2 years of the consent. If conditions are not satisfied, the OIO may require you to sell the land.

Policy Drift: What the Coalition Said (and What It’s Saying Now)

Before the 2023 election, National proposed lifting the ban for foreign buyers purchasing homes over $2 million, claiming this would:

• Protect first home buyers
• Attract foreign capital
• Raise tax revenue

The coalition partner, New Zealand First, opposed this at the time. But recently, Rt Hon Winston Peters suggested that allowing foreigners to buy luxury homes might be a reasonable compromise (we predict $5 million to be the threshold).

We expect to see this change formalised into law in the coming months.

If this proceeds, it may mean the following groups could trade in residential real estate:

• New Zealand citizens and residents
• Australian citizens (and Aussie permanent residents if ordinarily resident)
• Singaporean citizens (and Sing permanent residents if ordinarily resident)
• Golden visa holders
• Foreign buyers purchasing properties worth over $5 million

Meanwhile, Australia Is Becoming More Attractive for Aussie First Home Buyers

In contrast, Australia is doubling down on policies that encourage home ownership. Labour’s new Home Guarantee Scheme, coming into effect in 2026, will:

• Allow first home buyers to purchase with a 5% deposit
• Remove income caps
• Eliminate lenders’ mortgage insurance

For many young, skilled Kiwis, the pull to Australia is getting stronger — and our own policy settings may be pushing them away.

Harmonising Golden Visa and Property Development Rules

A pressing challenge is how the new golden visa intersects with:

• The Overseas Investment Act
• Property development regulations
• Tax residency rules

Currently, there’s matters remain confusing. The FIF rules are being reviewed. No doubt the Government will ultimately need to generate more tax. And from time to time we observe that key decision-makers do not fully understand the complexity of the systems they are fiddling with and designing.

We anticipate that there may be significant issues arising in the future around pushing millionaires into the Growth category. Instead of investing $10 million for 5 years, an applicant can invest $5 million for 3 years (and spend less time onshore). In New Zealand, most business loans are secured by way of property. The AIP rules have made investment in property more clunky. Such things happen sometimes when inexperienced bureaucrats are pulling levers resulting in unintended and poorly designed consequences.

As it stands, the policymaking approach resembles more of a “touch it once, touch it wrong” philosophy than the strategic alignment we need.

So What Now?

New Zealand is competing globally for talent and capital. We have the fundamentals to succeed: a clean environment, stable political system, and attractive lifestyle. But our real estate policy is out of sync with the opportunity in front of us.

Reforming the ban isn’t about “selling out” — it’s about strategic alignment.

If someone:

• Meets the strict visa and investment criteria; and
• Intends to live in New Zealand; and
• Has legally invested millions into our economy…

…then most will concur that they should be able to buy a home here.

Final Thoughts: The Interest Is Real. The Investment Is Ready.

Whether through reforming the current OIO pathways or legislating a $5 million exemption threshold, we need to send a clear message to the world:

New Zealand is open for investment — and open to smart, long-term residents who want to make Aotearoa home.

Want to Know More?

If you’ve read this far and want to discuss further, contact:

Marcus Beveridge
Managing Director – Queen City Law
EMAIL MARCUS or EMAIL ANDREW

Disclaimer: This blog is general commentary only and is not legal advice. Always seek tailored legal advice before making investment or immigration decisions.

📰 Source:

• Bloomberg, May 2025 – “Rich Americans Ready to Swoop In If New Zealand Relaxes Home-Buying Ban” (Paywalled)