Two Queenstowners who spoke out about the Labour government’s foreign buyer ban five years ago — a high-end builder and a property and immigration lawyer — maintain it’s been totally ineffective.
Under the Overseas Investment Amendment Act, only New Zealanders, Aussies and Singaporeans can buy NZ residential property — the only exception being managed apartments of 20-plus units which non-NZ residents can only use 30 days a year.
Trinity QT Construction’s Wayne Foley says he and other locals who submitted to a select committee hearing believed the ban ‘‘was never going to result in the outcome they were looking for, which was to make more affordable housing available to Kiwis, so they weren’t being bought out by foreigners’’.
‘‘On reflection, five years after [then-Economic Development Minister] David Parker’s initiative to protect affordable homes for Kiwis, he’s proven himself to be a total muppet.’’
Foley says the government’s ‘‘unnecessarily penalised people who would have been massive value-adds for our community’’.
‘‘There’s two things they could do.
‘‘They could have said this [ban] applied to anything under $3 million, then could have adjusted that on an anytime basis.
‘‘And, as has happened in a number of jurisdictions in the Pacific rim, they could have a stamp duty where foreigners pay 15% on any land acquisitions and the locals might pay 1.5%.’’
A number of high-end builders had been concerned work would dry up, but Foley says they’ve remained busy due to NZ and Australian clients.
Lawyer Elliot Goldman says it was hard to prove in the first place foreign buyers were squeezing Kiwis out of the marketplace.
“Unfair” ban: Property and immigration lawyer Elliot Goldman
He also says the ban’s unfair on overseas owners who’ve owned property, no matter for how long, as if they sell they can’t buy back in.
He adds investor migrants had been able to invest in property developments which in creased long-term rental stock.
But, following changes last year, applicants are now required to invest in an NZ tech start-up approved by NZ Trade & Enterprise.
Goldman says the problem is NZ isn’t as attractive as other countries for investor and skilled migrants because, on receiving a resident visa, they don’t have an automatic right to purchase a property to live in.
‘‘An easy fix would be to allow tech investors, doctors, teachers, nurses, engineers, etc, to be able to buy a house as soon as they hold a resident visa.’’
Luxon can see both sides
National Party leader Christopher Luxon says he can see the pros and cons of the foreign buyer ban.
On one hand, he understands how Kiwis feel about getting outbid for homes by foreign buyers, which is why the Labour government took action — ‘‘if [overseas buyers] are competing with everyday Kiwis who are trying to get into the market, it’s challenging’’.
On the other, Luxon says in many cases foreigners are buying very expensive properties so they’re not competing with NZers.
‘‘Also, when they make those investments, [they] come and do other investments in NZ, which is very, very good for NZ — good for jobs and good for our economy.’’
Luxon says National will have more to say about the issue before this year’s election.
