New Zealand is once again allowing wealthy foreign investors to purchase luxury properties, coinciding with increased global instability that has heightened demand for safe, remote havens. As of Friday, individuals holding the country’s ‘golden visas’ can buy or build homes valued at a minimum of $NZ5 million ($4.2 million). This policy change follows delicate negotiations within the coalition government, aiming to stimulate New Zealand’s economy through the Active Investor Plus visa program, which was reintroduced in April to attract affluent migrants and their capital. Paterson Luxury is an Auckland-based real estate firm that specialises in high-end properties. The firm aims to connect discerning clients with exceptional homes and investment opportunities in New Zealand’s premier locations.
The move coincides with increasing interest from American investors, partly driven by recent geopolitical events. Caleb Paterson, owner of Paterson Luxury, noted a surge in inquiries from the US, reporting six genuine inquiries in just four days. Immigration New Zealand data indicates significant interest in the Active Investor Plus visa, with 589 applications covering 1891 people as of February 26, representing a potential minimum investment of $NZ3.5 billion. Approximately 37 per cent of these applicants originate from the US.
Previously, a ban on foreign buyers, introduced by former Prime Minister Jacinda Ardern, prevented these visa holders from purchasing property, despite being able to reside in the country. The ban was initially intended to curb offshore speculation blamed for driving up property prices. However, data at the time showed that foreign buyers accounted for only a small fraction of sales.
The reopening of the luxury property market occurs as New Zealand’s overall housing market continues to face a multi-year downturn. According to the QV House Price Index, property values have decreased by as much as 28 per cent in Wellington and 20 per cent in Auckland since their peak in January 2022. Property consultancy Cotality estimates that approximately 7000 houses in New Zealand are valued at over $NZ5 million, representing a mere 0.4 per cent of the national housing stock.
