Overseas buyer ban rushed through

Past and present state houses in Brockville. Photo: ODT files
The Overseas Investment Amendment Bill will be rushed through after tonight's first reading, with a much shorter select committee period. Photo: ODT files

The Government has been accused of pandering to voters with a "racist itch" as legislation to ban overseas buyers from snapping up existing houses is set to pass its first hurdle.

The Overseas Investment Amendment Bill will be rushed through after tonight's first reading, with a much shorter select committee period – half of which will be over the Christmas and New Year break.

Gerry Brownlee
Gerry Brownlee
That truncation to February 20 is opposed by National, with Gerry Brownlee calling it arrogance and dismissive of New Zealanders who would now have less opportunity to submit on the significant and flawed changes. National wants a report-back date of April 20.

"They don't want scrutiny," Brownlee said. "Parliament will only be back in session for a couple of weeks and the bill will be back in the House."

Trade and Export Growth Minister David Parker said the shortened timeframe was appropriate, because the legislation needed to be through by the time the TPP trade deal comes into effect – and that urgency was the fault of inaction by the previous Government.

"It was National who abandoned the prior consensus on trade. It was National who tried to wedge Labour by forcing us to give up on our belief in trade and/or our desire to keep New Zealand homes in a New Zealand market."

Earlier, Act leader David Seymour made some of the strongest comments against the bill, saying Parker knew the policy wouldn't work, but had to back it because of the coalition agreement with New Zealand First.

"David Parker is not a racist man, but some of the people he sits with are," Seymour said.

David Seymour
David Seymour
"Because the fact of the matter is, that this policy is not going to be effective … you cannot tell the difference between the formal ownership and the beneficial ownership of a house in New Zealand.

"This bill will not do anything to change the real ownership of property … but it will scratch an itch. An itch felt by some of David Parker's coalition partner's voters that maybe those bad people that look different have been buying too many homes."

Parker told the House it was the birthright of New Zealanders to own our houses and farmland.

"We believe that our homes should be traded on a New Zealand market not an international one … the changes that we will make will ensure that more New Zealanders own their own home, and that over time fewer Kiwis pay rent to overseas landlords."

National's Gerry Brownlee said the bill was a "ban that's not a ban", with extensive exclusions.

"While we know about Labour and New Zealand First having a generally xenophobic attitude to property ownership in this country, the facts about who buys land in this country do not bear out the suggestion that that alone is the cause for rising property prices.

David Parker
David Parker

"Instead, we are now at a stage where many people throughout the country are finding that their equity was not quite as good as it was just a few months ago."

NZ First MP Shane Jones said the election delivered the mandate for the changes to property ownership law.

"That side of the House ran a political narrative. They ran an ideology where they were prepared to put Kiwis on the side in order to accommodate overseas interests … those days are over."

Green MP Eugenie Sage said the previous Government had failed to deal with overseas speculators buying property here.

"We want to make it easier for New Zealanders to afford a home, but offshore speculators have been a factor in pushing up Kiwi house prices."

The bill would change the Overseas Investment Act so that only citizens and permanent residents will be able to buy property without being screened by the OIO.

It is part of the Government's 100-day programme, and a rushed select committee process with public consultation will take place early next year.

Under the bill, permanent residents and Australians would have to have resided in New Zealand for at least 183 days of the past 12 months to buy a property without OIO screening.

Eugenie Sage
Eugenie Sage

Singaporeans might also be exempt from screening, unless a resolution can be found that doesn't violate the NZ-Singapore Closer Economic Partnership. That is still being worked through, Parker said today.

Other resident-class visas - including skilled migrants, resident visa holders through work, investors, entrepreneurs, refugees - would be screened. They would be allowed to buy land and build a new home as long as they onsold it - which would add to the overall housing supply.

Those who could demonstrate they intended to live in New Zealand long-term could also buy land for a new home, but they would have to sell the property if they left the country. Anyone on temporary or student visas would not be able to buy a house to live in at all.


I wonder on the implications for many Kiwis who own a property overseas particularly in the UK.

Some of the properties that have been sold to overseas buyers are because the value of the properties far exceed the ability of New Zealanders to repay mortgages on the properties.Or in short they are just too expensive for us to buy.