New Zealand Law Society - Ban on most foreign buyers of existing homes passed

Ban on most foreign buyers of existing homes passed

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Parliament has given a third reading to the Overseas Investment Amendment Bill. This introduced limitations on the types of property that can be purchased by overseas persons by bringing residential land into the category of "sensitive land" in the Overseas Investment Act 2005.

With the exception of Australian and Singaporean nationals, overseas persons who are not ordinarily resident in New Zealand will generally not be able to purchase existing houses or other land classifed as "residential" in an amended definition.

Overseas investors will only be able to obtain consent to purchase residential land (that is not otherwise sensitive) in certain situations.

The provisions in the Act will come into force at varying times. The provision relating to exemptions for dwellings in large apartment development where sales of dwellings have begun before the Royal assent will come into force two weeks after the Royal assent. The rest of the Act will be brought into force by Orders in Council, but the Act must come into force two months after Royal assent.

The Treasury website contains information and backgrounders on the new law. Land Information New Zealand (LINZ) says that details of the changes and how overseas developers can apply for consent to buy residential land to build apartments and hotels will be available from early October 2018.