On 1 September, the New Zealand Government announced a major change: investor resident visa holders, including Active Investor Plus (Golden Visa), Investor 1, and Investor 2 Visa holders – will be permitted to purchase or build a home in New Zealand, even if they do not live here permanently.
This is a significant refinement to the “foreign buyer ban” and is expected to bring positive outcomes for New Zealand.
Why was there a ban?
Before 2018, offshore property investors could buy residential properties in New Zealand without any residency or tax implications. This meant anyone – even those on a short visitor visa or who had never set foot in the country – could purchase homes, sometimes leaving them empty and selling later for tax-free capital gains. This speculative activity drove up competition for houses, inflated prices and made it harder for Kiwis to buy homes in the face of this offshore based competition.
The 2018 ban: well-intentioned but overreaching
The 2018 policy aimed to stop offshore speculation, but it also unintentionally affected genuine investor resident visa holders. These individuals had made significant investments in New Zealand, paid income tax, and met all visa conditions, but were still banned from owning a home unless they lived here permanently. As a result, these visa holders had to (and still do) stay in hotels or temporary accommodation when onshore, despite their substantial contributions to the country.
Key benefits of the new Policy
- Boosts investor interest: The change is expected to increase applications for the Active Investor Visa, especially from those who want to invest but cannot live in NZ full-time. Many potential investors have already expressed renewed interest to us based on this announcement.
- Fixes past injustices: Investor 1 and 2 visa holders who bought homes before 2018 can now sell and buy a replacement, resolving a major frustration caused by the retrospective nature of the ban.
- Recognises long-term commitment: Many Investor 1 and 2 visa holders have been invested in New Zealand for years, contributing to the economy and referring others to invest as well (especially the Active Investor Plus/Golden Visa). The change recognises their contribution to the New Zealand economy by their ongoing investments, and their role as ambassadors for New Zealand values and connecting in new investors to the economy.
Eligibility and qualification requirements
More detail is required to be definitive, but here is where we see the settings potentially landing:
- Eligible visas: Active Investor Plus, Investor 1, and Investor 2 resident visa holders (including Permanent Resident Visa holders who previously held one of these visas).
- Investment threshold (excluding home): Generally, a minimum of NZD 5 million invested in New Zealand.
- Investment type: Investments must be in productive arms-length asset classes, outside personal property ownership.
- Minimum holding period: Investments held for at least three years (as per Growth—Active Investor visa rules). We expect this metric to also apply to prior Investor 1 and 2 visa holders (ongoing investment commitment of no less than three years from home purchase).
- No permanent residency required: No need to live in NZ permanently but must meet the onshore presence requirements of the resident visa concerned (where applicable).
Property value and market impact?
We do not forecast any significant (negative) property/market impact resulting from the proposed changes, as:
- High-value homes only: The exemption applies to homes worth NZD 5 million or more – only the top 1% of properties by value (the remaining 99% are not relevant as they will not be subject of new purchase interest).
- Limited buyers: There are only about 300 Active Investor Plus/Golden Visa applicants currently, and not all will buy property. Outside this class, Investor 1 visa holders are also limited in number. As most Investor 2 visa holders live in New Zealand permanently and therefore can currently purchase any property they wish under the existing settings, they do not add a significant numerical impact here either.
- No broad market effect: The number of eligible buyers and homes is very small. According to the Prime Minister under media questioning, there are approximately 1.9 million homes in New Zealand, the top 1% of that cohort (meeting all eligibility criteria) relates to approximately 10,000 homes only. There are nowhere near that number of Active Investor Plus, Investor 1 or 2 Visa holders. We believe that less than 1,000 homes will change hands in the short to medium term under the new setting, that’s only 0.05% of New Zealand’s residential housing stock.
Location and community impact?
We see two main ones here, being:
- Location: Most eligible properties are in Auckland and Queenstown (90%), but the policy will encourage building new homes in other regions, supporting local construction and related employment. We are already fielding questions about investors wishing to build outside Auckland and Queenstown.
- Community benefit: Investor visa holders often contribute philanthropically to their communities, and this change is expected to enhance those connections with a property connection to those communities. It’s a natural downstream consequence with the creation of a firm connection with communities, that property ownership can create.
Why is this sensible?
This policy is a targeted and sophisticated refinement that addresses the negative unintended consequences of the original setting, while encouraging more investment into New Zealand outside residential property.
It allows investor visa holders to form a greater connection to the country and their communities, rather than living out of hotels. The limited scope ensures it won’t drive up prices for most buyers and may even boost local economies and philanthropy as a result.
The bottom line
This is a smart, balanced update that fixes past issues, encourages investment, and strengthens New Zealand’s global connections—without hurting local home buyers.
It’s a win-win for the country and for committed investors looking to call New Zealand home, even part-time.
