Foreign buyer bill passes first reading

NZ Newswire,
Publish Date
Tuesday, 19 December 2017, 5:18p.m.
The Government bill will stop foreigners buying homes. (Photo / NZ Herald)
The Government bill will stop foreigners buying homes. (Photo / NZ Herald)

The bill that will stop foreigners buying houses has passed its first reading in Parliament amid Opposition claims that it's been designed to solve a non- existent problem.

It implements a key election campaign commitment from Labour and NZ First.

"We think it is the birthright of New Zealanders to own our houses and farms," said David Parker, the minister in charge of the bill.

"They should not be able to be outbid by wealthier people from overseas who pay little or no tax on their investments."

Parker said foreigners did not have a right to own homes in New Zealand.

"Under this bill only New Zealand and Australian citizens and permanent residents will be able to buy an existing home," he said.

Foreigners will be allowed to buy land and build a new home on it.

National's Steven Joyce said the Government's definition of the problem was wrong.

"Labour and New Zealand First have maintained foreign buyers are a problem - but every government department that has looked at this says overseas buyers, including Australians, make up about three per cent (of total sales).

"The whole problem definition falls apart, the net effect of this is about nil."

Labour has never accepted the three per cent figure and during the first reading debate, Government MPs said it could be as high as 20 per cent.

The bill will amend the Overseas Investment Act, putting residential sections into the "sensitive" category so that sales can be restricted to citizens and permanent residents.

Australians will be exempt because of the Closer Economic Relationship.

The bill passed its first reading 63-57 and has been sent to a select committee for public submissions.

It must be reported back by February 20 because the government wants the bill in law before the revised Trans-Pacific Partnership is signed.

If that didn't happen, the legislation would clash with provisions in the free trade agreement.

As it is, the ban is going to contravene the FTA with Singapore and the government is negotiating a way around that.

- NZ Newswire

ON AIR: Mike Hosking Breakfast

6a.m. - 8:30a.m.