With New Zealand’s borders opening back up to the world, many visitors will no doubt once again feel inclined to call our wonderful backyard home.
It is important to be aware of the rules surrounding the purchase of residential property in New Zealand by an ‘Overseas Person’, which requires consent from the Overseas Investment Office (OIO) unless an exemption applies.
The Overseas Investment Act (the Act) is in place to ensure that overseas investment into New Zealand is high quality and in New Zealand’s interests whilst acknowledging that it is a privilege for ‘Overseas Persons’ to own or control property in New Zealand.
Under the Act, to purchase residential property in New Zealand without requiring OIO consent, you must be a New Zealand, Australian or Singaporean citizen. Holders of New Zealand resident class visas and permanent residents of Australia and Singapore can also purchase residential land if they are ‘ordinarily resident’ in New Zealand.
To be ‘ordinarily resident’ in New Zealand, the person must meet the following criteria:
- Have been living in New Zealand for at least the immediately preceding 12 months – not just visiting;
- Have been present in New Zealand for 183 days or more of those 12 months; and
- Be a New Zealand tax resident.
If you are a permanent resident of Australia or Singapore or hold a New Zealand resident class visa but do not meet the criteria for ordinarily resident, you can obtain consent to buy or build a home to live in.
If you are purchasing residential property in New Zealand through a company, trust or other entity, the general rule of thumb is a 25% test. If 25% or more of control or ownership is in the hands of one or more ‘Overseas Persons’, then that entity is also an ‘Overseas Person’.
If you are unsure or need any assistance to determine whether you need consent from the OIO to purchase a residential property, please contact one of TODD & WALKER Law’s Overseas Investment Team: