Homes are becoming less affordable for Kiwi buyers as prices continue to rise on the back of increasing foreign investment in New Zealand’s property markets.
Although Asian investment comprises a healthy majority of foreign buying in the country and are certainly singled out as being the main driver of price hikes, other nationalities are steaming in on Antipodean real estate. With Asian capital investment in Kiwi property with almost half the market share, there is still a considerable percentage – around 54% – of buyers from Australia, Europe, UK and South Africa.
Media speculation in New Zealand has unfairly pointed the finger at Asian investors as being responsible for driving up property prices to the extent that local residents are unable to buy principal residences. Reports have included new million-dollar homes in the Vaughan Farm development in Long Bay were almost all vacant having been ” bought by rich Asians and left unoccupied to reap the capital gain “.
However press reports have not been substantiated by any proof and the country’s estate agents are keen to highlight New Zealand real estate’s attraction to overseas buyers from outside Asia. New Zealand has always been a popular investment destination for Asian capital, particularly in recent years with the degree of wealth generation China has enjoyed.
However, more than 20% of foreign buyers in NZ property markets in 2014 were from Australia compared to 25% from China and so there seems to be little evidence of imbalance. There are many reasons why investors are attracted to the country’s property markets, not least it’s stable economic climate, great quality of lifestyle and the sheer beauty of its landscape.
Where perhaps Kiwis are being priced out of domestic property markets, Australians still see a lot of value represented in the country’s real estate. Many Australian buyers are miners getting good tax refunds they wish to invest in property and in the absence of value in their own country, they are looking further afield for property in New Zealand .
A high percentage of purchases in New Zealand’s property market are said to be for straight investment purposes. Obtaining a mortgage in the country is a fast process, often taking as little as 47 hours to complete. Many agents across the nation anticipate a continued rise in Chinese investment although not disparate with growth in capital from other nationalities.
Source:: Property show rooms