Twelve weeks following the election of US President Donald Trump, the number of U.S. citizens applying for a grant of Kiwi citizenship rose by 70 percent. Rich millennial speculators like to buy houses in New Zealand for its nature; in fact, over the past decade, three percent of New Zealand house buyers were foreign speculators. However, the phenomenon will not last for long, as newly-elected Prime Minister Jacinda Arden has promised to prevent anyone who isn’t a citizen or a permanent resident from buying houses.
While the framework of the bill hasn’t been released in detail yet, it has been revealed that buying a house in New Zealand will be more expensive and complicated, and that non-Kiwis and speculators looking to buy houses in New Zealand will be required to buy vacant land and build houses themselves.
“We are determined to make it easier for Kiwis to buy their first home so we are stopping foreign speculators buying houses and driving up prices. Kiwis should not be outbid like this,” Arden said. The decree is to be implemented as of early 2018. A roundup of 72,000 migrants came into the country from the beginning of 2017 through 31 May, as opposed to 68,400 year-to-year. This reflects the impact this surge has on the real estate market ,making Aukland, New Zealand’s largest city, the most expensive housing market in the world.
Vancouver in Canada faces similar challenges with foreign speculators, with many wealthy investors (many of whom are from China) flocking to the North American city to buy property. Last year, authorities in Vancouver instituted a 15% “foreign buyers” tax on all buyers who are not Canadian citizens or permanent residents in an effort to stem the flow of foreign property buyers and protect locals against the phenomenon of Owner Unoccupied Housing Units.