Labour would exempt Australians from any restrictions it might put on foreign buyers of New Zealand real estate.

In a move that raises questions about the reasons for appearing to single out Chinese residents, Housing spokesman, Phil Twyford says the Australian exemption is because of the Closer Economic Relationship with Australia.

Yet ironically New Zealand’s Overseas Investment Officer requires Australians intending to buy “sensitive” land here (the only land over which it has jurisdiction) to go through exactly the same process as Chinese buyers.

Meanwhile the NZ Herald which broke the original story about the data leaked to Labour now claims that the percentage of recent Chinese buyers could be as high as 90%.

 But back in the Labour Party Mr Twyford has been continuing to assert that Labour would ban all foreign buyers.

He repeated this claim in a piece he wrote for the Herald. 

But he told POLITIK that “sometimes simplicity is the enemy of nuance.”

“Our policy is to ban all foreign buyers with the following exceptions —“If you intend to come here and settle.”

“If you build new.

“Australians – in the spirit of CER, given that they exempt Kiwis from their restrictions on offshore speculators.”

Advertisment

In fact Australia exempts New Zealanders only from the restriction on foreigners buying existing urban properties.

According to the New Zealand High Commission in Canberra “New Zealand citizens who wish to buy rural or commercial property in Australia, like all other foreign citizens, would likely need to obtain Foreign Investment Review Board approval.”

Other political parties have now joined the debate though the Government is keeping strangely silent no doubt happy to see Labour copping it for being racist.

“Rampant property investment, not ethnicity, is driving up demand for Auckland houses,” Green Party Co-leader Metiria Turei said. 

“Non-resident foreign buyers should be prevented from investing in the New Zealand housing market, but if parties are serious about dampening the demand for Auckland property, they need to deal to tax incentives that are encouraging locals to invest in property too.”

And NZ First leader Winston Peters said when his party raised the problems caused by overseas buyers it was blasted as being xenophobic and racist.

“We’ve been saying for a long time that the housing problem in Auckland is one of supply, and it’s being exacerbated by massive demand inflated from abroad,” he said.

Meanwhile the Economic Consultancy Infometrics is arguing that it is the size of land that Aucklanders want their houses sited on which is causing part of the price problem there.

They say their research shows that the affordability problems in Auckland’s housing market are not solely being caused by cyclical factors such as strong migration inflows and a lack of new house building over recent years.

“The median house price in Auckland is now equivalent to 11.3 years of average income in the region,” says their Chief Forecaster Gareth Kiernan.

 “New Zealanders’ aspirations of the size of house they can own, and particularly the amount of land that comes with that house, are not realistically aligned with our actual incomes and wealth positions.

“Land prices are particularly critical in Auckland, and by clinging to the Kiwi dream that we should all be able to own our little piece of New Zealand, a significant proportion of society is effectively being priced out of the housing market.”

“Home buyers’ expectations need to be realigned to a greater acceptance of terraced housing and apartments as liveable options,” said Mr Kiernan.

But with Auckland house prices up 26% in a year it is likely pressure will stay on this issue from potential buyers who feel they are missing out on the market.

CRACKDOWN ON MONEY LAUNDERING 

Meanwhile Justice Minister Amy Adams announced yesterday that real  estate agents would be brought within the scope of the Government’s anti money laundering regulations. 

Along with the Organised Crime and Anti-corruption Bill the move would require the agents and other professionals including lawyers, accountants and conveyancing practioners among other things to report any cash transactions for more than 10,000.

There have been some anecdotal stories of foreign buyers using cash to close house purchases in Auckland.