28 November 2019
Overseas investors have committed to building hundreds of new houses and apartments in the year since overseas investment rules changed.
In October 2018 the Government changed the Overseas Investment Act to limit overseas purchases of residential land unless they met clear objectives, including developing land and adding to New Zealand’s housing supply.
Under the increased housing pathway, 7 one-off consents have been granted for investors to develop lots for up to 240 homes and to construct 90 apartments.
The changes also introduced residential standing consents. These allow investors to report to the Overseas Investment office (OIO) after settling specific types of transactions.
Standing consents are intended for quality investors with a proven track record and detailed business plans. Applicants must meet the investor test and show they have processes in place to comply with standing consent conditions.
Conditions provide limits about transactions and geographic areas, development and construction milestones to ensure the increased housing outcome is met, and mandatory post-settlement reporting.
After each transaction settles, the OIO reviews the purchase for compliance and monitors developments for progress towards milestones.
Since October 2018, four residential standing consents have been granted by the OIO. This will see an extra 1,220 hectares of land developed for housing and long-term accommodation facilities. The standing consents are for:
- Fletcher Residential to develop 200 hectares
- Ryman Healthcare to develop 500 hectares
- Metlifecare to develop 120 hectares, and
- The Neil Group to develop 400 hectares.
Transitional exemption certificates were available between October 2018 to February 2019. More than 30 large apartment developments were granted certificates, which allow overseas people to buy residential apartments in a development without needing OIO consent.
A further 8 large apartment developments now have exemption certificates. These certificates allow overseas people to buy, but not live in, new dwellings without OIO consent, provided a minimum of 40% are sold to New Zealanders.
New retirement villages
During the past year, the OIO has granted 3 consents for new retirement villages to be constructed in New Zealand.
The most recently approved consents will see Summerset Group Holdings construct new retirement villages in Cambridge and Canterbury.
In Cambridge, Summerset will construct approximately 290 retirement units and 43 care beds on a 9.5-hectare site. Once construction is complete, approximately 30-40 full time jobs will be created.
Summerset has also acquired a 14-hectare site in Rangiora to construct 320 retirement units and 43 care beds. Approximately 30-40 full time jobs will be created once construction is complete.
At the end of each month the OIO publishes decision summaries for applications decided in the preceding month. Join our mailing list to receive monthly updates about new decisions.
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