Right now, New Zealand is going through a house and land boom. In some areas, real estate prices are even higher than that of London’s. Last year the market had huge growth since the financial crisis of 2008.
But this all didn’t happen by chance. It was mostly because of a stable government, a healthy economy and reasonable interest rates. Another factor was the rush of people trying to leave their current country – particularly the British and Americans.
According to economists, New Zealand ranked second in the world with a growth rate of over 11%. This was only second to Turkey. The only other country that held a double-digit rate was Canada.
Since the Brexit vote in June, the number of inquiries from Britain was more than double compared to the year before. Around about 10,000 Brits showed their interest compared to 4,600 last year during the few weeks after the vote.
During the first month after Trump took office the amount of inquiries from the U.S was seven times more when compared to the normal rate.
Because of this huge increase of interest from foreign buyers, in July New Zealand’s central bank pushed the deposit requirement up to 40% for investors. This is to help control the property prices that are forcing locals to pay expensive rent.
Overseas buyers need approval from the Overseas Investment Office for property that’s considered “sensitive land”. This includes farmland of more than 12 acres, sections close to reserve areas of more than an acre and sections that are more than half an acre and join to a waterfront.
Other advantages of the house and land model
Foreign applicants are also expected to show how their purchase of a house and land can benefit New Zealand economically.
On the other hand, the requirements for urban property in Auckland are much less strict, even though local banks will still need a deposit for foreign buyers who are wanting a mortgage.
Are you an investor or potential homebuyer? If you’re looking to purchase a house and land package and you want to live in Christchurch or Canterbury, then talk to Build7.
Our experienced team will help you get the property of your dreams for the right price. The best time to build a new home in Christchurch is now.