Why Invest in New Zealand Real Estate
The New Zealand Government actively encourages overseas investors to invest in New Zealand houses, recognising the important contribution foreign investment makes to the development of New Zealand's industry, resources and community.
New Zealand has established itself on the world stage as a superior property investment location. Famous for its breathtaking scenery, clean green environment and friendly people, the benefits of New Zealand real estate go beyond its excellent financial gains. At the same time, New Zealand is a dynamic first-world society with sophisticated cities and a vibrant arts and cultural scene. As a result of the 2014 ‘Doing Business Project’ by the World Bank Group, New Zealand has the No.1 ranking for protecting investors.
The New Zealand property market has an opportunity to benefit from strong national population growth due to New Zealand’s progressive immigration policy and birth rates. Many parts of the country are experiencing housing shortages translating into strong tenant demand and price growth. For property investors, this represents outstanding potential growth in demand and return on investment.
There are many other benefits for investing in New Zealand including:
High rental yields
Most large cities around the world experience solid capital growth but lack the rental returns. New Zealand boasts rental yields of 5-10% in most of its major cities which is fantastic for an investor seeking a capital growth orientated market whilst still maintaining a good cash flow position.
Tax friendly nation
New Zealand is an investment friendly country with no stamp duty, mortgage stamp duty, land tax, property purchase tax, nor capital gains tax (if the property is owned for more than two years and you have the intention of purchasing for rental income). Some countries (e.g. Australia), require property buyers to pay stamp duty tax, up to 3-4% of the purchase price.
Australian investors also receive excellent tax incentives from the Australian Tax department for owning New Zealand real estate. If you are on the highest marginal tax rate, owning New Zealand real estate can provide great tax benefits.
Great exchange rates
The New Zealand dollar has traditionally been weak against the Australian dollar, US dollar and UK Pound Sterling. These favourable exchange rates make the New Zealand property market even more attractive for overseas investors.
A Government that welcomes overseas investment
Buying from overseas is simpler than it sounds. The New Zealand Government has no major barriers for overseas property investors. The Government encourages foreign investment of New Zealand houses to help meet the growing population's increasing demand for property.