Mark Harris: Sotheby's International Reality Managing Director on foreign buyer ban

National promised in the last election to allow foreigners to buy $2m-plus properties - reversing a ban introduced by the previous Labour government – with exceptions for Australians and Singaporeans. 

However, this was vetoed by National’s coalition partner - New Zealand First. 

Sotheby's NZ Managing Director Mark Harris told Heather du Plessis-Allan “New Zealand’s always been of interest – but there’s definitely been a lot of interest of late.” 

Harris said “We’re half-expecting that there might be an announcement that there might be some easing of the foreign buyer rule.” 

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Episode Transcript

Speaker 1 (00:00):
Heather Do to see out.

Speaker 2 (00:02):
The boss of New Zealand Southby says the government is
leaving money on the table by not overturning the foreign
buyer bang. You will recall ahead of the last election,
National wanted to allow the foreign buyers back into the
property market, then plan to tax them and then plan
to use that money to pay for the tax cuts
that we're just announced in the budget. But Winston Peters
put the kibosh on it. New Zealand Southby's managing director
Mark Harris is with us.

Speaker 1 (00:22):
Now, Hey, Mark, hi, how are you very well?

Speaker 2 (00:25):
Thank you? How many how many of these foreign buyers
you reckon want to come into the market.

Speaker 1 (00:31):
There's quite a few. I think we're probably turning away weekly.
You know, wealthy foreigners from the US, the UK, et cetera,
you know who are looking at investing in buying homes
in New Zealand. We're having to say no too. So,
you know, there's quite a quite a lot of interest,
as there always has been in New Zealand.

Speaker 2 (00:45):
Why are they so interested in us at the moment?

Speaker 1 (00:49):
Well, I think there's a you know, there's multiple things
going on around the world as geopolitical stuff in Europe,
and you know, the election in the US, et cetera. So,
I mean, New Zealand's all has been of interest, but
there definitely seems to be a pickup of late. You know,
certainly our website traffic from international bias has increased quite
a lot in the last six months, so you know,
those sorts of things driving interest our way.

Speaker 2 (01:12):
Are you hearing these industry murmurings that Winston Peter's may
be softening on it.

Speaker 1 (01:18):
Yeah, we've had a few of those rumors floating around,
and you know, we're so half expecting in the budget
there might be an announcement around, you know, some easing
up for that foreign buyer rule, potentially a four million,
five million dollar threshold being introduced with a stamp duty.
But you know, it obviously didn't happen, so it must
have been just a rumor.

Speaker 2 (01:35):
I think you don't think that. I mean, we spoke
to Nicola Willis about it earlier and she was pretty
coy about it. I wouldn't answer the question either way,
which suggests to me that I don't know, maybe we
can take some hope from it.

Speaker 1 (01:44):
What do you think, Well, hopefully, yeah, you never know,
later in the year or whenever Winston steps aside, it
might be a turning point. It certainly seems to make
sense to us that they would be encouraging any sort
of investment into New Zealand at the moment given the economy.

Speaker 2 (01:59):
Mark, what properties are these people interested in? Are we
talking about like really big gangster pads in Queenstown?

Speaker 1 (02:08):
No. I had a know a Sydney investor today this
morning looking at something around three or four million dollars
from apartment and of course Australians can buy here at
the moment without a problem, but generally speaking it's you know,
four or five million dollars and above. Sure there are
some that are looking for, you know, big pads, but
I think there was a four or five million dollars
threshold that would be sensible. That there was a stamp

(02:29):
duty on top of that of ten or fifteen percent
that they were paying, and we could use some of
that income off that tax to put back into social
housing or what not to encourage supply. Then I don't
see that affecting the lower end of the market in
terms of prices, which they were obviously initially worried about.

Speaker 2 (02:45):
We haven't missed the surge of interest because remember after
Clovid there was this massive surge of interest in people
move into New Zealand. We haven't missed that boat.

Speaker 1 (02:53):
Have we. I don't think so. No. I think New
Zealand's always going to be a popular place to visit
and to potentially own a holiday home. You know, it's
a pretty attractive place for the reasons aforementioned, and again
we've seen the traffic increase quite a lot in the
last six months. I don't think we've missed the boat.
We just need to make it a lot more simple
for these sorts of investors to come here and buy

(03:14):
a holiday home, because we know when they come here
and they enjoy the place and they have a holiday
home that they can use, they then go further to
invest in local community businesses and many examples of that
are in the Southern Lakes, which is where we're based.

Speaker 2 (03:26):
Market's good to talk to you. Thank you for your time. Mate.
This Mark Harris, New Zealand Southeby's International reality Realty Managing Director.
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