New Zealand is a dream vacation destination for many of us, whether you want to visit its quirky yet culturally rich cities or seek solitude in the country’s natural splendour. With so much on offer, it’s no wonder that so many people decide to stay as long as possible after their vacation and settle in New Zealand for a while.
If you’re lucky enough to have the opportunity to live in New Zealand for longer, you might be considering buying a property. There are legal restrictions on who can buy properties of different types in New Zealand, which you’ll need to know about if you’re considering purchasing real estate there. ¹ ²
You’ll find an overview of these rules, as well as details about the costs of renting and purchasing properties in different cities in New Zealand in this guide. We’ll also cover the best ways to finance your purchase if you do decide to make the leap, including ways to avoid high international transfer fees by using a specialist service like Wise.
The cost of living in New Zealand varies significantly between cities. The south island is also typically cheaper compared to the north. This means that no matter what your budget, you’ll find the right property for your needs in New Zealand.
Before deciding where you’ll settle, it pays to do some homework. The real estate price per square meter is highest in Auckland — almost 20% more for a city centre property than buying in the second most expensive city, Tauranga. But if you’re looking for something more affordable, you’ll also find a wide range of options in the smaller cities and more rural areas.
Buying a property in New Zealand as a foreigner is subject to strict regulation. You’ll need to confirm you’re eligible to buy, before confirming any purchase. In general, you’ll need a resident visa to be able to buy a property to live in, although non-residents may be able to buy other property types, including commercial buildings. The rules are complex, so taking early advice is essential.
Here are average real estate prices for a few of the largest cities in New Zealand to get your research started.³
|City||Average housing price per square meter (NZ$)|
|New Zealand — overall average||Apartment in city centre: $6,841.60 Apartment outside the city centre: $5,304.33|
|Auckland||Apartment in city centre: $9,865.00 Apartment outside the city centre: $8,141.14|
|Christchurch||Apartment in city centre: $4,979.17 Apartment outside the city centre: $3,664.50|
|Wellington||Apartment in city centre: $6,455.41 Apartment outside the city centre: $4,459.56|
|Tauranga||Apartment in city centre: $8,250.00 Apartment outside the city centre: $5,133.00|
All of the property pricing data used in this guide comes from Numbeo.com. Data is collected continuously from people living in different cities and countries around the world, to allow comparison of costs of living.
Data on Numbeo is dynamic and updated frequently to reflect changes in market prices. The figures provided here are accurate at the time of research (10th April 2019). You can get live costs of living for your chosen area, and compare different cities around the globe, on Numbeo.com.
If you’re buying an overseas property you may need to pay a deposit, legal fees and other costs using international transfers. This can become expensive, as cross border banking charges with traditional banks are typically high, and there may be a markup added to the exchange rates used which pushes the costs up higher.
Don’t pay more than you have to for international transfers. Check out modern alternatives to your regular bank, such as Wise. Wise use the mid-market exchange rate on all international payments — that’s the same rate as you’ll find on Google. There’s no markup, and no hidden costs to worry about. Instead, Wise simply charge a low, upfront fee for the transfer — which can work out much cheaper than using a traditional bank. All payments are covered with bank level security, so your money is safe no matter where you’re sending it.
If you’re making regular international payments or planning on moving to New Zealand for a while, you might be able to save even more time and money with a Wise borderless account. You’ll get your own bank details for New Zealand, the US, UK, euro area and Australia, to receive payments into the account in multiple currencies. Switch between currencies when you want to, using the mid-market exchange rate and for just a small fee. You’ll also be able to make convenient international payments and hold over 40 different currencies in your account at the same time. Exactly what you need, if you live an international lifestyle.
If you’re eligible to do so, you might choose to buy a property in New Zealand as an investment. By renting it out you could make some income, as well as benefiting from the capital gains if the property increases in value over time.
It’s important to note that the rules about foreigners buying property in New Zealand are strict and somewhat complex. To be eligible to buy a property you may need to apply for consent, and you’ll usually have to have a resident class visa. Get some advice from a specialist before you decide how to proceed.
To get a flavor of the rental yields you might achieve if you’re able to invest in property in New Zealand, here’s a run down of the average rents for different property types in a few major cities.
|City||Average monthly rental costs (NZ$)|
|New Zealand — overall average||1 bed apartment in city centre: $1,486.701 bed apartment outside the city centre: $1,210.76 3 bed apartment in city centre: $2,434.563 bed apartment outside the city centre: $1,966.65|
|Auckland||1 bed apartment in city centre: $1,831.001 bed apartment outside the city centre: $1,463.51 3 bed apartment in city centre: $3,303.003 bed apartment outside the city centre: $2,429.06|
|Christchurch||1 bed apartment in city centre: $1,365.451 bed apartment outside the city centre: $1,135.71 3 bed apartment in city centre: $1,964.433 bed apartment outside the city centre: $1,809.22|
|Wellington||1 bed apartment in city centre: $1,724.72 1 bed apartment outside the city centre: $1,421.68 3 bed apartment in city centre: $3,118.823 bed apartment outside the city centre: $2,422.44|
|Tauranga||1 bed apartment in city centre: $1,659.781 bed apartment outside the city centre: $1,383.91 3 bed apartment in city centre: $2,500.003 bed apartment outside the city centre: $2,106.88|
If you have a property in New Zealand as an investment, and are getting paid rent in New Zealand dollars by a tenant, you can open a borderless account from Wise, to receive payments fee free. Once you have money in your borderless account, you can transfer it to US dollars for a low fee, using the mid-market exchange rate. You can also sign up now for a linked debit card, which will make spending your rental yield even easier, at home or abroad.
Before you can buy a property in New Zealand you’ll need to make sure you are eligible.
In general, you can buy real estate if you are a New Zealand, Australian or Singaporean citizen or permanent resident, or have a resident class visa for New Zealand. There are additional requirements if the property is deemed to be sensitive for any reason, although it may be easier for foreigners to buy commercial properties than homes to live in. Because the rules are complicated, you’ll need to get specialist advice before you choose a home or other property to purchase.
There are legal caps on the size of loan a bank can offer any individual. You’ll need a 20%–30% deposit before you can be considered for a mortgage in most cases. Assuming you can meet all of the requirements, you should be able to work with one of the major New Zealand banks, which have migrant banking services to walk you through the requirements to get a mortgage as a foreigner.¹ ²
Construction in New Zealand — as with many other regions — took a dive after the global financial crisis in 2008. However, the trend overall has been upward since around 2011, with new dwelling consents back to pre-crisis levels. ⁴
The amount of construction varies significantly from region to region, with Auckland driving the increase in real estate activity in the final part of 2018. In fact, some 25% of all building in New Zealand during the last quarter of 2018 took place in Auckland.⁵ If you’re considering buying a place soon, it’s well worth checking out the most recent construction industry figures to see where property numbers are on the increase.
New Zealand is a popular expat destination — and for good reason, with its amazing natural scenery and buzzing, friendly cities. However, if you want to buy real estate there you’ll need to research the eligibility rules to make sure your visa class entitles you to purchase the property you have in mind.
Once your purchase is underway, it’s important to find the most cost effective ways to pay for your deposit, legal and other costs, especially if you’ll be making international payments. Banks don’t always offer a great deal on cross border transfers, so you could find you’re better off with a specialist like Wise, for low fee international payments which use the mid-market exchange rate every time.
All sources checked 10 April 2019
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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