Foreign investors who bring significant capital into New Zealand will be allowed to buy high-value residential properties by the end of the year, Winston Peters says.

The New Zealand First leader has softened his opposition to foreign citizens purchasing homes, and is willing to carve out an exemption for eligible investors.

Peters told Interest.co.nz the Foreign Buyers Act would remain unchanged, but other reforms to investment visas and rules were likely to be completed before the end of 2025.

“We’re talking about investment. We’re changing those rules and what goes with them. You have to be patient and I’ll tell you what the details are. But the Foreign Buyers Act is not changing,” he said.

“If you’re investing millions of dollars, then we’ll seriously look at if you have the right to back that up with the buying of the house of New Zealand at a certain cost — and that cost is not $2 million.”

Prime Minister Christopher Luxon told reporters there were ongoing negotiations between the parties and he didn’t want to comment until a policy was ready to be announced.

“When we come out with an answer, you will hear about it, and we’ll be very clear about it all. But right here, right now, we’ve got ongoing conversations,” he said.

“You’ve heard what Winston said yesterday, and that’s a fair reflection of where things are at.”

Stamp duty stamped out

In an interview on Wednesday, Peters said party consultation was underway on terms that would allow major investors, such as those on the Active Investor visa, to buy high-value homes.

National had previously proposed allowing foreign buyers to purchase homes worth more than $2 million, with a 15% transaction tax to fund income tax cuts.

Peters told Interest.co.nz he wasn’t considering a revival of that policy. His plan would be far more limited, applying only to eligible investors and wouldn’t include any purchase tax.

“No, that was the National Party’s policy. It was fiscally never going to work, we said so before the election, before suddenly you guys caught on,” he said.

“We’re talking about investors who bring billions to this economy. They’re not buyers. You’re not going to get a house key just by walking in, the way that other parties believe.”

The coalition government has pursued a series of reforms to attract more capital and investors to New Zealand. However, the foreign buyers ban remains a roadblock.

Changes have included liberalising the Overseas Investment Act, establishing a one-stop investment shop, launching an infrastructure financing vehicle, and hosting a high-profile investment summit.

Golden rentals

Most relevant, however, are the changes to New Zealand’s ‘golden visa’ scheme, which offers permanent residency in exchange for a $5 million growth investment or a $10 million balanced investment.

The growth category covers three-year investments in higher-risk, illiquid New Zealand businesses or managed funds. The balanced category includes listed equities, government bonds, and commercial property, with a five-year holding requirement.

Applicants no longer need to pass an English-language test and must spend only three weeks in the country to be eligible. Nearly 200 people applied in the weeks following the announcement, and could bring in more than $1 billion in capital if approved.

However, many high-net-worth applicants are put off by the inability to buy a home in the country they’re investing in. The luxury rental market has grown but remains focused on short-term stays, not three- to five-year residencies.

NZ First appears willing to let large investors purchase ultra high-end properties regardless of residency status, while continuing to exclude most foreign buyers from most of the housing market.

This will need to be carefully calibrated, however, as opposition to foreign ownership of strategic assets, immigration, and economic liberalisation were founding principles of the party.