New Visa Policy Opens Door for Wealthy Foreign Investors

The New Zealand government has announced significant changes to its residency policy aimed at attracting wealthy overseas investors. Prime Minister Christopher Luxon stated that migrants who invest a minimum of $5 million will be eligible for the newly re-launched Active Investor Plus residency visa. This initiative seeks to bolster the economy by encouraging foreign investment, skills, and connections.

Under the revised policy, holders of the Active Investor Plus visa will be permitted to purchase or build one residential home in New Zealand. This decision comes despite the ongoing ban on foreign buyers acquiring residential properties, which remains intact. The government aims to balance the need for foreign investment with the concerns of local citizens regarding housing affordability.

Luxon emphasized that the minimum value of the home eligible for purchase will be set at $5 million, representing less than one percent of the housing market in New Zealand. He explained, “This change navigates a path between those who do not want foreign ownership opened up, and the desire to attract high net worth investors by deepening their connection to our country to help grow the economy.”

Since its re-launch on April 1, 2023, more than 300 applications have been received for the Active Investor Plus residency visa. If all applications are approved, this could lead to an estimated total investment of $1.8 billion in the New Zealand economy. Luxon highlighted New Zealand’s global reputation as a desirable place to live and expressed a commitment to fostering further economic growth through this initiative.

The announcement has drawn criticism from the opposition Labour Party. Housing spokesperson Kieran McAnulty voiced concerns that allowing foreign buyers into the market will exacerbate housing issues for New Zealand citizens. He stated, “Today’s announcement shows how out of touch Christopher Luxon is. Many Kiwis are already struggling to buy a home, and he has just made it worse.”

McAnulty argued that increased competition at the high end of the market will drive up prices for average New Zealanders, making home ownership increasingly unattainable. He criticized the government’s approach, suggesting it prioritizes wealthy foreign investors over local citizens in need of affordable housing. He added that the rise in homelessness and unemployment, coupled with the rising costs of living, underscores the need for policies that prioritize New Zealanders.

Luxon’s government maintains that the new visa policy is essential for attracting significant investors who can contribute positively to the economy and local communities. As the debate continues, the impact of these changes on New Zealand’s housing market and economy remains to be seen.