Buying a home in New Zealand under the new investor visa pathway

Key takeaways

Only specific investor visa holders qualify. Investor 1, Investor 2, and Active Investor Plus visa holders are eligible. Visas granted before July 2009 do not qualify, even where investment was a condition.
The pathway targets offshore investors. Visa holders who are already ordinarily resident in New Zealand (resident visa plus 12 months residing here plus 184 days physically present) can already buy property as if they were New Zealand citizens and do not need this pathway.
Companies and trusts can invest, but the structuring rules are complex. Advisers without specific Overseas Investment Act experience should refer clients to specialist legal advice rather than attempt corporate structuring themselves.
Only residential land qualifies. “Residential” is determined by the property category on the District Valuation Roll (codes starting with R or L), not by zoning. QV.co.nz, homes.co.nz, and the Auckland Council website are reliable free sources.
Otherwise sensitive land is excluded. Waiheke Island, waterfront land over 0.2 hectares, rural land over 5 hectares, land including the seabed or foreshore (including Prince’s Wharf apartments), and most smaller islands are generally off limits under this pathway.
The $5 million threshold has specific rules. Either an existing dwelling at a purchase price over $5 million, or a property plus newly built dwelling that together exceed $5 million. Renovations don’t count. Chattels are excluded from the calculation.
Price manipulation triggers enforcement. Throwing in cars, art, or “cashback” arrangements to inflate purchase prices breaches the Act and exposes advisers, agents, and lawyers facilitating it to enforcement action alongside the investor.
Holiday home use is permitted. Properties can be rented or used as Airbnb (subject to local district plan rules). This is a deliberate departure from previous Overseas Investment Act policy.
Fees and timeframes are modest. $2,040 for an existing $5 million plus dwelling, $3,500 where a build is required. Most applications decided within 2 to 3 working days. A National Interest Assessment, if required, adds $83,700 and up to 55 working days.
Builds need to demonstrate genuine progress. Standard consent conditions give 3 years, with extensions available administratively where year-on-year progress is shown. Failure to reach the $5 million combined threshold can result in forced sale.
One beneficial interest per person. A family of four AIP visa holders cannot all share one property. Separate property arrangements (including contracting out agreements) are needed, and child purchases will be scrutinised closely.
The One Home to Live In pathway remains broader. For clients committed to living in New Zealand, that pathway opens up Waiheke, waterfront, and other otherwise sensitive land that the $5 million pathway excludes.
Adviser action point. Equip eligible clients with documentation (a letter or pointer to a key visa document) so they can readily establish their eligibility to real estate agents and conveyancing lawyers.

On 6 March, new rules under the Overseas Investment Act came into force allowing certain investor visa holders to purchase residential land in New Zealand for more than $5 million. The change ends a long-standing restriction that has kept most offshore investors out of the New Zealand housing market since the foreign buyers ban was introduced in 2018.

A lead advisor from the Overseas Investment Team at Land Information New Zealand (LINZ) presented a detailed walkthrough of the new pathway to NZAMI members. This article summarises the substantive content of that session for immigration advisers whose clients may be eligible.

1. Who can invest

The new pathway is open to people granted a residence class investor visa under one of three specific categories.

Investor 1 or Investor 2, the schemes in place from mid-2009 to mid-2022.
Active Investor Plus (AIP), including AIP visas granted under both the previous and current government.

Investor visa holders from before July 2009 are not eligible, even though their visas required investment in New Zealand.

The presenter flagged a practical point for advisers. Real estate agents and conveyancing lawyers will look to the migrant to establish their eligibility. Because the adviser is typically the person best placed to confirm visa status, equipping clients with a letter or a clearly identified key document they can present to third parties is a useful service to build into the engagement.

2. Companies and trusts, proceed with caution

Eligible visa holders don’t have to purchase in their own name. Companies and trusts can invest, subject to close-connection rules.

For companies, the visa holder or their spouse must own at least 25%, other overseas persons must own no more than 25%, and there is no limit on New Zealanders.
For trusts, only the visa holder and their immediate family (spouse and children) can generally have a beneficial interest, with controls on who can amend the trust deed or appoint trustees. This is narrower than a typical New Zealand family trust.

The presenter was direct about the risk profile here. The rules become complex very quickly, and the number of practitioners claiming Overseas Investment Act expertise is, in his view, considerably larger than the number who actually have it. Advisers without specific experience should refer clients to specialist legal advice rather than attempt corporate structuring themselves.

3. What they can buy, residential land only

The pathway only permits the purchase of residential land as defined under the Overseas Investment Act. Critically, this is determined by the property’s category on the District Valuation Roll, not by its zoning.

Look for category codes starting with R (residential) or L (lifestyle).
Zoning is irrelevant. Land zoned commercial can be categorised residential and vice versa.
Free sources include QV.co.nz, homes.co.nz, and the Auckland Council website. LINZ itself uses these tools.

Lifestyle land typically covers urban-fringe properties up to around 10 hectares with a house and modest land use such as keeping a couple of horses. Working farms (agriculture, horticulture, viticulture) are generally not residential land.

4. What they can’t buy, otherwise sensitive land

The new pathway only applies where land is residential and not sensitive for any other reason. As soon as land is also “otherwise sensitive” under the Act, this pathway is unavailable. Categories advisers should flag with clients include the following.

Non-urban land larger than 5 hectares. Many larger lifestyle properties fall here.
Land adjoining the seabed or foreshore larger than 0.2 hectares. Captures large parts of waterfront Auckland (e.g. Herne Bay, Takapuna), Nelson, Tasman, and the West Coast.
Land including the seabed or foreshore (no size threshold). Captures apartments on wharves such as Prince’s Wharf in Auckland and the Overseas Passenger Terminal in Wellington.
Land on listed inhabited islands over 0.4 hectares, including Waiheke, Great Barrier, Arapawa, and Stewart Island.
Land on any other (smaller) island, with no size threshold.

The presenter noted some recent media coverage suggesting offshore demand was concentrating on Auckland waterfront suburbs and Waiheke. Advisers should manage client expectations early. Waiheke and waterfront purchases are not absolutely off limits but are typically difficult under this pathway. LINZ’s first approved application under the new rules was, by way of a technicality, a waterfront property, so case-by-case property analysis is essential.

Identifying whether land is otherwise sensitive is the job of the real estate agent and the conveyancing lawyer, not the immigration adviser. The adviser’s role is expectation management.

5. The $5 million purchase threshold

The land must include a dwelling, either an existing one or one to be built. Bare land that stays bare is not permitted. A dwelling is, broadly, somewhere a person could reasonably live with little more than cleaning and minor repairs. Severely dilapidated buildings won’t qualify.

There are two ways to satisfy the $5 million threshold.

Existing dwelling. One property, existing dwelling, purchase price over $5 million (including GST if any).
New dwelling. Land plus newly built dwelling that together exceed $5 million. This applies even where there is already a dwelling on the land that will be replaced.

Important calculation rules.

Renovations don’t count. Spending on improvements to an existing dwelling cannot be used to reach $5 million. Genuine new builds do, even where one wall of the old structure is retained for heritage facade reasons.
Chattels are excluded. The $5 million is for land and improvements only. The sale and purchase agreement needs a proper purchase price allocation between land/buildings and chattels.

6. No games with the threshold

The presenter was unambiguous about price manipulation. Inflating a $3 million purchase to $5 million by throwing in a sports car, artwork, or a $2 million cashback arrangement breaches the Act. Where LINZ identifies that pattern, enforcement action will be taken against everyone facilitating it, including immigration advisers, real estate agents, and lawyers, alongside the investor themselves. There is genuine $5 million plus stock available in the market and the threshold exists specifically to ensure these purchases don’t influence pricing for ordinary New Zealand homes.

7. How the property can be used

Use is essentially unrestricted under the Overseas Investment Act. This is a deliberate change from prior policy, which discouraged holiday home purchases. Under the new rules the following are permitted.

Use as a holiday home, including by family.
Rental, including Airbnb or high-end short-stay arrangements.

Local district plan rules (Queenstown is a notable example) may still restrict short-stay rental use. Those rules sit outside the Overseas Investment Act and remain unaffected.

8. Fees and processing times

$2,040 where the agreed purchase price for the land alone exceeds $5 million.
$3,500 where a build is required, reflecting additional monitoring.
Statutory timeframe of 15 working days. Government target is 80% within 5 working days. Most applications are decided in 2 to 3 working days.
National Interest Assessment where required adds $83,700 and up to 55 working days. Investors may withdraw at that point if they choose.

National Interest Assessments are expected to be rare for this type of land. The presenter offered the example of a property adjoining the Devonport Naval Base or the Whenuapai Air Base, where the Defence Force might reasonably want visibility on a new offshore neighbour.

9. Sale and purchase agreements

All transactions must be entered into conditional on Overseas Investment Act consent. The standard ADLS REINZ agreement is adequate. A 20-working-day period to obtain consent is, in the presenter’s personal view, a reasonable condition period.

10. Build timeframes

Standard consent conditions allow 3 years to build a new dwelling. For substantial high-value builds, more time can be allowed administratively (without the usual fee and process) provided year-on-year progress is demonstrated.

A typical milestone progression that LINZ would accept across a 5-year build looks like the following.

Year 1, architect selected and concept designs underway.
Year 2, resource consent obtained.
Year 3, builder selected, building consent in hand, groundworks begun.
Year 4, build progressing.
Year 5, build complete.

If progress stalls or the combined cost fails to exceed $5 million, LINZ would bring the transaction to an end and require the property to be sold, typically within 12 months.

11. Why we would say no

LINZ identified four grounds for declining consent.

The transaction won’t exceed $5 million.
The applicant holds the wrong visa (temporary entry class or non-qualifying residence class).
The land is the wrong type, e.g. otherwise sensitive land such as waterfront, large rural, or restricted-island property.
The transaction is contrary to New Zealand’s national interest, following a National Interest Assessment. This is expected to be very rare for $5 million plus residential land.

12. Alternative pathways

Where the $5 million pathway doesn’t fit, other Overseas Investment Act consent pathways may.

One Home to Live In. For clients committed to actually living in New Zealand. Comparable fees and timeframes, and a broader land scope including Waiheke and waterfront. Cannot be used for holiday homes.
Residential development pathways. For new housing, rental development, or land supporting a business.
Benefit to New Zealand test. For non-residential sensitive land such as a farm.

None of these three alternatives permit holiday home use. The $5 million pathway is unique in that respect.

13. Ordinarily resident, why it matters

Obligations under the Overseas Investment Act apply only to “overseas persons”. Two groups are not overseas persons.

New Zealand citizens (whether or not they live in New Zealand, hold a passport, or are registered as citizens).
People ordinarily resident in New Zealand.

The definition of ordinarily resident is being slightly simplified, but the substance does not change. The new test has three requirements.

Holds a residence class visa.
Has been residing in New Zealand for at least the immediately preceding 12 months.
Has been physically present in New Zealand for at least 184 days in the immediately preceding 12 months.

The previous fourth requirement (183 days physical presence) added nothing meaningful over the 184-day tax residence test and has been removed. Nobody’s status changes as a result of the simplification.

The practical implication is significant. An investor visa holder who is ordinarily resident in New Zealand does not need to use this pathway at all. They can buy what they like, as any New Zealand citizen could. This pathway is squarely targeted at offshore investors.

14. Notable points from the Q&A

Citizens buying on behalf of overseas persons

A New Zealand citizen cannot lawfully purchase a property as a front for an overseas person. A “quiet $25 million arrangement” to buy a Queenstown holiday home on behalf of an offshore businessman would expose the citizen to enforcement action.

Whole families on AIP visas

Where all family members hold AIP residence class visas, each in theory qualifies. In practice, each person can only have a beneficial interest in one property. Spouses need clear separation of property (including a contracting out agreement) to each own a property under this pathway. Child purchases will be scrutinised carefully to confirm they are genuinely independent and not a vehicle for parents to acquire additional property.

Travel during the 12-month residency requirement

Short trips (a weekend in Sydney, a week in the Pacific, a month in Europe) do not break ordinarily resident status. What matters is whether the person is genuinely living in New Zealand. Splitting time 6 months in New Zealand and 6 months elsewhere, or returning home for 4 months after a brief furniture-installing visit, is much harder to characterise as residence.

Tax consequences

The tax implications of a purchase (including triggering tax residency and creating a permanent place of abode) are the investor’s problem, not LINZ’s. Advisers should ensure clients receive independent tax advice.

Holiday home rentals and Airbnb

Permitted under the Overseas Investment Act. Local district plan restrictions (e.g. Queenstown) still apply.

Practical action points for immigration advisers

Identify which of your existing clients hold qualifying Investor 1, Investor 2, or AIP visas and may benefit from understanding the new pathway.
Prepare a simple eligibility letter or document reference that clients can present to real estate agents and conveyancing lawyers.
Where clients ask about Waiheke or waterfront properties, manage expectations early. Refer them to a real estate agent and lawyer for property-specific analysis.
Do not attempt corporate or trust structuring under the Overseas Investment Act without specific experience. Refer to specialist counsel.
Flag the One Home to Live In pathway for clients who intend to actually relocate to New Zealand. It is broader and may better serve their purposes.
Caution clients (and decline to participate in) any arrangement that inflates purchase prices artificially. Enforcement risk attaches to advisers, agents, and lawyers, not just to investors.
Direct clients to obtain independent tax advice on the implications of buying and using New Zealand residential property.

Closing thought

The new $5 million plus pathway is narrower than the headlines suggest. Only specific investor visa holders qualify, only residential and non-otherwise-sensitive land is in scope, and the $5 million threshold has hard-edged rules around what counts. But for genuinely offshore-based AIP and earlier investor visa holders looking to acquire a high-end holiday home in New Zealand, the door is now open in a way it hasn’t been since 2018. The immigration adviser’s role sits at the front of that process, confirming eligibility, equipping the client with documentation, and managing expectations before the matter passes to real estate and property law specialists.