What is the process of buying a house in New Zealand? Are there any restrictions for overseas individuals/new residents purchasing property?

Hello! Congratulations on starting your journey toward buying a home in New Zealand! Having gone through this myself, I know it can feel overwhelming at first with all the jargon and steps. But don’t worry—I’ll walk you through the whole process and key points, keeping it simple and conversational so it’s easy to understand.

The Complete Process of Buying Property in New Zealand

Think of homebuying as "leveling up"—just take it one step at a time.

Level 1: Figure Out "Finance" – Get Pre-approval

This is the first and most crucial step. Before starting your house hunt, talk to a bank or mortgage broker.

• Why is it important? You need to know your budget first. Banks will review your income, expenses, savings, etc., and give you a pre-approval amount. This is like your "buying permit" that sets your price range.
• Who to contact? You can approach banks individually or use a mortgage broker. I personally recommend a broker—they’re free (paid by the bank) and can compare loans from multiple lenders to find you the best rates and terms. It saves time and hassle.
• What to prepare? ID (passport/driver’s license), visa status, proof of income (payslips/employment contract), bank statements, etc.

Level 2: Recruit Your "Strategist" – Hire a Lawyer

In New Zealand, a lawyer is mandatory. All legal documents, contract reviews, and settlements require one.

• When to hire? Find one before seriously viewing homes or making offers.
• What do they do?
  • Review the sale and purchase agreement, explain terms, and protect your interests.
  • Conduct a title search to check for any ownership issues.
  • Handle fund transfers and title transfer on settlement day.

Level 3: Find a Needle in a Haystack – House Hunting

The fun part! Look for properties via:

• Key websites:
  • realestate.co.nz
  • Trade Me Property
  • OneRoof
• Viewing options: Most homes offer Open Homes (public viewings on weekends). You can also book private viewings with the seller’s agent.

Level 4: "Health Check" the Property – Due Diligence

Don’t rush into an offer! Investigate thoroughly first.

• LIM Report: A council document listing official info like building consents, zoning, drainage plans, etc. Your lawyer will help analyze this.
• Building Inspection Report: Hire a professional inspector to assess the structure, roof, plumbing, insulation, leaks, etc. Spending a few hundred dollars could save you thousands in future repairs.
• Others: A valuation report if your bank requires it to confirm the property’s value.

Level 5: Go for It! – Making an Offer & Signing

There are three main ways to buy in NZ:

1. Negotiation/Asking Price: Most common. Submit a conditional offer via your agent/lawyer. Common conditions:

   • "Subject to finance": You can withdraw if your loan isn’t approved.
   • "Subject to builder’s report": Lets you exit or request repairs if issues are found.
   • "Subject to LIM report": Same principle.
     Once the seller accepts, you have a set period (e.g., 5-10 days) to fulfill conditions. After this, the contract goes unconditional and is binding.

2. Auction: Competitive live bidding.

   • Key: Complete all due diligence (LIM, inspection etc.) and have full finance pre-approval before auction. If you win, the contract becomes unconditional immediately—no backing out.

3. Tender: Sealed bids submitted by a deadline. The seller picks the best offer—you won’t know others’ bids.

Level 6: Final Sprint – Settlement

Once the contract is unconditional, wait for settlement day.

• What happens? Your lawyer and bank handle everything. The bank transfers the loan to your lawyer, who combines it with your deposit and pays the seller’s lawyer. Once confirmed, the agent releases keys.
• Congratulations! Collect your keys—the house is officially yours!

Restrictions for Overseas Buyers/New Residents

A key concern due to NZ’s 2018 Overseas Investment Act:

Category 1: Buy Freely (Same as NZ citizens)

No restrictions on buying any property (including existing homes) if you’re:

1. A New Zealand citizen.
2. An Australian or Singaporean citizen.
3. A Permanent Resident Visa holder
   • Critical condition: Must have lived in NZ for ≥183 days in the past year AFTER obtaining PR. You must be "ordinarily resident in New Zealand".

Category 2: Buy with Consent (Conditions Apply)

If you hold:

• A Resident Visa but do NOT meet the "≥183 days in the past year" requirement above.

You cannot buy existing homes directly. Must apply for pre-approval from the Overseas Investment Office (OIO). Key commitments:

1. You must live in the property.
2. You must spend most of your time in NZ while holding the visa.

Category 3: Generally Cannot Buy (Existing Homes)

If you hold a Temporary Visa such as:

• Work Visa
• Student Visa
• Visitor Visa

You cannot buy existing NZ residential properties.

Key Exception: New Builds

To encourage development, overseas buyers can purchase off-plan apartments or homes in new developments.

• How? Developers often have an OIO "Exemption Certificate" for the project. If you buy such a new home, you likely won’t need individual OIO approval.
• So, if you’re on a work visa and want to buy in NZ, new builds are your only option.

Hope this helps! While it involves many steps and rules, identifying your visa category and following the process makes it manageable. Good luck!